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Rich Herman
Rich Herman, Deutsche Bank
As the credit crunch continues to bite, Rich Herman, global head of institutional clients at Deutsche Bank, tells Geraldine Lambe that banks and clients alike have to morph to fit the new landscape. But the crisis brings with it opportunities as well as challenges.
The world paper chase
Samantha Pitt, Network Rail
Market unrest has helped Asian investors to buy AAA rated paper from Europe at best-ever prices, yet there is growing competition from around the world, reports Michael Marray.
HSBC pulls off €1bn ING debut against unpromising backdrop
HSBC’s covered bond team planned its winning strategy for ING’s covered bond issue around confidence building, and gathered interest in a cautious market through shadow bookbuilding. Edward Russell-Walling reports.
Rush of orders in a tricky market
George Dessing, Wolters Kluwer
A desire for liquidity drove Wolters Kluwer to issue a 10-year bond last month in an otherwise barren market. It was lapped up by investors, Edward Russell-Walling reports.
Roberto Vila
Roberto Vila, Commerzbank
Commerzbank’s global head of equity derivatives talks to Natasha de Terán about the bank’s expansion plans away from its European strongholds and the secret behind the company’s low staff turnover.
Whatever happened to ‘negative flex’?
David Bassett, Royal Bank of Scotland
In the wake of the market crisis, fewer syndicated loans are being issued, terms are tighter, prices are up and non-bank investors have virtually left the market, reports Joanne Hart.
Driver UK deal helps RBS swerve slowdown
The credit crisis has brought the ABS market to near standstill. However, RBS has remained active in the field and used its healthy relationship with VW to good effect, reports Edward Russell-Walling.
National Grid bites the bullet
Malcolm Cooper, National Grid
The UK’s largest energy utility, National Grid Gas, tentatively reopened the sterling corporate bond market earlier this year, in the face of unfavourable conditions. Edward Russell-Walling reports.
Jacques Brand & Jim DeNaut
In some cases two heads are better than one, and the managing directors and co-heads of global corporate finance at Deutsche Bank have got global client management down to a fine art using the partnership approach, as Kathryn Tully discovers.
Prescriptions for a capital raising headache
Tiina Lee, Deutsche Bank
As write-downs hit, many banks are being left with no alternative but to raise more capital this year. Some believe that hybrid securities will be the favoured approach, others believe that market conditions will make the equity and equity-linked markets the easier route. Neil Sen reports.
Exotix boldly tackles the Yemeni frontiers
So-called ‘frontier markets’ hold no fears for some investors. Edward Russell-Walling reports on how broker-cum-investment bank Exotix went digging for profits in the zinc mines of Yemen.
Adam Knight
The co-head of global commodities at Credit Suisse talks to Geraldine Lambe about building the bank’s commodities platform in a market that is booming and showing evidence of increasing maturity.
Emerging markets remain on track
While the European and US markets are suffering, emerging markets continue on their upward trajectories, indicating that the drivers of world growth have changed. Edward Russell-Walling reports.
Rising to the pensions challenge
Guy Coughlan, JPMorgan
Investment banks have been sitting up and taking notice of the pensions industry in recent years – an industry with global benefit liabilities of nearly $20,000bn. Edward Russell-Walling reports on how the banking industry’s big hitters are managing longevity risk.
Unlikely timing pays off for SEB
Anders Kvist, Skandinaviska Enskilda Banken (SEB)
Edward Russell-Walling reports on how SEB managed to sell €500m of hybrid capital securities in the midst of a market low-point.
Deutsche deal on the brink of history
The flotation of DP World last year may prove to be a landmark deal for the emerging markets. Edward Russell-Walling reports on how Deutsche Bank handled the largest ever Middle Eastern IPO.
RBC Capital Markets
Chuck Winograd, RBC Capital Markets CEO
Chuck Winograd, chief executive of RBC Capital Markets; Doug McGregor, RBC’s co-president and head of global investment banking; and Mark Standish, RBC’s co-president and head of global markets, talk to Geraldine Lambe about the company’s need to grow outside of Canada.
A healthy appetite in Canada
Stability and access to a wealth of natural resources makes Canada attractive for investors. Geraldine Lambe reports on the resulting buoyant activity in the country’s capital markets.
Legislative change drives markets
Sarah Kavanagh, Scotia Capital
New pieces of legislation affecting tax and ownership are having a dramatic knock-on effect on Canada’s capital markets. Geraldine Lambe reports.
Unflinching Merrill propels Fortis into the big league
Merrill Lynch’s singleness of purpose played a vital part in the Royal Bank of Scotland-led consortium’s takeover of ABN AMRO. And nowhere more so than in the Fortis rights issue, the biggest ever in dollar terms, which tipped the scales against all predictions. Edward Russell-Walling reports.
Ghana shows pioneering spirit
Paul Acquah, Central Bank of Ghana
Ghana’s $750m 10-year Eurobond issue is another in a series of firsts from the republic and observers are hoping it heralds the blooming of Africa’s capital markets. Edward Russell-Walling reports.
Post-crisis focus on emerging markets
It is time to start thinking about the next upturn. The credit crisis still has some while to run depending on how it seeps through the system and it seems likely that most parts of the world will be affected in some way or other.
New trends among sovereign funds
Politicians in the West who object to sovereign wealth funds from the developing countries making overseas acquisitions should ask themselves one question and one question only.
Viswas Raghavan
JPMorgan’s head of equity international capital markets tells Geraldine Lambe about how the firm’s European division has transformed its equity-linked prowess into a broader platform.
Off the critical list, but still limping
Michael Ridley, JPMorgan
Europe’s corporate bond market has regained consciousness after a six-week shutdown, though it is not the same animal it was back in June. Edward Russell-Walling explains.
ABN AMRO unlocks the door to liquidity
For ABN AMRO’s pioneering property derivatives team the value of deals is mushrooming, but it is keen that other players enter the market and create greater liquidity. Joanne Hart reports.
RBS makes history
Ron Huggett, RBS
Funding for RBS’ share of the ABN AMRO takeover has been secured with the largest ever Tier 1 capital securities issue. RBS director of capital management Ron Huggett talks to Edward Russell Walling.
CEOs must take a longer term view
Chuck Prince has been horribly pilloried for his now infamous “we’re still dancing” comments that came in July, just before the blow up in August. But the fact is that any bank that quit a market ahead of the peak, and any major investment bank that was absent from a key sector at a time of huge build up, would be punished by shareholders for giving up profits.
Can rescue package make things better?
Will the rescue fund for American mortgage lenders being put together by Citigroup, Bank of America and JPMorgan make things better or worse?
Philippe El-Asmar
Barclays Capital’s head of investor solutions, Americas, tells Kathryn Tully how he successfully built a team from scratch to develop tailored structured products across all asset classes as well as equity and fund derivatives solutions.
Arrangers of a complex marriage
Dresdner Kleinwort is ahead of the advisory pack in terms of deal value in European electricity mergers and acquisitions this year. The bank’s utilities and natural resources team talk to Edward Russell-Walling about their recent success in one of the most difficult deals in cross-border history, Enel’s takeover of Endesa.
NIB excites feeding frenzy
Kari Kukka, Nordic Investment Bank (NIB)
Nordic Investment Bank is demonstrating that it is a quality AAA name with its search for funding diversity leading it to success in international pastures, and hungry bankers knocking on its door begging for short-term paper. Edward Russell-Walling reports.
Rationale rests with subprime borrowers
It is easy to be wise with hindsight, but it is all rather obvious now that off-balance sheet vehicles work fine when they are being used for authentic assets that banks really wanted to generate but have decided, for balance sheet management reasons, would be better securitised.
Half a venture is better than none
The noughties are definitely becoming the age of the joint venture. At one time, banks only took a percentage stake if legislation prevented them from taking more, and large banks definitely did not do joint ventures because they had the clout to own 100%. But now, CEOs who 10 years ago would have been strict control freaks are entertaining the idea of having half of something if it is the only sensible way to get it.
Daiwa heads for Japanese diaspora
Between 40 and 50 Daiwa executives in Tokyo are going to discover this month that they are bound for pastures new, maybe other parts of Asia or maybe London.
Central banks are ‘suckers’
The markets are in uproar and central banks are stepping in to try to bring about calm. But should they? Or should banks get their just punishment for wreckless lending? Dick Bove, an analyst with investment bank Punk Ziegel, thinks the market should be left to seek its own solution.
Public versus private equity markets
Roger Ehrenberg, president and COO of Monitor 110
Is the growth of private placements at the expense of public equity offerings in the US a temporary phenomenon or does it signal a more significant shift away from public scrutiny? And, asks Geraldine Lambe, will it undermine the listed market?
BNP Paribas makes structured products more flexible
BNP Paribas’ structuring team is meeting growing demand with some innovative approaches. Edward Russell-Walling explains.
Enel goes to bond market
Claudio Machetti,Enel
Italy’s Enel is set to become a bond market regular, following its successful bid for Spain’s Endesa. Finance chief Claudio Machetti talks to Edward Russell-Walling about its latest corporate issue.
Too-big-to-ignore list is growing
Not every bank desires to be a global powerhouse but there are some markets that are TBTI (too big to ignore). Chief executives need to have a China strategy and an India strategy for sure but the TBTI list is growing faster than CEOs can keep up with.
Kazakh bank makes inroads into China
One emerging market bank on the move is Bank TuranAlem, which, as one of the largest private banks in the Commonwealth of Independent States (CIS), is expanding overseas.
Diligence from a different source
For all banks investing overseas, good due diligence is essential. No wonder companies with names such as Diligence are appearing alongside the more familiar Krolls and Control Risks.
Dan Cozine
The managing director and co-head of the Americas energy and commodities structured debt team at BNP Paribas tells Kathryn Tully what lies behind the bank’s restructuring to form a new global energy and commodities structured debt team.
The next stop for investment in public private partnerships
Bankers are looking at the BRIC countries to expand their business and to boost public private partnership portfolios. Which are the most appealing locations? Silvia Pavoni, John Rumsey, Ben Aris and Kala Rao report on the state of PPP development in Brazil, Russia, China and India .
China: words not deeds
Wolfgang Bischoff, Siemens Project Ventures
China, the fastest developing country in the world, with a 10.7% gross domestic product (GDP) growth in 2006, is a very indicative example.
Russia: slow progress
When it comes to big statements and declarations of intention, Russia might come across as more vocal in inviting the private sector into its infrastructure and strategic sectors, while still maintaining control of the most important assets.
India: committed approach
India presents similar political fragmentation. Local authorities are in charge of developing much of the local infrastructure and need external funds; and the central government has the buying power but not the implementation capability.
Infrastructure projects pull in new investors
Once regarded as dull and unfashionable, infrastructure projects are now the hot new alternative asset class. Edward Russell-Walling reports on why they are attracting new investors.
Jim Amine
The co-head of global leveraged finance at Credit Suisse tells Geraldine Lambe that the leveraged party isn’t over yet and that targeted investors should cushion a downturn.
Appetite for lending
Steven Victorin: ‘market is characterised by exceptionally strong liquidity’
The syndicated loans market has grown rapidly in recent years, driven primarily by an increase in corporate takeovers, private equity transactions and infrastructure deals. Strong liquidity means there is plenty of cash to invest, and banks are willing lenders. Joanne Hart reports.
Tight window of opportunity
A consortium including Goldman Sachs won the mandate for a strategic review and IPO execution for Turkey’s state-owned Halkbank. A tight schedule for US distribution and a political/religious row that spilled volatility into the Istanbul stock market failed to derail the sale. Edward Russell-Walling reports.
Tight funding levels, higher volumes
A $3bn global bond, a €5bn benchmark deal – and the year is barely half started. Edward Russell-Walling reports on KfW’s labours.
China’s malaise is private equity’s gain
Is the private equity boom a result of the Asian savings glut? The Chinese current account surplus was $250bn in 2006 and is heading for $375bn this year. Foreign reserves hit $1200bn in the first three months of this year. This provides “a base level of liquidity being pumped out into the world”, says Charles Dumas, director of UK-based Lombard Street Research.
PIK notes dance to the equities tune
There has been a lot of talk about hybrid capital for corporates but very few products. One exception, however, is the PIK (payment in kind) note that sits rights next to equity in leveraged deals.
Rabo profits from radical issues
Something odd happened to AAA rated Dutch co-operative Rabobank last year: its profits grew by 13% rather than 12%. To those of us accustomed to volatile earnings, this seems like a variance hardly worth mentioning. But Rabo’s earnings growth has stood at 12% minus or plus a basis point or two for a century, so 13% is out of the ordinary.
Lachlan Edwards
Goldman Sachs’ co-head of restructuring in Europe talks to Geraldine Lambe about the effect an increasingly complex financial structure will have on companies’ survival in the future.
Post-election France has everything to play for
Jean-François Mazeaud, SG CIB
Following the French elections, the markets are returning to normal, with plenty of activity predicted, especially in state-involved sectors. Geraldine Lambe reports on how the pace is picking up.
Open to foreign business
François Kayat,Calyon
With or without a radical change of approach by the new president, France’s markets are surprisingly open to overseas companies.Geraldine Lambe reports.
Eastern philosophy takes Nomura to a higher level
Through the successful Asian marketing of IPOs for Russian property developers Sistema-Hals and PIK, Nomura’s Moscow operation has managed to position itself as a gateway to ‘eastern’ investors.Edward Russell-Walling explains.
Hive of microfinance activity attracts serious attention
Investment banks and institutional fund managers are being persuaded to take microfinance institutions seriously as they show better returns than some other emerging market investment vehicles and prove their stability in the face of external shocks. Kathryn Tully reports.
EIB grasps the green nettle
Bertrand de Mazières, EIB
The European Investment Bank aims to aid integration and development of EU member states, and has launched ‘climate awareness’ bonds as part of its strategy. Edward Russell-Walling talks to director-general Bertrand de Mazières.
Investors hop on the Africa conveyor belt
The great Africa opportunity awaits and it could involve higher growth in output and profits than the world has ever seen before.
Regulators deplore loan settlement gap
Africa does not have a monopoly on transaction snarl-ups, as those engaged in the credit derivatives markets in recent years are fully aware.
Banks prepare for market convergence
The processing situation needs to be resolved before millions more investors pile in. These are the private investors who will soon get full access to institutional products and markets, dubbed “the instividuals”.
Will private equity get you?
A trickle of private equity activity in the financial institutions space is threatening to become a flood, with prime assets becoming targets. Geraldine Lambe reports.
Neal Shear
Morgan Stanley’s co-head of securities sales and trading, Neal Shear, explains why the firm reorganised the structure of its institutional securities, and the effect his role heading the trading division will have on risk taking. Kathryn Tully reports.
CEE surfs a new wave of structured finance products
A surge of new offerings are coming out of central and eastern Europe, with Russia and Kazakhstan showing the new EU countries how it should be done. Michael Marray reports.
West continues to woo Asian investors
Observers see the lack of Asian participation in dollar deals as a temporary blip, due largely to current conditions. However, European bankers are still keen to cultivate investment from Asia. Michael Marray reports.
Merrill emerges triumphant
The debt specialists at Merrill Lynch have been busy blazing new trails in the emerging markets. Edward Russell-Walling reports.
Selling junk to hit gold
Kathleen Quirk, Freeport’s CFO
When a merger fell through last autumn, mining company Freeport-McMoRan was undeterred. It has just bought a rival and issued the world’s biggest junk bond to pay for it. Edward Russell-Walling explains.
Europe makes waves in capital markets…
Expect Europe to be the major arena of interest in the capital markets over the next five to 10 years. Underwriting fees are two to three times higher in the US but growth prospects are far better in Europe.
…as Asia struggles to bounce back
Capital markets to reach European levels if current low investment rates continue. Asian Development Bank’s Outlook 2007 notes that 10 years after the region’s crisis, growth rates are still not back to pre-crisis levels in the countries worst affected: Indonesia, Korea, Malaysia, Philippines and Thailand.
Posties buckle under weighty HSBC tome
Information is essential to the finance business – but sometimes it can weigh heavy. The UK’s Post Office was so worried about the weight of HSBC’s annual report that it limited the number that an individual postman could carry, to avoid back injuries.
Credit (checking) where it’s due
Helping to ease the information flow for banks are companies such as Experian, which share credit data between them – a service that used to be held in rather low esteem by consumer groups and politicians but is increasingly recognised as a respectable activity.
Globalisation poses new challenges
National monetary policy must not only be determined within a domestic framework but is also influenced by global economic indicators. In the new era, central banks face serious challenges, says Jacques de Larosiére.
Nick Teller
The CEO of Commerzbank’s corporates and markets division is meeting his brief to cut costs and risk but, he tells Geraldine Lambe, under his aegis there will also be selective growth.
Turbo-charged UBS
In an extraordinarily short time frame, while much of the market was on holiday, UBS’s hybrid team managed to administer issues from Nationwide, DnB NOR, Generali and HSH Nordbank. Edward Russell-Walling reports.
Nowhere to run if the hammer falls
The great crash of 2007 may not materialise but already it is clear that, if it does, there are few places to hide. Asset classes are linked together in a way unseen previously and a problem in one class will likely impact on another one.
International status for emerging money
Emerging markets such as Mexico and Brazil may be issuing in their own currencies internationally but the big shift to the euro-peso and the euro-real is still to come.
Short on cash? Next month will be fine
Where can you offload a bad loan that is causing you headaches? Try transferring it to Credit & Mercantile, the UK finance house that allows its clients to miss interest payments without automatically putting them into default.
Turkey’s Calik full of energy
Turkey-based Calik Holding, keen to finance its overseas purchases in areas ranging from construction and telecoms to banking and energy, has burst on to the international stage with a $200m debt issue. Edward Russell-Walling reports.
David Fass
Deutsche Bank’s head of global banking, EMEA, fills Geraldine Lambe in on the company’s numerous unsung successes: M&A, emerging markets and – surprisingly coming from an investment banker – cash management services during the execution of transactions.
Good principles are hard to live up to
Dan Siddy: EP is ‘not a panacea’
Cracks are starting to appear in the Equator Principles. While banks may not lend money for non-compliant projects, they are still free to invest or to lend to export credit agencies that do the financing. Geraldine Lambe explores the new reputational risks this throws up.
JPMorgan gets the casino ball rolling
JPMorgan’s CMBS business is booming, helped by a $960m property loan for Colony Capital’s casino assets. The team tell Kathryn Tully how they pulled off the biggest CMBS deal in the gaming industry.
Exposed LSE playing too hard to get
Shareholders in the London Stock Exchange (LSE) may come to regret the day the exchange’s board turned down Nasdaq’s £12.43 (€18.64) offer for its shares. The LSE is running out of suitors and the emergence of new trading platforms, such as Project Turquoise, are challenging its position.
Size of private equity deals getting unruly
Between 2001 and 2004 there were no private equity deals greater than $10bn. Over the past two years there have been 15, including Blackstone’s $38.9bn buy-out of Equity Office Properties last month, the largest leveraged buy-out on record.
IMF remit should be warding off trouble
Predicting the trigger for the next big crisis is a favourite topic of analysts and off-duty bankers and, of course, they are almost certain to be wrong. By definition, crisis is provoked by an unforeseen series of events.
African attractions grow
Stefan Nalletamby: AfDB is bringing much-needed visibility to African markets
The viability of capital markets in African countries is looking more promising, underlined by a successful bond issue denominated in naira by the African Development Bank. Edward Russell-Walling reports.
Gearing up for fresh snow
With company default rates at historical lows, pickings have been thin on the ground for the much-maligned distressed debt banker. But lenient lending policies to troubled firms in recent years may mean a bonanza is on its way, says Karina Robinson.
The true story of numbers at HSBC
On the back of a series of negative press and analyst comments, The Banker catches up with Douglas Flint, group finance director of HSBC, to hear the bank’s explanation.
Dow Kim
The co-president of global markets and investment banking at Merrill Lynch assures Geraldine Lambe that a spate of diversified acquisitions is all part of a disciplined strategy to reshape the company.
Hot products 2007
Lisa Watkinson: synthetic CDOs will be popular
How can investment banks hope to match last year’s stellar performance? Some say that is impossible, but Geraldine Lambe picks out the products that others believe will bring them riches.
Capital injection aids development
For the first International Finance Facility for Immunisation debt issue to succeed, lead managers Goldman Sachs and Deutsche Bank had to devise a way of frontloading development finance at an affordable cost. Edward Russell-Walling reports on a scheme designed to ensure reliable funding for vaccine projects.
Bleakness in the crystal ball
Dealmakers are natural optimists, whereas analysts are usually pessimists. Dealmakers enjoy taking risks and believe they will make money against the odds; analysts spend so much time crunching numbers and looking at 100 different scenarios that by the time they have finished the entire outlook seems bleak. Even so, it is hard to see how all the analysts’ dire predictions for 2007 can be avoided.
Rough forecast for acquisitions
CreditSights does not have a monopoly on 2007 doubts and the analysts have more than just the pure investment banks in their sights. ‘Cracks beneath the surface’ and ‘Turning cautious on the European bank sector’ are titles in two recent Citigroup reports.
Top of the political pessimism league
When it comes to pessimistic forecasts, Exclusive Analysis is in a league of its own, expecting increasing expropriation risks to foreign investors in Russia, more attempted attacks by terrorists in the UK and an increased risk to energy infrastructure in the Gulf from Sunni extremists.
