Tag: credit risk

Banks Snub Chicago Aldermen On Equitable Mortgage Lending

Mary Pat Campbell

Link: https://www.wbez.org/stories/banks-snub-chicago-aldermen-on-equitable-mortgage-lending/f470444a-42e1-478c-997e-db8dfe52229f

Excerpt:

Home ownership rates in Chicago’s Black and Latino communities have been falling, according to information presented by Anthony Simpkins, president and CEO of Neighborhood Housing Services of Chicago.

Citing research by the DePaul Institute for Housing, Simpkins said not only are banks lending less in Black and Latino neighborhoods, they are also filing more foreclosures.

And he said borrowers of color who are able to get a loan are often charged a higher interest rate; in 2019 he said Woodstock Institute found nearly 35% of African American mortgage borrowers in Chicago paid higher rates, 17% of Latino borrowers.

Author(s): Linda Lutton

Publication Date: 27 February 2021

Publication Site: WBEZ

Junk Has Never Been So Valued

Mary Pat Campbell

Link: https://www.wsj.com/articles/junk-has-never-been-so-valued-11612915150

Excerpt:

If you’re an over-leveraged company at risk of default, now’s your moment to load up on more debt. The average yield on U.S. junk bonds dropped below 4% for the first time on Monday amid a market scavenger hunt for higher returns.

The Federal Reserve has pushed down long-term interest rates by buying bonds and committed to keep short-term interest rates at near zero through 2023. While the central bank’s interventions were needed in March, it continued to buy corporate bonds well into the summer when markets didn’t need the support.

Author(s): WSJ Editorial Board

Publication Date: 9 February 2021

Publication Site: Wall Street Journal

Chicago Public Schools’ yield penalties hit fresh low

Mary Pat Campbell

Link: https://fixedincome.fidelity.com/ftgw/fi/FINewsArticle?id=202101291341SM______BNDBUYER_00000177-4f21-d760-a9ff-4ffdc0490002_110.1#new_tab

Excerpt:

Investors on the hunt for yield with few pickings scooped up Chicago Public Schools? junk paper Wednesday driving down the district?s yield penalties paid in the primary market to their lowest in years.

The 10-year in the $560 million sale that marked the Chicago Board of Education?s first COVID-19 era sale settled at a yield of 1.94%, a 117 basis point spread to the Municipal Market Data?s AAA benchmark.

The BBB benchmark was at an 89 basis point spread Thursday. The new-money and refunding bonds carried one investment grade rating and two speculative grade ones and while high yield investors snapped up the paper, Alliance Bernstein?s high impact social fund shunned the transaction. The fund said the district has failed to provide sufficient evidence it?s protecting students from in-school sexual misconduct in the aftermath of a scandal that drew a rebuke from the U.S. Department of Education.

Author: Yvette Shields

Publication Date: 29 January 2021

Publication Site: Fidelity Fixed Income