|Awards for Excellence 2011|
Regional Awards for Excellence 2011: Western Europe
All regions and countries
|Western Europe winners by country |
Best bank: Erste Bank
In 2010 Austrias banks sought to re-engage with their homeland after a busy decade in the regional markets. The bank that has achieved this transition best, while emerging out of the crisis in the strongest shape, is Erste Bank.
The bank has boosted its tier 1 capital to 12.2%, up from 11.5% in previous years. It is also a leading deposit taker, with 117 billion of customer deposits to lift its funding base.
It is making those liabilities work better than rivals are, increasing its operating income by 5.7% to almost 4 billion, over 500 million more than its nearest rival. It has also reduced its cost-income ratio to 48.9%, enabling it to post a 20% increase in profits after tax to 1.5 billion. In total its asset base increased over the course of 2010 to 205 billion.
Erste has edged ahead of its rivals in balance-sheet strength. In May, it received a standalone ratings upgrade from Fitch to B/C, one notch higher than its two main rivals.
Investment bankers operating in Austria in 2010 did most of their work in recapitalizing and reshaping the local banking sector. Deutsche Bank did more for this sector than any other bank. It also secured several non-bank deals, all underpinned as usual by its strong flow and equities businesses. In DCM it completed Raiffeisens 1 billion issue, the first senior bond by an Austrian bank for three years. It followed this up in September with österreichische Kontrolbanks $1 billion five-year deal. Its 515 million convertible tender and new issue for Immofinanz in February 2011 further built its FIG credentials. This mandate stemmed from its role as financial adviser on the 2.8 billion merger of Immoeast and Immofinanz in April 2010. It also was one of the banking groups that advised on the merger of RZB and Raiffeisen International in October 2010. This rationalized the banks local and international structure.
It was not all FIG work, however, as demonstrated by the 180 million capital increase it ran for EVN, the local energy company.
The broken Belgian banking system was rebuilt in 2010. This culminated in the emergence of two well-capitalized local incorporations of Western European banking groups as the leading banks in the country. BNP Paribas Fortis edged slightly ahead of its main rival in its efforts to build the Belgian-focused business as a distinct local bank.
It has done this through extending new product offerings to its corporate clients, such as BNP Paribas Fortis Factoring, as well as bringing international cash management products from its global platform into a local context. It has added 1,250 local staff and has used its Belgian base to house international competence centres in cash management, trade finance and factoring.
This all culminated in a strong financial performance. BNP Paribas Fortiss consolidated profit before discontinued operations was 1.18 billion, a creditable performance even if it is still dealing with the legacies of 2008/09.
The combination of strong flow business in the secondary debt and equity markets and leading roles in some of the most prominent deals of the year makes Deutsche Bank the best investment bank in Belgium.
Its strong distribution platform enabled it to play important roles in arranging financing for Belgian financial institutions, which continue their slow progress back to safe levels of capitalization. It was the lead bookrunner on Dexias April 2010 $4.5 billion four-year government-guaranteed issue. This was part of a continuing mandate to help deleverage and recapitalize the bank. It was also a bookrunner on the largest bond to come out of the country in the award period: the 5 billion issue from the Kingdom of Belgium. In equity, it worked on the 490 million rights issue for Nystar, which had a relatively steep 27% discount but still proved successful in the aftermarket.
In M&A, Deutsche advised on Groupe Bruxelles Lamberts increase of its stake in Imerys from 30.7% to 56.4% as well as advising on the acquisition of Movetis by Shire.
Underlying this is its number one position in Belgian FX, flow and equity markets, giving it the strong secondary market credentials to secure primary investment banking mandates.
Best bank: Bank of Cyprus
Bank of Cyprus was intimately involved in one of the most important capital market stories of the year the development of the contingent convertible bond market. As banks and regulators weighed the merits of the new instruments, Bank of Cyprus pressed ahead with its own debut convertible enhanced capital security essentially a CoCo bond that also gives bondholders the right to convert. The deal was overwhelmingly sold to domestic investors but it provided an important blueprint for the development of the structure as it incorporates both upside and downside for investors. As Euromoney went to press the bank was preparing a follow-up issue to its successful debut.
Away from the CoCo market, Bank of Cyprus has faced a tough year as a result of its close relationship with Greece. The bank has high exposure to its neighbour with 35% of group loans advanced there. Problem loans have increased from 8.5% at the end of 2009 to 12.4% for 2010 and are likely to rise further. First-quarter profits were down 13% a result of increased provisioning costs and the governments new 0.0095% bank levy on deposits, which has cost the bank 5 million. It made 71 million in the first quarter (having announced a full-year profit after tax for 2010 of 306 million). It expects to achieve roughly the same for full-year 2011.
Moodys downgraded Cypruss sovereign rating from Aa3 to A2 in the first quarter of this year, resulting in a downgrade of Bank of Cypruss long-term debt and deposit ratings to Baa2 from A3. Asset-quality deterioration will be a challenge for Bank of Cyprus over the next year, but thanks to its deposit profile it has a strong liquidity position and a healthy tier 1 capital adequacy ratio of 11.1%.
Best bank: Société Générale
Société Générale led the way among French banks last year in boosting its share of domestic retail business, attracting deposits and inflows to savings products while also growing its loan book. The bank operates three retail platforms in its own home market, including the Société Générale branch network, with 8.5 million customers, the seven regional banks that make up Crédit du Nord, with 1.9 million customers, and the countrys leading internet bank, Boursorama. All three were busily marketing themselves last year.
Leaving aside acquisitions, deposits grew by an impressive 11.9%, bringing the loan-to-deposit ratio down from 139% to a more manageable 128%, while allowing room for loans to increase 4.1%, with mortgage lending up by 8.9%. With a steady net interest margin, the banks revenues in domestic retail grew by 3%, a good result according to equity analysts.
The banks strategy for winning over customers relies on strong brand positioning in the market for younger people, with attractive pricing and a diverse range of services comprising a banking package with free banking services, online access for one year, a 1,000 line of credit at 0% interest, and an innovative non-banking package granting music extras for owners of the co-branded SG/Universal Music card.
The online bank offering also comes out well for value for money in customer surveys and continues to innovate. Customers can now modify their withdrawal and payment limits, file a mortgage application online, send cheques without a chequebook, and consolidate and manage all accounts including those maintained with external institutions using a single tool, MoneyCenter.
Completion of the rollout of the eight regional SG private banking centres means the bank can now, for the first time, provide nationwide coverage and a high-quality service to its high-net-worth customers.
The bank continues to extend long-term credit vital to the domestic economy in key infrastructure projects. It was one of four initial mandated lead arrangers and hedge providers on the 9.5-year, 1.59 billion senior debt financing for the pathfinder virtual power project Exeltium, based on an innovative partnership between EDF and leading industrial companies in France (April 2010).
BNP Paribas boasts one of Europes strongest and most profitable corporate and investment banking divisions and this has been busy in the past 12 months as the winning provider of advice and often finance to enable French companies to complete M&A transactions. Among its largest and most noteworthy assignments, BNP Paribas acted as adviser to GDF Suez in the complex transaction through which its shareholders took control of International Power. In the pharmaceuticals sector, it advised Sanofi-Aventis on the acquisition of Genzyme, while also acting as a mandated lead arranger and bookrunner on the associated $15 billion credit facility and being a bookrunner on the $7 billion bond takeout. It was an adviser to EDF on the sale of its UK distribution network; to Vivendi on the acquisition of GVT; and to hospitality company Accor on the demerger of its business services division, Edenred.
In many of these M&A transactions BNP Paribas faced off against its great domestic rival, Société Générale, advising the other side. Société Générale narrowly pips it to win the best equity house award. SG CIB led twice as many equity capital markets transactions for French issuers as its great rival.
In equity-linked products, with seven bookrunner positions out of nine transactions in France, SG CIB showed its ability to provide optimized financing to several mid-cap and large-cap companies, tailoring equity-linked instruments to their specific needs. The Artemis exchangeable bond was the most visible transaction, reopening the French equity-linked market after a four-month period when there were no important transactions because of the sovereign debt crisis.
SG CIB provided ways for various sellers to monetize stakes in listed companies, including Xavier Niels 54 million block in Iliad and One Equity Partners 261 million block in Faurecia.
SG CIB was sole bookrunner for two out of the three small-cap IPOs over 20 million, including the 23 million flotation of Stentys, which occurred in an adverse market environment after the cancellation of several IPOs.
It led the 97 million rights issue of Compagnie des Alpes as part of a broad financing plan to fuel the acceleration of the strategic reorientation of the ski resorts company.
In debt capital markets, BNP Paribas takes the plaudits. It leads the bookrunner rankings by a wide margin over its closest rival, with a 15% market share compared with 11.5% for SG CIB. French companies were among the most active issuers of euro-denominated bonds last year but BNP Paribas distinguished itself by also leading key deals in other currencies, notably dollars and yen. It was the active joint bookrunner on the inaugural $7 billion six-tranche issue for Sanofi-Aventis, which generated more than $17 billion of demand. BNP Paribas was also joint bookrunner on Renaults ¥45 billion ($560.8 million) two-year offering, the first by a non-investment-grade corporate in the samurai market.
BNP Paribas also played a leading role in 15 of the 17 liability management exercises in the period under review by French clients, often buying in old bonds and issuing new ones to lock in low rates, extend maturities and reduce cost of carry. These included notable deals for Saint-Gobain, EDF, Casino Guichard-Perrachon and Air Liquide.
Best bank: Deutsche Bank
The German banking sector has had a difficult year and its problems might be about to get worse. According to the Bundesbank, German banks have 137.5 billion of exposure to peripheral eurozone states including 29.5 billion related to Greece. This might have serious consequences were the sovereign situation in the region to deteriorate. Germany has also passed a Bank Restructuring Act (which came into law in January this year) that allows regulators to transfer the assets and liabilities of a failing bank while permitting the government to write down debt. The legislation prompted the rating agencies to downgrade 24 billion of German banks subordinated debt securities. The banks are also battling the regulators over proposals to disqualify silent participations (stille Einlagen a form of non-voting hybrid capital) from bank capital ratios. If this happens it will leave many banks scrambling to find an alternative.
As the sector struggles, the contrast between Deutsche Bank and the rest of the domestic pack grows ever starker. Deutsche dominates banking in Germany: in 2010 the income it generated from the country grew by 25% to 6.5 billion and it now has 15% of the German investment banking market. Thanks to the December 2010 acquisition of Postbank it is now also the biggest private-sector retail bank in Germany, with 24 million private clients and 260 billion of retail deposits. Deutsche was involved in almost every important ECM, DCM and M&A deal in the country last year and was instrumental in efforts to repair balance sheets. It arranged nearly all of the big recapitalizations, including the 16 billion FRN for FMS-Wertmanagement in December 2010 that refinanced a large part of the governments bailout of the HRE Group.
Equity new issuance in Germany was up 28% year on year. Goldman Sachs built on its strong position in the market, executing four of the five largest equity transactions in three cases as sole bookrunner. It was sole books on the 1.78 billion secondary accelerated bookbuild for Continental, which was the largest such deal ever executed in Germany for a non-financial issuer.
According to Dealogic, Morgan Stanley has a 30% share of the German M&A market and has been involved in more than 20 deals over the past year. One of the more important was the 4.7 billion sale of EDFs 45% stake in Energie Baden-Württemberg to the German state in February. The US bank was sole financial adviser to the government of Baden-Württemberg on the transaction, which enabled it to pre-empt uncertainty around ownership of a key infrastructure asset in Germany. Morgan Stanley was also lead financial adviser to Deutsche Telekom and T-Mobile USA on the sale of the latter to AT&T, which will further cement its position in German M&A if the deal is successfully completed.
Best investment bank: Morgan Stanley
Euromoney is not making a best bank in Greece award this year. However the market for investment banking has been and will continue to be active. Given the market environment, every deal to come out of Greece in the past 12 months is something of a triumph. Morgan Stanley has worked on the most important deals across the widest array of products in the market, making it the best investment bank in Greece. This should set it up well for the potential fee bonanza from the upcoming IMF-mandated 50 billion privatization programme.
Given the background of continuing sovereign troubles, each deal attained some level of controversy, not least the double restructuring of Wind Hellas, on which Morgan Stanley acted as sole financial adviser to the company. In the banking sector it worked on capital increases for both National Bank of Greece and Piraeus Bank, raising a combined 1.625 billion of fresh capital for Greeces troubled banking sector.
It was also one of five bookrunners on the three-year, 500 million bond deal for OTE, the telecom company that reopened international capital markets for Greek companies. These deals along with its IPO of shipping company Costamare should position it well for the range of financing options being examined by the government as it seeks to extricate itself from its fiscal hole.
Best investment bank: Credit Suisse
Euromoney is not making a best bank in Ireland award this year. Irish banks have endured a terrible year and now face the prospect of the entire sector ending up under majority state control. At the end of March the central bank announced a funding requirement for the restructured sector of 24 billion and the Irish government has subsequently imposed aggressive bail-ins on subordinated bondholders of Allied Irish Banks and Bank of Ireland. Both of these universal banks still face challenging capital-raising programmes to restore the countrys banking sector to some semblance of normality.
These kinds of problems require skilful investment banking advice. Credit Suisse has been involved in some of the key capital market initiatives over the past 12 months. It has been instrumental in Bank of Irelands capital-raising plans, co-underwriting the banks successful 1.7 billion rights issue (which was 94.6% taken up) and advising on the sale of a portfolio of loans to the National Asset Management Agency. Together with Deutsche Bank and UBS, Credit Suisse is advising Bank of Ireland on its subordinated debt buy-back and rights issue, part of the 4.2 billion (plus 1 billion of contingent capital) that it needs to raise by the end of July.
Credit Suisse is active across the board in Ireland and is ranked number three in Irish M&A for the period under consideration. It was involved in several M&A deals, including Mylans acquisition of Bioniche Pharma Group, Ardagh Glasss acquisition of Impress Holdings and Misyss purchase of Sophis SCA. It ranks fourth in DCM and number two in ECM, having among other business co-underwritten an accelerated bookbuild for Smurfit Kappa Group that raised 212.5 million.
Best bank: Intesa Sanpaolo
Best investment bank: Goldman Sachs
While UniCredit tries to get its house in order under new chief executive Federico Ghizzoni, Intesa Sanpaolo continues to outperform its local rival.
Thats not to say that Intesa hasnt faced its own issues, including a recent downgrade alongside the Italian sovereign rating. But Intesa is showing momentum.
Net income for the first quarter of 2011 was 661 million, up 30% on the fourth quarter of 2010.
Intesa has also built a solid capital base. Following a 5 billion capital increase in June this year, the banks core tier 1 ratio stands at 9.8%.
Intesas core Banca dei Territori division, which accounts for 56% of group income and covers retail, private and SME customers, has produced steady operating income throughout the past 12 months, reduced operating costs and improved its cost income ratio to 59% in the first quarter of 2011 from 62.4% in the fourth quarter of 2010.
The groups risk profile is strong, with stable and diversified sources of funding. Exposure to the distressed EU countries is limited: at December 2010 the groups securities portfolio had just 770 million exposure to Greek central and local governments, and 66 million to Portugal.
Goldman Sachs is the clear leader among international investment banks in Italy. In M&A it had a 68% market share by deal value, and was involved in most of the key transactions. Notable among these were the $22.4 billion acquisition of Weather Investments by Vimpelcom; the $18.5 billion spin-off of Fiat Industrial; and a complex share swap with a total value of $14 billion involving CDP, the Italian treasury, Enel, Eni and Poste Italiane, in which Goldman acted as sole adviser to the CDP board.
In equity, Goldman was among the top-three-ranked international houses and was a global coordinator on the landmark deal of the year, a 2 billion IPO of Enel Green Power.
In debt, not traditionally Goldmans strongest suit, the firm also performed well, ranking fifth for private-sector issuance and second in unsecured FIG issuance over the period.
Best bank: Rabobank
Bank customers in the Netherlands must continue to give thanks that in triple-A-rated Rabobank the country boasts one of the strongest and most stable cooperative lenders, providing basic banking services to the retail and corporate markets without trying to gouge out excessive profits.
A modest recovery in 2010 benefited Rabobank financially. Net profit grew by 26% on 2009, recovering to 2.77 billion. This profit was used to further strengthen its already strong equity and Rabobanks tier 1 ratio increased by 1.9 percentage points to no less than 15.7%.
Rabobanks liquidity position also remains resolutely robust. More than 40 billion was raised in long-term funding last year, with remarkably long maturities, up to 100 years. As the economy grew and the financial system crisis appeared to ease, Rabobank still held on to its market shares in the Netherlands, which expanded in 2008 and 2009. It remains the countrys largest mortgage bank, savings bank and insurance broker, and leading banker to the SME sector.
JPMorgan wins the best M&A house in the Netherlands award. Although it has advised on fewer transactions than its great local rival, ING, the US bank has advised on a higher value of deals in the period under review. Moreover, these were often both complex and time constrained.
After a strategic review of Maxeda Fashion, JPMorgan designed a bespoke sale process in which four transactions were run simultaneously (V&D Group, de Bijenkorf, Hunkemöller and M&S Mode). These were announced over a period of two months, while the bank helped its Dutch client reach out to international buyers.
JPMorgan was the exclusive financial adviser in the sophisticated defence strategy for cable company Draka through the creation of a premium value-creating alternative transaction, ultimately leading to its sale to Prysmian of Italy in a highly sensitive situation following unwelcome approaches from Chinese bidder Xinmao and also, as it later emerged, Frances Nexans.
JPMorgan structured and ran a complex dual-track exit process for Doughty Hanson to maximize competitive tension and keep full flexibility in high market uncertainty, ultimately resulting in the sale of Impress to Ardagh Glass.
RBS has been the most active firm in the Dutch equity capital markets, with a bookrunner role on five of the 10 most important transactions spread over four sectors and three different deal types: rights issues, accelerated book-built offerings and block trades. The fixed-price, fully underwritten rights issue for Dockwise with limited discount to Terp is an example of the primary market capabilities RBS is providing to its clients. As a result of its extensive distribution channels, RBS was able to outsell its competitors when it came to the 187 million accelerated book-built offering for Imtech.
In addition, RBS has been active as share buy-back agent on 55% of all share buy-back volumes in the Netherlands in 2010/11 year to date.
RBS, which took over and reorganized the old ABN Amro equities platform, combines its local knowledge and presence in the Netherlands with the reach of a powerful international equities business. It is the only equity house in Amsterdam to be on all the core broker lists of Europes top 100 investors.
Four of RBSs Amsterdam-based analysts were ranked in the top six "Best individual analysts for Benelux" in the Extel 2010 survey. RBS provides research coverage on 48 of the 50 largest companies in the country and a total coverage of 60 companies.
Deutsche Bank tops the debt capital markets bookrunner rankings for deals for issuers from the Netherlands. It raised more than $6 billion for ING in the US dollar covered bond market and through senior unsecured euro and dollar transactions in public and private placement format. It raised 3 billion of covered bonds for ABN Amro.
Other standout transactions included Ziggos 1.2 billion and 750 million high-yield offerings, the first being the largest Dutch high-yield deal in 2010/11; KPNs 1 billion cash neutral tender and refinancing liability management exercise, which attracted 2.5 billion of demand from high-quality investors; and Energie Beheer Nederlands SFr450 million ($535 billion) bond in April 2010, the first Swiss franc corporate bond of 2010.
Best bank: Santander Totta
Santander Totta has benefited from being the best rated of the leading Portuguese banks, according to Fitch and Moodys, and also the most strongly capitalized. It has a low non-performing loan ratio of 1.5%, with provision coverage of 125% of these bad loans, and a tier 1 capital ratio of 11.2% and core capital ratio of 10.3%.
Deposits increased by 13% in the period under review, meeting a key target of the bank in a period of tensions around Portugals sovereign debt spilling over into the funding markets. Deposit funding has allowed it to maintain moderate loan growth to the SME sector.
Combine all this with the operational efficiency that is a trademark of banks long part of the Santander group and now stands at 45.7% and Santander Totta has also been highly profitable. Its return on equity is 15%, while that of its four main rivals in Portugal ranges between 5% and 9%.
Conditions remain difficult in Portugal and the bank sees little choice but to deleverage and reduce its loan book. At least in doing so it remains a dependable presence and reliable provider of cash management and other products such as factoring to Portuguese companies.
The investment banking arm of Banco Espírito Santo has been the leading M&A adviser in Portugal in the period under review, working on twice as many deals as its closest competitor, according to Dealogic, and topping the adviser rankings by deal amount. The firm has 33 professionals based in Lisbon working full time on M&A advisory for large and medium-sized companies across six industry sectors. These bankers often find themselves working for cross-border deals for Portuguese clients into Brazil and Spain.
So, for example, it acted as a financial adviser to Portugal Telecom in the disposal of its 50% stake in Brasilcel (Vivo) to Telefónica for a total consideration of 7.5 billion, one of the largest M&A deals ever for a Portuguese company.
Brasilcel was the holding company, owning 60% of the share capital of Vivo, the leading Brazilian mobile operator, with 56 million subscribers. Portugal Telecom has been in Brazil since 1998 and, jointly with Telefónica, contributed to Vivos success in consolidating leadership in the Brazilian mobile market. The deal enabled Portugal Telecom to crystallize a large sum.
Banco Espírito Santo also advised Portugal Telecom on the acquisition of 35% in LF Tel and Andrade Gutierrez Participações and of 10% in Telemar Participações (Oi). Following its exit from Vivo, this enabled Portugal Telecom to maintain its presence in Brazils large and fast-growing market and take a stake in the only national operator with a fully integrated service offering under a single brand.
This was also the first step in a strategic partnership with Oi through which Portugal Telecoms total disbursement will reach 3.7 billion and Oi will acquire up to 10% of Portugal Telecoms share capital. This strategic partnership aims at developing a global telecommunications platform fostering cooperation and further international expansion in Latin America and Africa.
Banco Espírito Santo also worked on more equity capital markets deals in Portugal than any of its competitors. It was global coordinator and bookrunner on its own BES/EDP 500 million exchangeable bond issue. It was global coordinator of football club Sporting Lisbons (Sporting SAD) 73 million rights issue and mandatory convertible bond issue and of two rights issues for IT company Reditus, raising a total of 32 million to support acquisitions.
As an equity trader, Banco Espírito Santo, which has 13 analysts covering the leading Portuguese stocks, was top ranked on NYSE Euronext Lisbon, with an 11.9% market share.
CaixaBI dominates the Portuguese debt capital markets bookrunner rankings, having led 18 deals worth 3.3 billion, giving it a 27% market share, compared with five deals worth 1.2 billion for second-placed Deutsche, which has just under 10% market share.
Caixa is a leading primary dealer in Portuguese government bonds. It was bookrunner in Portugals only syndicated issue of the period, the OT 6.4% due 2016, which successfully ended a prolonged absence from the market for the Republic in February 2011. Showing there is still room for innovation and structuring in the Portuguese market, Caixa was sole arranger of the largest residential mortgage backed securities transaction in the country to date, Nostrum Mortgages No 2 in November 2010.
Best bank: Santander/Banesto
Through its two main units, the Santander branch network and Banesto, Santander has continued to outperform in its home market over the past 12 months, even as Spanish retail operations continued to fall as a proportion of the groups business to just 13% of profit in Q1 2011.
Santander shifted its focus to capturing new deposits, clawing back market share lost to the now beleaguered cajas during Spains boom years, and kept non-performing loans below the industry average, at a combined 4.57% compared with 5.83% for the sector.
The Santander network achieved lower gross income but this came from a rebalancing of its loan-to-deposit ratio, from 159% in 2009 to 130% in 2010. Banesto provided a similar story, reducing its loan-to-deposit ratio from 136% to 127% over the same period. Deposits rose by 18%, in part through some innovative retail offers. Notable among these was Banestos World Cup-related Depósito Selección, on which the interest rate rose from 3% to 4% when Spain won footballs most prestigious competition. Banestos return on equity was the best in the sector, at 8.4%, compared with Sabadell at 7.3% and Popular at 7.1%.
With the sovereigns financial position in great difficulty, it has been a challenging period in which to raise debt capital for Spanish issuers. However the sovereign has led the way with a series of well-received deals; and Spanish debt activity has remained relatively buoyant, notably financial institutions issuance.
Among international debt houses, Deutsche Bank, Barclays and HSBC have all had successful years. HSBC, however, takes the best debt house award because of the range of products it has brought to market (from sovereigns through to ABS), the multiple currencies of issue (including Mexican peso and Norwegian krone) and for all types of client.
HSBC has also received multiple mandates from the most important names in the Spanish market: it led senior and covered bonds for Santander and BBVA; and it brought three deals to the market for Telefónica over the review period.
Activity in the Spanish primary equity markets was relatively subdued, but the battle for top spot was a close-run affair between Goldman Sachs and JPMorgan. The best equity house award goes to JPMorgan for a stellar end of 2010 after a difficult period for Spanish markets. The US bank led a 617 million sale of shares in tech company Amadeus on behalf of a private equity consortium in October; it followed this up in November with BBVAs 5.1 billion rights issue, to finance the banks acquisition of an 18.6% stake in Turkeys Garanti Bank. It ended the year on a high with media company Telecincos 500 million rights issue.
Morgan Stanley is the best M&A house in Spain, topping the league tables during a very busy period in the sector. The US firm has advised on a wide range of complex transactions and shown particular expertise in cross-border transactions. These included the 7.5 billion acquisition of a Portugal Telecom stake in Vivo by Telefónica; the 10.3 billion merger between British Airways and Iberia; and the sale of a 6% stake in Iberdrola to Qatar Holding worth 2 billion.
Morgan Stanley has also taken a leading position in the financial institutions sector: it advised BBVA on the Garanti trade, and advised on the sale of AIBs Polish interests to Santander. It has also played a key role in reshaping the countrys troubled savings bank sector.
Best bank: Credit Suisse
Credit Suisse still derives about 40% of its pre-tax income from its home market and once again wins the best bank in Switzerland award.
Having successfully navigated through the financial crisis and emerged as a clear winner, Credit Suisse maintained its strong momentum with clients in the period under review and gained market share in core segments. In particular it achieved strong net new assets of SFr14.4 billion ($17.1 billion) in Switzerland, underscoring the trust that clients place in the bank. Its tier 1 ratio of 18.2% might make it difficult to generate high returns for shareholders, but to its 1.4 million private and retail Swiss customers and its 110,000 corporate and institutional home-market clients this looks like a pillar of strength. And according to figures from the central bank, it also grew its market share of loans in the period under review.
Together with its subsidiary Swiss Venture Club (SVC), Credit Suisse is providing up to SFr100 million of capital to help sound Swiss businesses with limited access to additional capital to achieve their growth targets. One of the first companies to benefit from the funding is HeiQ Materials, a Swiss speciality chemicals company. SVC invested funds for a minority equity stake in HeiQ. As a result, HeiQ was able to reach out to other interested parties and raise the necessary new capital.
Credit Suisse has been upgrading branches to serve affluent retail customers and has rolled out new investment products to help clients cope with near zero interest rates and new tools to enhance its advisory approach, including the Portfolio Risk Analyzer through which relationship managers assess clients portfolio risk using various concepts for either mild markets or wild markets. This enables clients to better understand their investment portfolios and ensures that clients decisions are based on a solid foundation. It has been very well received.
UBS is the best M&A house in Switzerland, having advised on a larger number of transactions and for a greater aggregate value than any other firm in the period under review. UBS confirmed its leading position in financial institutions advisory in Switzerland as exclusive adviser to Allianz on the disposal of its three Swiss subsidiaries, Alba General Insurance, Phenix General Insurance and Phenix Life Insurance, to Helvetia Group for SFr302 million.
In several landmark transactions, UBS demonstrated its ability to facilitate cross-border M&A transactions into and out of Switzerland. UBS advised TDC on the SFr3.3 billion sale of its Swiss subsidiary, Sunrise, to CVC Capital Partners. This transaction was the third-largest leveraged buyout in Europe in the awards period.
UBS also acted as exclusive financial adviser to Baldor Electric on its $4.2 billion sale to ABB, the largest acquisition in ABBs history.
UBS also heads the equity capital markets bookrunner rankings for Swiss issuers in the period under review and its expertise in equity markets and M&A has been mutually reinforcing.
For example, the bank acted as financial adviser, sole global coordinator and joint bookrunner on OC Oerlikons complex financial restructuring, which re-established a sustainable capital structure through, inter alia, a SFr1 billion rights issue. UBS also proved to be a reliable and trusted partner to the client on the lending and commercial banking side throughout the restructuring.
In March 2011, UBS acted as financial adviser to Rieter Holding on the announced separation of its automotive systems division from its textile systems division, creating two separately listed companies (Rieter Holding and Autoneum Holding).
As part of the refinancing of two acquisitions, UBS advised Aryzta on two highly successful capital market transactions. First, it acted as sole bookrunner on Aryztas 24-hour, SFr140 million private equity placement. UBS proposed the placement to Aryzta instead of the originally envisaged share component to the sellers, which avoided flowback issues by placing the shares with long-term investors identified through UBSs ECM platform. Secondly, UBS acted as sole structuring adviser and joint bookrunner on Aryztas SFr400 million hybrid bond. This successful transaction was only the second corporate hybrid offering ever in the Swiss franc bond market.
UBS advised on the only two convertible bond issuances in Switzerland in 2010. It acted as joint bookrunner on a SFr300 million convertible bond for Swiss Prime Site. In addition, it advised Mobimo as lead manager and sole bookrunner on its SFr175 million convertible bond.
Credit Suisse wins the best debt house in Switzerland award. It leads the debt capital market bookrunner rankings with a 37% market share, compared with UBSs 29%. It led deals for Arbonia Forster, Lonza, Georg Fischer, Holcim, Galenica, BKW, ENAG and SGS among others in the domestic segment of the Swiss franc bond market. Credit Suisse was the only lead manager that participated in all domestic hybrid transactions, which were Hero (reopening), Aryzta, Helvetia, Zurich Insurance and Swiss Life.
In addition, its debt capital markets team in Zurich covering international issuers played a lead role in bringing a diverse group of borrowers to the domestic Swiss franc bond market, including many European banks selling both unsecured and covered bonds and also emerging market names.
Best bank: Barclays
The UKs banking sector continues to face big challenges, from a faltering economy and a moribund mortgage market, as well as regulatory pressures the latest being plans announced by chancellor George Osborne to force banks to ring-fence their retail operations.
In this environment, Santander has continued to build market share. But its next task is to attract retail customers rather than to acquire them, which it so far has done either through buying smaller operations or offering ultra-competitive pricing and to improve customer service. It also needs to deliver on its promise to build an SME platform, for which the purchase of Williams & Glynn from RBS will provide impetus.
Of the traditional big high street banks in the UK, Barclays is the best performer. It has been on the acquisition trail, notably in the credit card sector, where it has taken on Eggs credit card assets, amounting to £2.3 billion ($3.7 billon) of receivables.
In 2010 Barclays provided £36 billion of gross new lending to UK households and added an additional £7.5 billion of loans to its balance sheet through the acquisition of Standard Life Bank. It has also pioneered contactless payments in the UK.
In UK retail and business banking, Barclays increased profit before tax by 21% in the first quarter of 2011 compared with the first quarter of 2010, driven by a strong performance in reducing impairment. Income and operating expenses stayed stable, leading to a return on risk-weighted assets above the banks target threshold.
A busy 12 months in sterling fixed income had the big-three UK banks HSBC, Barclays and RBS in tight competition for the top league table spot.
HSBC just edged into first place and also edges the award for best debt house in the UK, thanks to the range of deals that it has brought to the market in often challenging conditions. No deal demonstrated this better than its work for BP following the Gulf of Mexico oil spill, culminating in a return to the sterling market in March 2011. Also in the corporate sector it took a lead role in unrated Thomas Cooks crossover dual-currency issue, managed the whole-business financing for Gatwick Airport, launched Virgin Medias first investment-grade bonds, and brought Tesco to the market with the two largest commercial property backed bonds since 2007.
HSBC was also busy in FIG, as joint bookrunner on three of the first four sterling covered bonds. In the sovereign sector, it led the UK Treasurys largest ever index-linked transaction, weighing in at £6 billion.
Barclays Capital has big ambitions in the global equity capital markets. Thats work in progress, but its successes over the past 12 months in its home market will offer those inside the firm hope that it can realize its ambitions.
BarCap topped the league tables during the 12-month period under review an achievement in itself for a firm that ranked 15th over the equivalent period the previous year. Thats even more impressive considering that Barclays is still a relative newcomer to the UK corporate broking business, in which it won seven FTSE 100 mandates during the period under review.
Transaction highlights include the £2.1 billion rights issue for insurer Resolution, which involved the introduction of an innovative fee structure; and the £900 million IPO of Justice Holdings, the largest blind pool vehicle ever listed.
JPMorgan has been the big beast of the UK mergers market since its integration of Cazenove, and leads the league tables again this year. But the momentum house in the UK is Morgan Stanley, which had a superb 12 months in UK M&A, acting on many of the high-profile transactions.
Principal among these was its role in the complex merger of International Power and GDF Suez, worth £25 billion. Morgan Stanley had multiple roles on the transaction, acting as joint financial adviser, sponsor and corporate broker to International Power. In another cross-border coup, the US bank acted as adviser to Dana Petroleum in its $2.8 billion takeover by Korea National Oil Corp.