Nationwide 6.25% PIBS (POBA)

[DeBriele]

I believe the next call/reset date for these to be 22 Oct 2024 and that reset terms, if not called, are benchmark Gilt +2.58%

I'm wondering what views or comments there are on:

a) likelihood of call

b) where BM Gilt might be at in Oct24 (a good start might be, what is it now? - as admit I am not sure)

Thanks

DB

[yieldhog]

I think the 5-year benchmark gilt is currently around 4.53% . With a quick search, the first forecast I found was for the yield to rise to near 6% before peaking in a couple of years.
To buy these now I don't think you could expect to get much volume below 100. Latest LSE trades are all around 99.60.
They are a pretty safe bet if you just want a reasonable yield spread over gilts ( maybe 1.5 - 2 %).
On rhe other hand the bid-offer spread is much larger than gilts and liquidity a lot less.
Also, if you are prepared for a bit more risk, you can get much better yields elsewhere in the long dated/Undated market. For example GACA (General Accident) 8.875% prefs are currently yieding more than 7.5%. I'm sure you can pick up similar risk bonds for nearer 8% (PIBS,sub bank debt etc.).
Y

[notyep]

I hold these and fully expect they will be called. I also held the 7.25 which were called awhile ago so I doubt if Nationwide will do anything different this time.

[shaunm]

I hold these and fully expect they will be called. I also held the 7.25 which were called awhile ago so I doubt if Nationwide will do anything different this time.

I also hold these, and also expect them to be called on 22 Oct 2024
I will hold until the call