June 2002

Issuers face up to the debt market shoot-out

Euromoney June 2002

Borrowers have rarely been under such pressure. With credit markets volatile and investors jittery, issuing windows are short lived and the penalties for getting timing wrong can be severe. Entering the capital markets has become a lottery. One week they seem stable; the next they seem to be falling apart. And just when it seems that things can't get worse ... they get worse. So who have been the winners and the losers in this daunting new-issue environment?

Equity capital markets

Privates on parade fail to pass muster

Euromoney June 2002

This might be the year of the thwarted private-equity IPO. Since January, venture capitalists have been parading their most eligible assets before investors, who so far don't seem over-impressed by what they've seen.

Quality issuers

Agencies and supranationals

Euromoney June 2002

The World Bank, Freddie Mac and Fannie Mae were the saviours of capital markets in the wake of September 11. As the corporates hit trouble, supranationals and agencies remained much in demand.

The trouble with Fannie and Freddie

Euromoney June 2002

Fannie Mae and Freddie Mac spend millions a year promoting their goal of lubricating the mortgage market and widening home ownership. But critics and competitors still won't leave them alone.

Sovereign investors look more closely at quality

Euromoney June 2002

Sovereign issuers are back in fashion. But bond investors worry about deteriorating government finances and rising interest rates as well as corporate credit quality. So sovereigns must work harder than ever on new-issue and liability management programmes.

Securitization

Asset-backed comes into its own

Euromoney June 2002

Companies are finding it increasingly difficult to fund in orthodox markets. So despite essentially misguided comparisons with the sort of special purpose vehicles put together by Enron, securitization programmes are becoming increasingly popular with borrowers and investors.

Yen bonds

Football’s the only game in town

Euromoney June 2002

Football teams and their supporters can expect a warm welcome this month from their World Cup hosts in Japan. Most foreign borrowers will find it hard to milk this enthusiasm – the Japanese have been too badly burnt in recent months to want to invest in run-of-the-mill foreign companies seeking yen funding.

Japanese issuers

Learning to live without guarantees

Euromoney June 2002

As the ratings agencies threaten further sovereign downgrades, Japan’s government guaranteed issuers face new challenges. Their government funding is being cut and they must borrow more in their own right. That may bring surprising advantages.

Bank atlas

Bank atlas 2002: Banks focus on cost

Euromoney June 2002

Deutsche and HypoVereinsbank are the biggest risers in the latest bank rankings by shareholders' equity. Fewer mergers make the size rankings stable. Unfortunately banks' earnings have been anything but.

Indonesia

Number seven, lucky for some

Euromoney June 2002

Progress at the Indonesian Bank Restructuring Agency is crucial to dragging the country out of a mire of debt. Its new chairman, the seventh to hold the post, is well regarded. But he has suffered an early setback. Is this the toughest job in Asia?

IBRA’s role in jump-starting confidence

Euromoney June 2002

Portugal

Promises based on forecasts stretch credibility

Euromoney June 2002

Portugal’s new Social Democrat government is committed to reducing to zero the public deficit, now perilously close to the EU’s 3% ceiling, and increasing GDP growth by at least 50%. But do the figures add up, and can investors be persuaded to bankroll economic growth?

Business travel poll

Business travel poll 2002: A most challenging year

Euromoney June 2002

The after-effects of September 11 made for a tough time for airlines and hotels. Businesses banned non-essential air travel, leading to record losses among the biggest airlines which were in any case being squeezed by low-cost rivals.

Croatia

A fierce race for small-scale victories

Euromoney June 2002

The Croatian banking market is small and the experience of foreign investors in it has so far not been entirely happy. Nevertheless some foreign banks – notably from Austria, Germany and Italy – see it as crucial to their growth and a core part of their regional strategy.

Hopes are up but doubts persist

Euromoney June 2002

Spanish banking

Spanish banks: Twelve months of turbulence

Euromoney June 2002

Big mergers at the end of the 1990s, followed by banking scandals, have led to widespread changes at the top of Spanish banks. Exposure to Argentina has caused further headaches. The big two, SCH and BBVA, which are adjusting to their new identities, will be hoping that the worst is over.

US equities

ECNs and Nasdaq slug it out

Euromoney June 2002

The five-year battle between Nasdaq and ECNs is heating up. Nasdaq launches SuperMontage in July, a worthy rival to the ECNs’ trading systems that could win back dealflow. Meanwhile ECNs are depriving Nasdaq of crucial revenue. Is this the start of the trading endgame?

Editorial

Seeking the new model

Euromoney June 2002

It's been a long time since the chief executives of financial institutions faced anything like this degree of uncertainty - over the global economy, the direction of financial markets and the very future of the banking and investment banking business.