December 2006
| Euromoney December 2006 Large numbers of new institutional credit investors – mezzanine funds, hedge funds, CLOs, CDOs and distressed debt funds, are disguising the true level of stress and distress among borrowers at the riskier end of the credit spectrum. In some cases, they might even be exacerbating it. |
Euromoney December 2006
Rarely has a country’s banking system experienced such an overhaul in such a short space of time as Italy’s has over the past 12 months. The urge to merge has made banks team up with local rivals to avoid being gobbled up by a foreign competitor. The foundation ownership system set up in the 1990s is losing its grip. Peter Koh reports from Milan and Rome.
Euromoney December 2006
Shamshad Akhtar breaks the mould in Pakistan. As central bank governor, she has been charged with managing the sudden growth in the country’s banking markets, as well as promoting economic development in some of the country’s more deprived areas – a key tool in the war on terror. Eric Ellis met her in Karachi.
Euromoney December 2006
With spreads on EM sovereign debt at historically tight levels, investors are looking elsewhere to generate alpha. One cutting-edge strategy is to invest in illiquid securities. Hedge funds, in particular, are turning increasingly to these esoteric assets. But the approach is not for the faint-hearted. Sudip Roy reports.
Euromoney December 2006
Roger James finds out why the latest United Utilities water deal continues an amazing year for the UK inflation-linked market.
Euromoney December 2006
The weight of specialized fund and private equity money now chasing infrastructure assets means that everything and anything is up for grabs. Louise Bowman reports.
Euromoney December 2006
Wall Street is praying that the US economy will land softly now that the Federal Reserve has pricked the housing market bubble, because it will be bad news for mortgage origination if house prices stall for long or, even worse, fall. Already there are early signs of credit deterioration in some of the riskier mortgage securitizations. It can only be a matter of time before subordinated CDO tranches start to take a hit. Alex Chambers reports from New York.
Euromoney December 2006
Rapid urbanization poses major challenges for Asia’s developing economies, particularly those lacking government investment. Enterprising Asian developers are now bridging the infrastructure gap alone, creating communities from scratch and reaping handsome rewards in the process. Chris Leahy reports.
Euromoney December 2006
CVRD’s massive financing programme for its takeover of Inco is the most prominent example of a boom in capital markets activity by Latin American minerals producers. Leticia Lozano reports.
Euromoney December 2006
With heavy demand for housing piling on the pressure for additional mortgage funding, Mexico has pioneered RMBS issuance in Latin America. An active real estate market has also prompted as yet unfulfilled moves towards the creation of Reits. Leticia Lozano reports.
Euromoney December 2006
Competitive pressures are driving US banks and corporates to use the new wave of hybrids.
Euromoney December 2006
But will others also shun the obligations foncières structure?
Euromoney December 2006
Over the years various European names have sold dollar bonds using global formats aiming to find non-European buyers. However, few have had much success in the US. This relative failure has been put down to various factors including the lack of familiarity with the concept of covered bonds and an insular outlook among the investor base. But there has already been evidence that things are changing.
Euromoney December 2006
Euromoney December 2006
Barclays Capital says it has joined LiquidityHub, a liquidity aggregator in interest rate swaps and US treasuries expected to start in early 2007.
Euromoney December 2006
Few would have predicted that credit spreads could get any tighter but CPDOs further underpin the market’s strength.
Euromoney December 2006
Tensions between front and back offices over how to price cash CDOs are preying on some industry data providers’ minds.
Euromoney December 2006
Europe gets its LCDS index but settlement disputes mean many banks remain on the sidelines.
Euromoney December 2006
In the latest example of the growing focus on infrastructure opportunities in the ABS market, BNP Paribas has formed a specialized product group in its fixed income securitization business.
Euromoney December 2006
Euromoney December 2006
But proposed exchange believes it will not harm plans to bring new volumes and efficiencies to the forex market.
Euromoney December 2006
Zurich-based JDFX is trying to rebuild its reputation and business.
Euromoney December 2006
Concern that China is poised to diversify its currency reserve holdings has meant some downward pressure.
Euromoney December 2006
Euromoney December 2006
And variance swap strategies remain popular.
Euromoney December 2006
Just six years after deciding that they would be best served by exchanges run for profit and owned by institutions other than themselves, investment bankers have conspired to try to undo their mistake.
Euromoney December 2006
Those who consider the trade reporting fees charged on the London Stock Exchange a thorn in their side are in for some pain relief.
Euromoney December 2006
Rivals wish the Japanese investment bank all the worst.
Euromoney December 2006
First it was the London Stock Exchange. Then Euronext. Then Euronext and Borsa Italiana or maybe just Borsa Italiana. Deutsche Börse clearly wants to do a deal.
Euromoney December 2006
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Euromoney December 2006
Electronic Trading’s lawsuit is shining some light on the opaque world of securities lending. Meanwhile other intermediaries are springing up.
Euromoney December 2006
Recent flurries in M&A in the hedge fund sector have not come out of the blue, says Ted Gooden, partner at M&A adviser to financial companies Berkshire Capital, and more are to be expected in 2007.
Euromoney December 2006
Merger arbitrage has been one of the top-performing strategies of 2006. Paulson & Company is a leading light in merger arbitrage, with well-honed skills in both long and short strategic approaches to deals. Helen Avery reports.
Euromoney December 2006
Euromoney December 2006
Euromoney December 2006
Euromoney December 2006
As the dust settles on the epic $21.9 billion capital-raising from Industrial and Commercial Bank of China, the long-term lessons of the deal – the first simultaneous offer on the Hong Kong and Shanghai stock exchanges – are being considered.
Euromoney December 2006
In many ways Temasek, the investment arm of the Singapore government, looks very much like the US and European private equity powerhouses it competes with for Asian assets. Its business strategy, as defined on its website, is “to invest in companies with high regional or global potential and build them into successful enterprises.” It calls itself a “proactive, long-term shareholder”, which “drives performance and acts as a catalyst for wealth creation and delivery of value”. Spoken like a KKR or Carlyle.
But there’s a big difference:
Euromoney December 2006
Turning a profit by investing in China’s dysfunctional domestic securities markets has proved a perilous occupation for most fund managers. Recent share reforms have helped to improve an appalling investment climate but there is some way to go before China’s domestic asset management industry begins to resemble anything like those of more developed markets.
Euromoney December 2006
The lengthy courtship between domestic Philippine lenders Banco De Oro (BDO) and Equitable PCI Bank (EPCIB) drew to a successful conclusion in November with news that the two banks had finally agreed terms for a merger.
Euromoney December 2006
Holdouts from debt restructuring try new line of attack.
Euromoney December 2006
Dutch bank is eyeing opportunities in credit-driven trades.
Euromoney December 2006
The Chilean government is poised to back a fundamental reform of the country’s celebrated private pensions system so that domestic banks can administer their own pension funds for the first time.
Euromoney December 2006
Hugo Chávez, who seeks re-election on December 3, intends to transfer about $7 billion in international reserves from the central bank to the government’s coffers.
Euromoney December 2006
Euromoney December 2006
Euromoney December 2006
If 2006 was the year that western financial institutions began to cherry-pick Russia’s tastiest retail banking operations, 2007 looks set to see them turn their attention to the country’s investment banks.
Euromoney December 2006
It might not be the most obvious investment, but if emerging market fund managers want to buy a credit that offers long-term potential, they could do worse than invest in Iraqi debt.
Euromoney December 2006
The Saudi Arabian banking sector is waking up from its regulation-induced slumber.
Euromoney December 2006
In what will be a landmark transaction, Privatbank, Ukraine’s biggest bank, is poised to be the country’s first issuer of an asset-backed securitization.
Euromoney December 2006
EBRD’s chief economist urges great investor participation.
Euromoney December 2006
Love him or loathe him – and in Serbia plenty of people do just that – there’s no ignoring Mladjan Dinkic. The first sight that greets – his opponents argue assails – arrivals at Belgrade’s Nikola Tesla airport is a giant poster of the man himself, promoting the G17 Plus party he hopes he will lead to power in parliamentary elections in late January.
Euromoney December 2006
The Bank of Georgia is planning to launch an IPO of its global depositary receipts on the London Stock Exchange.
Euromoney December 2006
Turkey’s banks survived a full-blown crisis this year, but they retain a high risk profile, according to a report by Standard & Poor’s.
Euromoney December 2006
The Nakheel Group has sold a $2.5 billion ijara sukuk, the first equity-linked sukuk to be issued.
Euromoney December 2006
If, as expected, BT uses a bumper securitization to protect itself against LBO predators it might start to give other potential targets ideas.
Euromoney December 2006
The US bank has finally got what it wanted – but it remains to be seen what happens now with GDB.
Euromoney December 2006
How much CPDO volume can be produced before it starts to affect the market of which it is a derivative?
Euromoney December 2006
Archeus Capital’s recent closure suggests that hedge funds should beware of relying on administrators to maintain vital data and should keep their own back-ups.
Euromoney December 2006
The saga of the PCCW takeover does little good for Hong Kong’s reputation as a financial centre.
Euromoney December 2006
Increased competition on cost between European exchanges might lead to liquidity fragmentation. Is there a solution to this?
Euromoney December 2006
Don’t be fooled. The ready availability of liquidity to buy loans of distressed companies in the mid to high 90s is not a sign of health but another symptom of a market that has abandoned rationality.
Euromoney December 2006
Continuing high levels of capital liquidity rest on flows from securitization and derivatives, and from dollar dominance in international trade. Neither source is immune to a violent adjustment.
Euromoney December 2006
Either the underlying money demand relationship on which the M3 reference value is based has failed or there is a lot of pent-up inflation.
Euromoney December 2006
Investment banks are paying fancy prices to participate in the hedge fund boom. Is there method in this or is it madness?
Euromoney December 2006
First there was Pop Idol, then American Idol, and now what amounts to Internship Idol.
Euromoney December 2006
Hong Kong’s hard-working Filipina maids got something to smile about in November when the Philippines’ president, Gloria Macapagal-Arroyo, made an unannounced visit to the territory after duties in Beijing at an Apec meeting.
Euromoney December 2006
YoursMineShag destroyed the opposition at ACI’s annual quiz.
Euromoney December 2006
Things change, as baseball legend and sometime New York Mets player-coach Yogi Berra had his own inimitable way of saying. Some people prefer the future the way “it used to be” – and right now it’s the renaming of the Mets stadium that is upsetting fans.
Euromoney December 2006
It’s not just sports stars and teenagers who appreciate the value of a well-placed brand name.
Euromoney December 2006
Euromoney December 2006
Euromoney December 2006
Chris Garnett interviewed Baudouin Prot, chief executive of BNP Paribas at the recent Euromoney Paris Forum.
Euromoney December 2006
Mark Johnson interviewed to Daniel Bouton, chairman and chief executive of Societe General at the recent Euromoney Paris Forum.