Awards for Excellence 2018
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As global banks have pulled personnel back from CEE over the past decade, a divide has opened up between the big regional lenders and the bulge-bracket groups.
The former are mainly western European groups – the likes of Erste, Raiffeisen and Intesa Sanpaolo – with extensive commercial banking networks but limited international investment banking expertise. That tends to be provided by the big US banks, most of which now serve the region from London hubs.
Société Générale is one of the few banks that manages to bridge this gap. The French group is one of the main commercial banking players in CEE, with a network comprising the second-biggest foreign bank in Russia, the number-three lenders in Romania and the Czech Republic, an outpost in Poland and a clutch of subsidiaries in smaller markets in southeastern Europe.
At the same time, it boasts a sophisticated advisory business backed by enhanced acquisition and structured finance capabilities, as well as a strong capital markets franchise with good global distribution.
In CEE Eurobonds, Société Générale acted on more transactions in the 12 months to the end of March than any international bank except Citi and JPMorgan. A flood of Russian corporate issuance and liability management last year accounted for a large chunk of the total, but Société Générale was also very active in Turkish financial flows.
Other notable mandates included a clutch of euro-denominated sovereign deals, including Poland’s second green bond and the first international deal from the Czech real estate sector.
Société Générale also maintained its position as the leading private-sector player in the rouble bond market in Russia, as well as providing domestic bond market capabilities in Romania and Czech Republic.
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| Cécile Camilli |
Cécile Camilli, head of Ceemea DCM, says this combination of local bond platforms with international teams in London, Warsaw and Paris gives the bank a unique competitive edge with issuers.
“We are able to present clients with a holistic product offer across all asset classes – local currency, euros and dollars – without any bias,” she says.
The mix of local presence and international expertise has also proved a winning formula on the advisory side, as demonstrated by Société Générale’s role in the acquisition of the JDR Cable Systems in the UK by Tele-Fonika Kable.
The French bank acted as buy-side adviser to the Polish firm and was also a key player in the associated Zl1.65 billion ($443 million) strategic and acquisition financing, which included a term loan, revolving credit facility and guarantees, as well as complex hedging requirements.
“Acquisition finance has always been one of the strengths of Société Générale,” says Laurent Cassin, head of ECM for Northern Europe, Ceemea and Russia. “We love to deploy our balance sheet on large situations and technical products.”
Société Générale’s presence on deals such as the €1.4 billion sale of EDF’s Polish assets to PGE testify that the firm’s ability to win advisory mandates is not dependent on its balance-sheet capacity.
This is also evidenced by the bank’s success in the Turkish market, where it has managed to maintain a top-three M&A franchise despite ample domestic liquidity and intense competition from local banks and boutiques, as well as global players.
Highlights in the awards period included acting as sole buy-side adviser on Australia’s IFM Investors acquisition of a 40% stake in Mersin Port for $869 million, as well as helping Abraaj on its purchase of Netlog, Turkey’s largest logistics provider.
Equity capital markets is Société Générale’s weaker link in CEE, but nonetheless the group notched four mandates last year, including on Digi’s $208 million debut in Bucharest and as the only continental European bank on the $1.5 million IPO of En+ in London.
