Deals of the Year 2011: Rabobank

New parameters were not the preserve of the SSA market: European FIG was battered not only by sovereign distress but also by grinding regulatory uncertainty throughout the year. Rabobank’s $2 billion 8.4% perpetual non-call tier 1 issue in early November was an answer to both. It achieved the impressive feat of selling the most CRD4 compliant trade to date into one of the weakest market backdrops of the year. Rabobank’s desire to lead from the front on new hybrid instruments prompted the bank to issue an innovative hybrid tier 1 deal in January last year but the November deal was not only the most CRD4-compliant trade to date but was also successfully closed as other issuers – most notably the EFSF – were forced to pull deals from the market because of relentless sovereign-induced volatility. "We were mandated during a period of intense volatility, with an event and headline driven market, multiple EU meetings and announcements, all leading into the G20 summit on November 4," explains Sid Prasad, head of EMEA FIG global finance at Nomura in London. "It was important to find the right issuance window, given the overall nervousness in the market." The deal was launched on Monday October 31 following a strong rally post the EU Summit the previous week. However, that was the Monday that MF Global filed for bankruptcy. The result – exacerbated by uncertainties around the Greek referendum on the Tuesday – was that the EuroStoxx 50 fell by 2.8% on Monday and 5.7% on Tuesday. And the iTraxx financials sub-index widened by 30 basis points on Monday and 62bp on Tuesday.