Insight & press commentary

Latest Press

Risk.net – Insurance Risk – UK life firms rethink forex hedging after PRA note


By Rob Mannix

Investec is also pitching a solution, offering to issue senior secured banknotes with security to insurers over the assets they no longer want to hold. [..] Other banks are understood to be touting similar but more structured ideas to clients, but Investec is alone in proposing to issue its own notes with security over the problem assets. The bank is also proposing the idea as a way to deal with callable bonds and possibly inflation-linked assets.

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FixedIncomeInvestor.co.uk – Impala Bond of the Week


By Oliver Butt

To date the Impala programme has taken fixed rate bonds and swapped them into a) floating rate notes (paying spreads over Libor), b) floating rate notes with an initial fixed rate period and c) inflation linked bonds. You can of course buy bonds that have been issued as floating rate notes (FRNS) or inflation linked bonds. However, with very few exceptions these tend to have lower credit spreads than are available in the fixed rate market...

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ipe.com - Liability-Driven Investment: Banks and the linkers market


By Harris Gorre

Inflation-linked bonds are one of the most sought-after securities among UK’s defined benefit pension schemes... As government linker issuance shrinks, Harris Gorre argues that banks are in a much better position to issue secured, structured bonds with index-linked yields than corporates...

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The Times - Get the right banking partner


By Raconteur.net

Working with a proactive banking partner, who understands business needs and knows the right time to act, is key to success, says Investec

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Investorschronicle.co.uk - Protect your bond portfolio


By Julian Hofmann

There have been at least two by-products from the financial crash that will determine how bond investors review their portfolios over the next few years...

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FT.com - Rate rise fears stoke EU floating rate bond revival


By Andrew Bolger

“But while there has been a big increase in European floating rate note issuance the fundamental challenge remains that supply does not even come close to meeting demand.” Harris Gorre

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ProfessionalPensions.com - Schemes ‘under-hedging interest rate risk’


By Natasha Browne

“Our driving engagement with pension funds is more addressing, if you hedge all of your interest rate risk, what happens to your inflation-linked liabilities?”

“The more assets schemes had a direct inflation linkage that matched their liabilities; the less requirement there was to hedge their interest rates”. Harris Gorre

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Pensions-Insight.co.uk – Who needs banks anyway?


By Sam Brodbeck

For schemes that are not comfortable with private equity, loans can represent a half-way house. They are illiquid but have a definite end date and a regular income stream. Harris Gorre, head of financial products at Investec, said schemes “have to make the statement they are comfortable with the unknown” and warns that institutional investors have underestimated the complexity of the asset class.

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IntelligentInsurer.com - Solvency II will force insurers to dump corporate bonds


By IntelligentInsurer.com

“Solvency II looks to provide a challenging new landscape for insurers who hold long dated corporate debt, even as many fixed income investors and commentators still find the credit term premium attractive ... We’ve developed a unique solution that ensures they can hold long dated corporate bonds whilst removing their interest rate risk” Harris Gorre

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GlobalInvestorMagazine.com - Hedging interest rates and inflation


By GlobalInvestorMagazine.com

“We are addressing a need in the market that is not there,” he says. “Being entirely bespoke means that investors are buying a bond that matches their exact return requirements.” Harris Gorre

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ReactionsNet.com - Investec launches bond swap for duration risk


By ReactionsNet.com

Aimed at general insurers and reinsurers, investment firm Investec's Impala bond programme looks to hedge duration risk in fixed income bond portfolios.

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ai-CIO.com - How to Deal with Interest Rate Rises (Without Using Derivatives)


By Charlie Thomas

“A problem for many investors is what happens to their fixed-rate paper when interest rates begin to rise...
... Mid-sized pension funds are also looking at the Impala bond as a way to remain liquidly invested in the run up to a pension risk transfer” Harris Gorre

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Pensions-Expert.com - BT ups inflation-linked assets in continuing shift


By Lisa Botter

“The popularity of inflation-linked assets is at its peak as DB schemes look to match their liabilities.” Harris Gorre

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Travelbulletin.co.uk - ‘Why currency trading could hold the key to boosting travel firms’ profits’


By Jonathan Pryor

Squeezed incomes, cuts in corporate travel budgets and flat economic growth have all created a perfect storm for the travel industry since 2008. However, the industry has worked hard to adapt, cut costs, re-shape services and build online offerings. Positive results from industry leaders such as TUI and Thomas Cook point to a resurgent industry and one that is leaner and better able to profit from the improved economic headwinds...

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ProfessionalPensions.com - Gilt yields stagnant as Fed announces tapering


By Natasha Browne

“It would take a brave man or woman to head into 2014 as an interest rate contrarian.” Harris Gorre

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FundWeb.co.uk - 'About as dovish a taper as could be imagined': Reactions to Fed shift


By Gary Jackson

“At the beginning of 2013 we saw a number of investors ambivalent about duration risk, predicting another 10 years of interest rates significantly below the long term average. As the year draws to a close however we see far fewer investors prepared to take on this risk,” Harris Gorre

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International Finance magazine - ‘Maximising the returns from international market opportunities’


By Jonathan Pryor

With the right currency management solutions companies should be able to maximise the returns from international market opportunities...

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Dofonline.co.uk - Maximising the returns from international market opportunities


By Jonathan Pryor

With the right currency management solutions companies should be able to maximise the returns from international market opportunities.

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Efinancialnews.com - Meet the 2013 Rising Stars of Investment Banking


By Darren Lazarus and Matt Turner

“This is the third annual FN 40 Under 40 Rising Stars in Investment Banking, Financial News’ pick of the bright young things in the industry.” Harris Gorre selected as one of the rising stars

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EMIR’s strategic implications for European boutiques, asset managers


By Price Waterhouse Coopers

"An apparently technical regulatory directive could trigger a move into completely different investment strategies." In this environment we would expect listed, non-recourse investments to provide for attractive alternatives.

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Efinancialnews.com – Castor bond ignites investor interest


By Matthew Attwood

“Investec’s Impala programme gives investors inflation and interest-rate protection by turning fixed-income bond payments into either floating-rate or inflation-linked cashflows.”

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FixedIncomeInvestor.co.uk – Bond of the Week

Investec, a base rate linked preference share...


By Oliver Butt
In the prolonged absence of a new issue for the ORB market I present something completely different. I normally leave others to write Bond of the Week on non-new-issue weeks but I thought I would present the below just because it is very different. It is an issue that might not suit everyone’s portfolio but I think it at least raises interesting ideas. In truth it is not even a bond but a preference share.

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Real Business – biggest FX problems for SMEs


By Jonathan Pryor

As Western economies struggle with sluggish growth and high levels of government debt, many businesses turn to the rapidly expanding emerging markets in Asia and South America for growth opportunities. However, venturing into the unknown comes with risk, and the typical SME will often face daunting logistical challenges in reaching such far-flung markets.

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Investmentweek.co.uk - Where are you still finding value in bonds?


We see value in subordinated financial credit spreads, and saw strong demand for floating rate paper in the insurance sector over the summer - Harris Gorre

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FT.com - Five tips for bond investors


By Lucy Warwick-Ching

Bond investors have been hit by increased volatility in the sector since May when the US Federal Reserve announced plans to reduce its bond purchases.

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FT Adviser - Investec: Shop around for bond alternatives


By Harris Gorre

Investec Bank’s Harris Gorre says bond investors should shop around like mortgage buyers as the end of QE looms.

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Market Insight

  1. 06 Jan, 2014

    Challenges as the fixed income ride comes to an end

    Fixed income investors have benefitted from increased returns as a result of falling interest rates over the past 30 years. This has meant that most bond investors have had their income...

  2. 07 Nov, 2013

    Impala Frequently-Asked Question: Why Not Use Bond Futures Instead of Swaps?

    A question that frequently gets asked is ‘why not just use Gilt futures to hedge?’ Investec’s Magnus Burbanks addresses this by outlining some problems that arise using futures (particularly 10yr Gilt futures) to hedge interest rate risk in the context of Impala. Magnus is responsible for the Interest Rates desk at Investec and works in collaboration with the bank’s client-facing operations when executing hedges in the interbank markets.

  3. 28 Aug, 2013

    Why issuers don’t want to issue inflation-linked bonds

    The goal of inflation-linked bonds is to ensure that purchasing power is maintained and that a real return, fixed at the beginning of the term, is paid (typically on an annual basis) to the holder of the bonds.

  4. 09 Aug, 2013

    A Man of Inflated Expectations: all eyes on tomorrow's BoE Inflation Report

    It’s a tricky one to play for Carney as the recent UK data has been stronger, indicating that the economy is recovering...

  5. 02 Aug, 2013

    Are Bonds still relevant in a balanced portfolio?

    Simple investment rules sometimes provide for the best lessons. Harris Gorre reflects on the past five years and the merits of holding appropriate Bonds in balanced portfolios.