Brazil: special focus
Russia: special focus
India: special focus
China: special focus
Emerging markets: special focus
Swiss bank buys Brazil’s biggest multi-family office; wealth management industry continues to grow fast despite economic turbulence.
Latin America: Data talks big in Brazil – for now
The country’s biggest banks are working on the big data challenge. If successful, it could transform the industry and its performance. But quantifying the impact and differentiating between potential winners and losers is almost impossible.
When Brazilian bank holidays meet financial regulation
What gated communities can teach us about gaming the system.
Latin America: Politics puts Brazil in a spin
The latest political scandal in Brazil spooked the markets, but didn’t bring them down. Why not?
Country risk: Russia is on the long road back
Experts are beginning to feel more confident about Russia’s prospects, and its credit ratings will ultimately reflect this.
Asia: State Bank of India sets global strategy
Bedding down a six-sided merger domestically; international activity to be 20% of total book in three years.
Bernardo Parnes opens IB and wealth management boutique; consultancy aims to differentiate by seniority of advisers.
Brazil: Bradesco BBI aims to become regional investment bank
Was Brazil’s crash an opportunity or the end of a bull run?
Brazil’s XP chooses a road often travelled: selling to Itaú
Latin America: NPLs point to credit quality recovery in Brazil
Private banks ahead of the curve in terms of provisioning; Banco do Brasil returns to double-digit ROE.
Whip-smart M&A boutiques and upstart full-service investment banks are making waves in India, profiting from the retreat of global investment banks. But how much further can they go?
The decision by Moody’s to lower its sovereign rating on China was flagged-up in ECR’s crowd-sourcing survey more than a year ago, and it will mean higher funding costs in the offshore market.Santander Brasil begins to win converts to its turnaround story
Credit Suisse switches to outperform rating; Santander expected to quickly close the profitability gap with its peers.
Brazil’s bankers hope Azul is green light for more IPOs
Brazil: not as boring as it looks
India’s banks dial in on demonetization
Indian banks respond to Modi's demonetization shock therapy
India: It’s a woman’s world
Ashish Kumar Chauhan: India’s stockbroking supremo
Latin America: Lenders warming up to Brazilian banks
Recent IFC deal for Banco Daycoval outperformed initial expectations; IFC sees changing role in Brazil as interest rates fall.
Credit Suisse books Brazilian profits and switches to Malaysia; crowded trade hints at heated valuations.
Latin America: Goldfajn plots a happy ending for Brazil interest rates
The new president of Brazil’s central bank has identified the large interest rate spread applied by banks on top of the base rate as an obstacle to economic growth. His plan to increase competition and reduce this ‘spread bancario’ is long overdue.
Latin America: Banco do Brasil begins to convince
As CEO Caffarelli targets private-sector levels of profitability, Brazil’s state-banking behemoth is aiming to improve capital and benefit from a better economy.
Latin America: Santander Brasil focuses on its goals, not the misses
Santander Brasil lost out to rivals Itaú and Bradesco as other foreign banks put their businesses on the block. It might not be a bad thing. The bank is the momentum story in a tough market. But just how far can it grow?
Brazil’s political risk is very much alive
The political class is tainted with corruption. What a time to introduce some big reforms.
The OECD’s arguments in favour of a higher credit rating are endorsed by experts taking part in Euromoney’s country risk survey.
Asia: Alder says Stock Connect has improved balance with Chinese regulators
Enforcement on the mainland remains a huge issue for the Hong Kong SFC, but its CEO claims things are changing.
The US always looked a tough nut to crack for CLSA and it’s only getting tougher, so it’s not a shock to see the Hong Kong brokerage heading for the exit.
It started out as one of 3,000 peer-to-peer lenders in China. In six years, it has become a broad wealth management platform that may raise as much as $5 billion in an international IPO this year. The pace of its growth has been every bit as breathtaking as Tencent’s WeChat or Alibaba’s Alipay, yet few outside China have heard of it. They will. CEO Gregory Gibb tells us why.
It seems perverse to criticize a high-yield boom just eight weeks after it got started, but questions are arising over the fervour for new deals.
Latin America: Brazil’s central bank attacks ‘spread bancario’
High cost of credit in the ‘free market’ segments seen as economic impediment; president of BCB committed to lower costs and greater competition.
Latin America: How BTG came through the ultimate stress test
When Brazilian federal police knocked on the door of André Esteves’ Rio de Janeiro home on the morning of November 25, 2015, they were not only arresting one of the country’s most prominent bankers, they were also delivering a hammer blow to his bank, BTG Pactual. There followed a stress test that would threaten the collapse of the bank. Here’s the story of how the partners forged a business model for BTG in the glare of public scrutiny.
Latin America – BTG Pactual: Esteves’ arrest shows how to run a bank
How many firms would survive the detention of the founder, dominant partner and largest shareholder? There is a lesson for others in that.
Private banking: Brazil’s locals consolidate and fight for offshore
The hoped-for flows onshore from last year’s amnesty on offshore wealth have failed to materialise, so far. Meanwhile, Citi and HSBC have sold up. So where did a 15% increase in assets under management come from?
New China bond licences raise more questions
The two licences awarded to JPMorgan and Citi in the Chinese bond markets this week look like progress, but need closer examination.
2017 Chinese economy & investment environment outlook e-book
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Emerging Europe: Western banks return to Russian IPOs
International investors regain appetite for Russian stocks; Sovcomflot privatization on the table again.
Emerging Europe – Russia: Unsecured, untied and not a bond in sight
International banks recently put up an unsecured loan for a Russian borrower with a parent on the US sanctions list. Has the loan market for unsanctioned investment-grade Russian borrowers just got broader, deeper and potentially cheaper?
Asia banking: Are China’s JVs worth the effort?
The long-awaited tie-up between HSBC and Shenzhen Qianhai Financial Holdings still seems to be nowhere in sight.
Portugal’s doubtful Chinese bailout
Chinese firms are back in the running for control of Portuguese banking. The two sides are more used to doing business now – and the sellers are even more desperate for capital.
Chinese Hong Kong listings survive capital curfews
Although China has restricted capital flight, it is still encouraging Hong Kong IPOs. That is good for international banks – mostly.
Asia bond markets make strong early running
In sharp contrast to this time last year, Asian issuers have rushed to get deals away while benign conditions last. How long will the Asia DCM boom last?
China: AIIB’s clouded outlook
Beijing's pollution a problem for staff moves.
Brazil extends successful offshore wealth amnesty
Amnesty has been a big fiscal bonus for government in 2016; large inflows have been counterintuitively a net-negative for local AUM.
Brazil begins micro reforms in attempt to end recession
Regulatory reforms negative for non-bank financials; banks’ NPLs could get a boost through reform of FGTS.
BTG aims downmarket as technology reshapes Brazilian banking
BTG Pactual launches online-only investment platform; Banco do Brasil shedding jobs as it pushes digital.
Modi’s demonetization catches India on the hop
Scrapping large-tender notes sparks panic; ‘black economy’ crackdown prompts cash squeeze.
Year in data 2016: China’s dominance of investment banking reaches troubling levels
It is no secret that China is the biggest game in town in Asia-Pacific investment banking. But it is striking, even alarming, to learn just how utterly dominant it has become.
Asia: Shenzhen-HK Connect arrives as insurers are pilloried for investment
New capital flow channel had a limp debut; insurance industry is under the cosh.
Investigations leave Hong Kong’s bankers nervous
SFC scrutinizes stock exchange sponsors; US pursues princeling hires.
Asia: Allure of the Chinese buyer begins to fade
Outbound M&A from China has been one of the big themes in global investment banking over the past few years, much of it driven by the need to reform China’s state-owned enterprises. But it is tricky work, subject to forces beyond an adviser’s control, and only some of it is lucrative. No wonder bankers, and many selling companies, are re-evaluating whether a Chinese buyer is unequivocally a good thing.
Latin America: The sucking sound of Brazilian interest rates
Brazil’s economy leads the world in high interest rates. It is a blessing for banks but a burden on the economy – draining resources away from both new investment and consumption. Will new credit platforms finally jolt the established banks into a competitive response where previous strategies have failed?
Banco do Brasil strives to turn a corner
New management aims to rebuild core equity; attractive valuation if it avoids equity issuance.
Latin America: Investment bankers optimistic for upturn
Revenues still depressed by poor ECM; DCM and M&A resilient but at low levels.
Russia investment banking: VTB Capital faces down the doubters
Russia’s leading investment bank has seen its fortunes fluctuate over the past two years. Alexei Yakovitsky, VTB Capital’s chief executive, talks to Euromoney about Brexit, Africa and state ownership and explains why sanctions have proved more of a blessing than a curse.
China and India: A tale of two New York IPOs
ZTO Express underlines US affection for ambitious Chinese firms; Azure Power shows how much farther India’s have to go.
Subramanian’s brief moment of online passion
Pity Arvind Subramanian – he has a tough enough job as it is as chief economic adviser to the government of India without further distraction.
China’s swap shop tries to avoid swamping banks
New debt-equity swap measures tackle corporate debt load; bank NPLs are already rising.
Brazil: BMG’s short-sighted asset sale to Itaú
Sale of JV stake will boost capital ratios but adds strategic uncertainty, while the acquisition further strengthens Brazil’s largest private bank.
Brazil: Itaú acquisition raises competition concerns
Citi exit increases concentration; lack of competition ‘causing economic damage’.
Brazil: BM&F Bovespa’s room for recovery in question
Exchange already ‘toppish’, valuations suggest; Bovespa argues internationalisation adds differentiation.
Central Bank of Brazil fluffs its lines
Brazil’s central bank chief has missed a great opportunity to address its uncompetitive banking sector.
Russia: Teplukhin reunites Troika team for new boutique
Matrix Capital to offer fund management, advisory; ‘perfect fit’ for global banks in era of Russia pullback.
India’s resurgent IPO market banks on insurance
ICICI Prudential Life reinvigorates IPOs; slew of smaller listings ready to follow.
Asia banking: China’s shadow monster can’t be stopped
Sector is opaque, distorting and unstable; banks ‘lending where they shouldn’t be’.
China: Postal Savings spreads the love 26 ways
Bank sets record for bookrunners on a single deal; raises $7.4 billion but only thanks to cornerstones.
The dominance of cornerstone tranches in Chinese IPOs represents a raw deal for other investors – and needs to stop.
ECR survey results Q3 2016: China, Italy, Nigeria mar stabilizing global outlook
The calming of the political shock of Brexit, with oil prices now receiving Opec support, is preventing global risks from worsening, yet with a referendum looming in Italy, elections in the US and Europe to come, not to mention frail banks and several countries mired in difficulties, it might be the calm before another global storm.
Asia real estate: Divorce? It’s the best deal in China
Decoding the Chinese property market has always been a challenging science, but even the savviest analysts may not have appreciated one unlikely driver: divorce rates.
Latin America: Brazilian brokers wave the offside flag
Latin America fintech: Brazil’s digital puzzle
New regulation in the pipeline to cover fintech companies; large banks wary of cannibalisation of revenues.
Financial inclusion: Biometric banking and the $600 billion opportunity
An extraordinary revolution is taking place in digital banking in India. Driven by the state, it is anchored on a billion-strong biometric database to finally bring financial inclusion to a country that needs it more than any other. Banks may face a binary outcome: be quick or be dead.
Understanding India’s push into biometrics
From Aadhaar to iSPIRT – your guide to Indian biometrics.
How financial inclusion will change the face of banking
Technology is finally bringing banking services to the unbanked in both developing and developed markets. While technology companies are driving this transformational shift, it looks increasingly likely that traditional banks will ultimately be service providers. They have everything to gain if they can form partnerships and create a long-term strategy.
Asia: Bhattacharya stakes her reputation on transforming State Bank of India
Arundhati Bhattacharya already had one of the toughest jobs in India as chairman of State Bank of India. Not only is it the country’s largest financial institution, but it is also woven inextricably into India’s social fabric. She has made her job harder still by proposing a seven-sided bank merger. But as technological innovation increases and as asset quality plunges across public banks, bigger may not necessarily be better.
Asia: State Bank of India – communicating to the masses and turning to tech
Arundhati Bhattacharya is an SBI veteran: she joined in 1977.
China private banking debate: Wealth managers look to a world of opportunity
China’s leading lenders are opening private banking offices across the world to cater to their wealthiest clients. But all global wealth managers face the same challenges: rising regulations; the need to maximize internal resources by targeting the right markets and clients; and the rise of technology.
China rings changes in homegrown bond markets
New deals show innovation; mounting concern about defaults.
China looks forward to second phase of CIPS
As the China International Payment System (CIPS) approaches its first anniversary, there is much anticipation around how the second phase of the project will impact RMB settlement volumes.
Bulge bracket gets slimmer in Asian investment banking revenues
Euromoney’s sister company Dealogic released a set of data on Monday confirming what many international bankers in Asia have feared for some time: that they are becoming less relevant and are losing their lunch to local, chiefly Chinese, rivals.
Brazil improving, but Olympian feat required to reclaim investment grade
Latin America: Lacerda plays a grown-up game
The downturn in Brazil does not faze Ricardo Lacerda, founding partner of local investment bank BR Partners. Advisory remains the bedrock of his business, but political instability makes him think the next five years could undermine the last 20.
Brazilian banks’ share rally to falter?
Best global performers so far this year; Rally technical; fundamentals remain poor.
Russia: Is Alrosa a diamond deal or fake sparkler?
US investors shun Russian privatization; global banks not required, say locals.
Yes Bank, started just 12 years ago, is one of India’s fastest growing lenders – and the most interesting by far. Its founder and CEO sits down with Euromoney to discuss risk management, cost cutting, divine intervention and why he doesn’t do the ‘wow’ factor.
Reserve Bank of India: Why did Rajan go?
All eyes are on the expected appointment of a new Reserve Bank of India governor, but nobody is quite clear why there needs to be a new one.
Masala debut at last
HDFC launches first corporate masala bond; others may be slow to follow.
China Construction Bank is not alone among the country’s big four banks to claim it changed its lending policy before the rise in bad debts. But in chairman Wang Hongzhang, CCB has a leader who thinks differently.
Temasek hit by China volatility
Posts 9.02% loss for 2015-16; sovereign fund reshapes portfolio.
China retail gold survey 2016: China steps towards gold dominance
As the Shanghai Gold Exchange introduces a new benchmark, the country now leads in gold production, consumption and imports.
China Retail Gold Survey 2016: Results Index
Brazil: What’s the Portuguese for backbone?
M&A: China’s new language of acquisition
China’s Big Four ready for bad debt challenge
Bank chairmen confident they can tackle NPL problem; Chinese economy undergoing necessary restructuring.
Latin America: As Brazil falls, private equity rises
Brazil: Corporate default fear drives impeachment
Markets rally on Rousseff’s woes; corporations pressure politicians.
Country risk: India takes a rain check, but it’s no monsoon
Asia: Good news for a multilateral future
Brazilian issuers eye securitization funding
Cheapest access to dollars: politics helps mask economic realities.
Brazil: Disposals help BTG Pactual pass liquidity test
Shores up confidence; retains minority Swiss bank stake.
Asia: China's moment of truth
China: Corporates face toxic threat of debt
Corporate debt at record high; NPLs at state lenders also on rise.
Euromoney Country Risk survey results Q1 2016: Heightened concern over Brazil, China and other EMs accentuates global shock prospects
Panda breath: China fears dislocation, not doomsday
Polemicists arguing either side of this coin toss abound, from water coolers to Republican primaries. Where once markets drew direction from the pronouncements of Alan Greenspan, they now rise and fall on Chinese numbers. Ironically, no one actually believes the official numbers that China puts out.
VTB and Russian Post go large on retail
Country risk: The compelling case for a China downgrade
Every now and then a barometer deal comes around: one whose outcome shows the market what to expect. One such was Goodbaby China Holdings, set to be a deal that showed there was still scope to launch IPOs, even mainland Chinese IPOs, in Hong Kong, despite volatility.
Brazil loses monetary lever
Private banking: Ways to win with India’s wealthy
The January fall in emerging market currencies, the exodus of foreign capital and a global bear market in equities all point to a new financial crisis. How China reacts to this threat holds the key for emerging markets.
Panda breath – Street food for thought
With the energy of frustrated followers of Nostradamus finally finding vindication, market-watchers pounced on China’s opening-bell volatility as confirmation that the end, finally, was nigh.
Euromoney Country Risk survey results 2015: China, Brazil and South Africa lead EM credit rout
Fear and loathing in Beijing rattles Chinese brokers
Arrests, disappearances and suicides rock industry; investor unease at hard-nosed Beijing.
Brazil: BNDES – extrication impossible
With a struggling economy, Brazil will continue to rely heavily on its state development bank to provide long-term finance for crucial infrastructure projects, unless private-sector alternatives can be found.
Russia payments bid unlikely to be swift
Indian IPOs: back in vogue, for now
ECM re-emerges from lengthy slump; foreign investors jump on slew of mid-sized IPOs.
China: Ex-regulator calls for market reforms
Gao urges SOE defaults; financial reform should precede capital liberalization.
Economists sombre on China monetary trap
Dollar dominance continues; RMB inclusion in IMF reserve basket symbolic.
AIIB spells out conservative approach
New Asia lender caps lending at $100 billion; dollars, not RMB, will fund projects.
China domestic reform: do or die
China is pushing ahead with capital account reforms but it needs to make sure its own house is in order first.
Country risk: Hungary, India and Thailand among EMs resilient to shocks
"Income shocks have been the name of the game for emerging Asia in 2016. Not everybody has suffered. India is the big winner."
China's international payment system gathers steam
One month in and it’s a case of so far so good for the China International Payment System (CIPS), even allowing for limitations in operating hours.
South Africa on critical list as Brics keep falling
The borrower’s fundamentals are pointing to a downgrade that would chalk up a trio of Brics on junk status based on S&P’s metrics.
Brazil seeks foreign help for infrastructure
Guarantees to aid private sector flows; BNDES scaling back but still dominant player.
Emerging markets are working for a multipolar monetary world. Beijing is spearheading the push to establish rivals to the World Bank to globalize the renminbi, establish markets for its excess capacity and plug the infrastructure deficit. But, for now, a post-Bretton Woods era is fantasy.
New Brics lenders redraw multilateral map
Top emerging market officials reveal the ambitions of the new Sino-led development institutions. But emerging markets ignore the opportunity costs of state-led project financing at their peril.
Brazil central bank: We thought 'good times would last forever'
Commodity exports overvalued the real; manufacturing went 'down the drain'.
Country risk survey results Q3 2015 dominated by China’s jitters, Brazilian crisis and EM capital shock
With Brazil in freefall and a US interest-rate hike on the cards, investor risk is rising for many – but not all – emerging markets (EMs), complicating portfolio selection.
Brazil: Downgrade sparks fears of sell-off spiral
IRB Brasil Re delays IPO pricing; debt markets down 52% on year.
Latin America investment banking: Fees’ big freeze
Investment banking fees in LatAm are on the way down and international banks face a tricky choice of whether to stick or twist.
Emerging Europe: Tinkoff defies Russian consumer squeeze
Bad debts spark second wave of sector losses; CEO says low-cost, credit card model key to success.
Elvira Nabiullina, Euromoney’s central bank governor of the year, is staunchly sticking to her controversial crisis-fighting plan as Russia reels from its biggest financial crisis since 1998. As sanctions and falling commodity prices threaten Putin’s oil-financed state patronage, the central bank – the last bastion of economic orthodoxy – is battling to craft a new growth model. Can Nabiullina turn crisis into opportunity?
Nabiullina rages against the banking machine
In 2013, Russia’s central bank became a mega-regulator, overseeing a slew of credit institutions, from banks, insurance agencies, investment vehicles, micro-finance houses to pawnshops. That makes Elvira Nabiullina the most powerful central banker in modern Russian history.
China ponders privatization conundrum
Beijing plan to privatise slew of SOEs: Analysts fear concentration of power.
Brazil private banking debate: Private bankers cushion the blows in Brazil
The country’s economy is going through tough times, putting a greater onus on private bankers to look after their clients’ investments. An emphasis on overseas diversification of portfolios is crucial. However, domestic investments still take up the greater share and require careful management.
Infrastructure finance: Projecting Brazil’s future
The Brazilian government is pinning its hopes on infrastructure finance to boost GDP growth and help woeful productivity rates. But the source of finance and the viability of some of the proposed projects mean that an infrastructure-led recovery won’t be coming to Brazil’s rescue any time soon.
Brazil banking: Bradesco buoyant, HSBC on back foot
Brazil deal lifts Bradesco; UK bank fights to retain Mexico.
Latin America: Average deal fees slump
The region saw 40% less issuance than in the same period last year – with the slump in Brazilian issuance to blame for lower revenues.
Russia: Moscow IPOs come under fire
More secondary listings likely; consumer, tech, export stocks in focus.
IPOs: We need to talk about Russia
Two successful IPOs should have been good news for the country’s markets – if anyone had bothered to tell the world more about them.
Over one quarter of fund invested in China; concern over volatility exposure.
China: Stock meltdown prompts market intervention
Foreign investors pull Rmb40.5 billion in two weeks; average P/E ratio still 66 times.
Brazil: Project bond push called into question
Government seeks private investors; buyers 'not fully aware’ of the risks.
Don’t bet on Brazil’s equity markets waking soon
Brazil’s economy must absorb a lot more pain before it starts to grow again. Until then, investors will stay away, and the deals won’t come.
Latin America: Mexico leads but Brazil stirs from ECM slumber
Demand rising, busy second half expected; Par Corretora holds key to Brazil return.
China high yield: Whimper greets property developer Kaisa’s default
Stark contrast with reaction to Sino-Forest default in 2011; case highlights key man and regulatory risks in China.
Chinese corporates question value of advice
The culture among Chinese companies of preparing and executing their own acquisitions isn’t good news for investment banks keen to charge for services. Will it ever change?
Chinese buyers descend on Lisbon
It may be a battered economy on the edge of Europe, but Portugal is rapidly becoming the hotspot for Chinese corporate ownership in Europe, particularly in the financial sector. Whether they like it or not, governments and regulators in Lisbon, Brussels and elsewhere will welcome them with open arms.
Latin America banking: Risk pendulum swings back to locals
"I think we will see the Spanish banks remain a strong foothold in the countries that they are already present and also see other foreign banks keeping strong footprints in markets like Mexico and Brazil."
Peru a safer prospect than Brazil, with Mexico and Colombia in its sights
The Andean nation was riskier than Brazil not so long ago, but has risen through the LatAm rankings and might soon become the second-safest credit in the region behind Chile.
Brazil: Cielo and Petrobras give grounds for optimism
'Deal surge’ predicted; Goldman Sachs urges caution.
Is Bradesco in the frame for HSBC Brazil?
Global firms feel pinch; Chinese banks set to enter?
Emerging Europe: CIS counts the cost of Russia
The rouble’s crash sent currencies tumbling across the Caucasus and Central Asia. Banks look relatively well placed to withstand an inevitable downturn. But with protracted stagnation looming, is it time for policymakers to build bridges further afield?
Raiffeisen: Sevelda's struggle
In Russia, Raiffeisen is set to close operations in six far eastern regions and 15 smaller cities across the country, as well as pull back from the auto loan market. Sevelda says the bank will also take steps to improve the quality of its loan portfolio in Russia.
China banks face real-estate dangers
The slowdown of the Chinese real-estate market is an increasing risk for the country’s banks, but government intervention might dampen the threat.
Dim sum bond issuance slumps as renminbi globalization struggles to gain traction
Recent data suggest that the momentum of the renminbi is slowing, particularly outside Asia.
China: Muni sea-change excites overseas investors
Beijing has ambitious plans for market; international funds will find it 'hard to ignore’.
Euromoney Country Risk Survey Q1 2015: Russia crisis, China fragility and EMs’ capital-flow shock
Russia’s mounting problems caused by the sanctions and low oil prices undermining the rouble extended its trend decline into Q1 2015.
Spotting the bottom in the Brazilian real
Falling real creates value; upturn predicted for 2016.
Digital banking: Electronic shock for China's old guard
Tencent and Alibaba are at the vanguard of setting up new online banks. It's a great way to shake up the old state players and, by mining their data, get credit ratings for China's underserved population. But do upstart tech companies really have the political and business resources to challenge the incumbents?
Stock Connect: China shorting plan 'needs more lenders'
The pool of approved stock lenders for the Shanghai-Hong Kong Stock Connect short selling scheme must be widened for the initiative to succeed, according to market experts.
Debt restructuring with Chinese characteristics
Critics may cry foul at the moral hazard but Beijing has bought itself time with its debt swap for local governments.
Latin America: The great rotation in M&A
"If we are in Brazil, it’s for the long run. We decided a long time ago that Brazil is not an easy country, but it’s a growing country. […] You have to look beyond the circumstances that you see now."
Brazil's education still smart despite regulatory blow
Tarpon takes control of Abril for R$1.3 billion; new regulation might limit numbers of higher students.
Brazil: Petrobras will be shut out of bond markets until 2016
Needs credibility before returning; wants to avoid punitive pricing.
Brazil's local capital markets: Blame it on Brasilia
Brazil has all the ingredients for successful local markets, but it keeps failing to deliver.
LatAm bond markets: Brazil’s local markets brace to take the strain
The troubles at Petrobras have hurt all of Brazil’s borrowers but bankers in the country think the worst is now over and that the bad news has been priced in. The proof will come when issuers return to the markets, but who wants to go first – and can the local markets produce the goods?
Emerging Europe: Belarus embarks on a charm offensive
Belarus’s leaders are promising a dramatic package of reforms that could overhaul the country’s sclerotic command economy and reduce its dependence on Russia. The only trouble is, no one believes them. Mixed messages to the bond markets haven’t helped.
Indian ECM volumes set to rise, while fees stay low
A number of eye-catching deals in the Indian market in 2015 are creating excitement for bankers about the potential pipeline of deals this year.
Asia: Patience pays off as Citic/CLSA makes its mark
Few thought that the marriage of a Chinese securities firm with an Asian brokerage which had a unique, and at times disruptive, culture could work. But two years on, Citic and CLSA have proved they can be at least the sum of their parts. Can the combination now become a true regional powerhouse as its leaders hope?
Private banking in Latin America: Brazil reverts to type
The private banking industry in Latin America had a difficult 12 months as wealth creation slowed throughout the region. The picture for the year ahead looks brighter for some countries, but Brazil remains the dominant market and its prospects are still murky.
DCM: Mexico fills Brazil void in international markets
Sovereign reopens market; Petrobras saga stymies Brazil.
Heron serves up irresistible dish to Bradesco
Brazilian bank Bradesco opens its London office on February 9.
Russia: Buyers shun deeply discounted rouble
Russia has been caught in the eye of a perfect storm. Battered by falling oil prices, US and EU sanctions and a dramatic market correction as the rouble was allowed to float, the currency has been in free-fall and liquidity has largely evaporated, with many brokers ceasing rouble trading altogether.
Asia: Anti-graft drive puts Macau in the shade
Gaming capital stocks fall 41%; gambling revenues down 30%.
Chinese brokers hungry for assets outside Asia
Haitong adds to trend with BESI deal; further opportunistic moves on way.
Online banking comes to China
Pioneering WeBank launches; China set to lead industry.
Trade finance: RMB expansion catches up with China GDP
Capital controls have constrained the use of the renminbi in global trade, while China’s real economy has surged ahead. Despite the strict rules around its use, market players are punting on strong RMB growth in 2015, Euromoney’s Trade Finance survey reveals.
The year of energy-induced recession in Brazil?
Rationing increasingly possible; Stagnant economy slowed consumption.
Petrobras shuts Brazil out of international markets
Corruption scandal stymies bond issues; lack of supply might set stage for others.
2014: a year in data – Brics
Brics hit the economic wall.
Euromoney Country Risk survey results 2014: Negative oil shock creates new threats
Negative oil shock compounds Russia crisis.
Russia risks derailing banks’ regional plans
As Europe has stagnated since the financial crisis, Russia proved an invaluable source of returns for a handful of lucky western banking groups. But with Putin on the offensive, the rouble on the slide and recession on the horizon, its days as an engine of regional growth look to be over.
Russia: The mother of all macro risks
The growing likelihood of an economic crisis in Russia will have a major impact on global markets in 2015.
2014: a year in data – Russia
Rouble brews trouble for Russia
Brazil’s reality check for reviving the economy
Brazil has a long and painful struggle ahead to revive its economy. Denial and complacency will not help that process.
Brazil: Bankers rueful over Rousseff
Brazil’s banking industry exclaimed loudly that another four years of Dilma Rousseff would be a disaster for the country. Now that she has been re-elected, have the bankers changed their minds?
Brazil’s banks immune to struggling economy
Strong results across the sector; banking system 'a source of strength’.
LatAm: Rising rates will limit IPO activity
Rising rates deter equity investors; Brazil no longer driving volumes.
Euromoney’s risk survey pinpoints mispriced oil-exporter credits
Russia’s and Venezuela’s plight was predicted by Euromoney’s country risk survey well before the market priced in their deteriorating creditworthiness. Other, similarly ranked oil-producing sovereigns could endure a similar fate.
Moscow Exchange: All revved up with no place to go
Moscow’s revamped stock exchange has everything it takes to be a global player, with the exception of supply and demand. Has Russia’s isolation put a dampener on its ambitious domestic capital markets development programme?
China sprouts green shoots in securitization
A flurry of new deals points to an exciting new business possibility for Apac banks in 2015.
Russian bank risks jump as Europe's halves
The latest results of a systemic risk index reveal elevated risks in Russia, Portugal and France but a generally marked improvement across the rest of Europe.
Russia’s risk score plummets to its lowest since 1998 default
As sanctions and falling oil prices force the rouble’s slide, country risk experts are questioning the ability of privately owned and/or state-backed banks and corporates to obtain credit and repay their debts amid capital flight and an economy in decline.
Hong Kong-Shanghai Stock Connect enables CNH funding arbitrage
The Hong Kong-Shanghai Stock Connect, which was launched amid much fanfare on November 17, has triggered a jump in CNH-funded arbitrage opportunities. However, rising Stock Connect volumes and easing by the People’s Bank of China – triggering a convergence between onshore and offshore rates – will remove current funding advantages.
China: Stock Connect through train steams ahead
The eagerly awaited Stock Connect system connecting Hong Kong to the mainland is up and running to relief all round. While traditional long-only funds and southbound flows have lagged, market players foresee a new dawn in Chinese equity trading.
The new normal for EMs
China, the dollar and oil. All three are moving in novel directions.
ECR: Which way next for Brazil?
Experts taking part in Euromoney’s country-risk survey have cast doubt on Brazil as an investment destination in recent years.
Russia central bank attempts rouble crisis circuit-breaker
Analysts support the Central Bank of Russia’s (CBR) response to the collapse of the rouble – abandoning the dollar band and providing new channels to funnel liquidity to the market – arguing it will shift market expectations and could stabilize the currency in the medium-term. In an interview with Euromoney before the move, a CBR official discusses the opportunities and challenges in the regime shift.
Dark clouds still loom over India IPOs
The feelgood factor from the election of Narendra Modi as prime minister does not seem to be translating into better fees for IPO bankers – yet.
Brazilian real troubles far from over
The decline of the Brazilian real to a nine-year low this week seemed to mark a nadir for a currency buffeted by economic and political concerns. Analysts say, though, that things could get worse before they get better.
Brazil and Mexico follow divergent long-term risk trends
Investors should take note: LatAm’s big two have been offering contrasting portfolio options for some time. This year is no exception.
Brazil faces tough future, say economists
Vital reforms unlikely; next president will inherit inflation headache.
Russia borrowers strike bullish note over sanctions
While sanctions are hitting the Russian markets and pushing up interest rates, senior executives at Sberbank and potash producer Uralkali tell Euromoney the country’s banks and corporates are looking internally and to the east for new sources of financing. But with Russia sliding towards recession, liquidity is vanishing.
Abigail with attitude: Blackstone’s disengagement from Russia
I was intrigued to see that Blackstone, the leading private equity firm, is disengaging from Russia.
Russia: Banks will shrug off sanctions
Sector profitability holding up; central bank adds dollars to liquidity provision.
The real emerging Europe
CEE enthusiasts should not despair just yet. A number of the clouds handing over the region might turn out, on closer inspection, to have a silver lining.
Rajan’s surgical strikes
Reserve Bank of India governor Raghuram Rajan is battling inflation and crony capitalists to open a new chapter in the Asian superpower’s growth story. Rajan – Euromoney’s central bank governor of the year 2014 – reveals his blueprint for reforms and issues a stark warning about the cracks in the global economy.
Central bank governor of the year 2014: Rajan emerges unscathed from Indian baptism of fire
Reserve Bank of India governor Raghuram Rajan’s tough monetary medicine combatted the storm ravaging the deficit-ridden economy in the recent emerging market crisis. Now, he is battling vested interests to arouse a sleepy financial system for over one billion people.
RBI’s Rajan sounds alarm over breakdown in global coordination
A lack of international monetary policy coordination and efforts to beef up the IMF to reflect the newfound clout of emerging markets (EMs) raises the risks of trade protectionism and market volatility, Reserve Bank of India (RBI) governor Raghuram Rajan tells Euromoney.
Looming China crisis adds to eurozone and emerging-market threats - ECR Q3
The latest results from the Euromoney Country Risk survey point to an unprecedented rise in risk across almost all geographical regions since June, with emerging markets (EMs) taking the biggest hit as doubts over China, the eurozone and US liquidity support weigh heavily on experts’ evaluations.
China trade finance: What lies beneath
The surge in China-related trade financing might not be as encouraging as the pure numbers indicate.
South Korea battling for RMB spoils
Backed by its robust trading relationship with China, the east Asian nation is the latest fledgling offshore renminbi hub. Market participants shed light on South Korea’s renminbi bid as internationalization of the Chinese currency gathers pace.
Asian bankers bathe in Alibaba afterglow
Alibaba lists on NYSE; deal might free up pipeline.
Brazil elections: Don’t bank on Marina
Brazil’s business community wants 'anyone but Dilma’ as its next president. But Marina Silva will not be able to deliver everything that business, or the country, needs.
Modi makeover ignites India’s banking leaders
In exclusive interviews, leaders of Indian finance reveal how banks, nursing wounds from the recent credit boom, should be set free from the shackles of state control, as reformists raise hopes of a new dawn for Indian capitalism. A jolt, not a tweak, to the financial system is desperately needed.
India: Waiting game continues for foreign investment banks
Even in a bullish scenario where a Rajan-Modi dream team unleashes reforms – from PSL to the bond market – in an economic super-cycle that sees public lenders recapitalized, foreign investment banks could still be chasing rainbows in India. It is an over-banked market, with dozens of fee-hungry institutions jockeying for business.
Unchain Indian finance
India needs a litany of reforms to unshackle its stalled capitalist project. Modi’s government should take inspiration from the paradox of Singapore’s activist state and strong private sector.
Brics bank: requiem for a dream
Incensed by their failure to reform, Brics policymakers have established a flawed rival to the World Bank and IMF. Rhetoric aside, the west dismisses emerging-market dissent over the broken financial architecture at its peril.
Brazil private banking debate: Brazil’s problems prompt safety-first approach
Private banking clients in Brazil face challenging times, bankers concede. The economy is under pressure and the country could yet suffer stagflation. Furthermore, an unpredictable presidential race leaves markets in limbo. However, bankers are confident their well-educated client base will not over-react, and instead maintain their long-term strategies.
Brazilian public banks: Short-term gain, long-term pain?
Dilma Rousseff has told Brazil’s public banks to boost the country’s flagging consumption until the elections with double-digit loan growth. Weakening credit quality and capital ratios are worrying analysts.
Ferraz defends BNDES role
It has become normal in Brazil for private-sector banks to express frustration with the scale and cost of BNDES’ presence in financing corporate Brazil. However, given the power of the bank to engage with private-sector financial institutions (either through granting debt lines that are passed through the private banks, or from holding equity stakes in companies that the banks see as clients or potential clients), these criticisms are made off-the-record.
Economic growth: Two-speed Latin America
Mexico’s energy reforms should kick-start growth in its lacklustre economy while Brazil appears to have no strategic planning in place.
Brazil: Energy options running dry
Election campaign delays rationing; 'pray for rain’ say analysts.
Brazil: Private banks predict end to short-term, tax-free investing
Asset allocation hangs on election result; closing the instrument is good news for private banks.
Markets pine for Brazil election game-changer
The Brazilian real has been rising in recent weeks on hopes opposition candidate Marina Silva will beat president Dilma Rousseff in a run-off election in October. With the Brazilian economy faltering and the election outcome still on a knife edge, the real’s outlook – and the country’s macro framework, more generally – remains unclear.
Sanctions propel Russia towards Asia
Sanctions overs the conflict in Ukraine have closed off western capital markets to some Russian companies, giving Asia an opportunity to take a greater role. But an easy ride in the east is not guaranteed.
Roman Avdeev: Moscow’s most unlikely billionaire
Philosopher, philanthropist and father of 23 – Roman Avdeev is a far cry from the stereotype of Russian oligarch. Yet his ownership of Credit Bank of Moscow, one of the country’s fastest-growing lenders, along with canny deal-making in sectors from retail to pharmaceuticals, is fast propelling him up the rich list. And his status as one of Russia’s most independent billionaires gives him a unique insight into the country’s current pariah status.
Russian finance: Moscow’s cash cows
Russia’s consumer lenders are the modern face of Russian finance, and could prove resilient to the current crisis.
UAE/India debate: Trade and investment corridor booms
China’s ratings misprice its risk; Hong Kong’s are spot on
Disaggregating China’s investor risk into its constituent parts points to less safety in its sovereign bonds than its credit ratings suggest. Hong Kong is a different proposition with experts choosing to ignore its political problems.
China banking: Cinda – on the ball or to the wall?
Asset management company Cinda is a stark example of the implausible nature of China’s financial system. It has transformed its business model from an NPL warehouse to what some call a giant shadow bank. With more AMCs in the pipeline, analysts are beginning to question if China understands the risks it is piling up.
Hong Kong sukuk boosts Islamic credentials
The debut issue of a five-year $1 billion sukuk this week is a statement of intent from Hong Kong that it is serious about Islamic finance, sending a strong signal to rival financial centres.
Real estate survey 2014: Asia – China takes back seat in Asian real estate
The weakness of the Chinese market has prompted the Asian real estate industry to look elsewhere for returns in 2014.
Brazil: Local bonds rally on suppressed FX volatility
High relative rates draw investors; elections weigh on rally.
Brazil: Caixa makes a hybrid first
Deal sells at par; incentive to call after five years.
Asian private banking and lending eye Russia business
The escalating conflict in Ukraine and sanctions placed on Russia by the EU and the US are pushing private Russian money into Asian wealth centres and encouraging the country’s corporates to seek new sources of funding in the region.
How RenCap reflects Russia’s rollercoaster
The outrageous swings in fortune of Renaissance Capital over the past 20 years are the stuff of Hollywood legend. But what’s the next instalment for the Moscow-based investment bank? Out of Africa? Or just back to being The Russia House?
HKMA intervention once again prompts debate on US dollar peg
Bets of a re-peg of the Hong Kong dollar have resurfaced in the currency markets as the Hong Kong Monetary Authority (HKMA) intervened to inject dollar liquidity to the tune of $9.86 billion several times since July 1 on the back of large inflows into Hong Kong during the past few months.
China: IPOs in line for a ticket on the through train
New system connects Shanghai and HK markets; regulations need to catch up.
Brazil: Investors to 'return’ shares from Biosev’s IPO
Louis Dreyfus to repurchase 90% of deal; firm commitment IPOs under question.
Rollercoaster rouble freaks analysts
The Russian rouble is facing strong headwinds as the political fall-out over the fatal MH17 plane crash and fresh economic sanctions bite, with analysts predicting a tough year ahead for the Bric currency.
China banking risks three times higher than US
China’s banking risks have tripled in one year amid a decline in market capitalization for the sector and a rise in debt issuance, as fears over the shadow-banking system grow, according to the latest projections from a systemic risk index, Euromoney can reveal.
China: CIC censured for mismanagement
Authorities more strident on standards; wealth fund criticized for lack of due diligence.
Energy prices offer investment plays in Brazil
Short-term gains for some energy firms and industrials; longer-term energy strategy review needed.
Brazil's banks face new portability rules
Will make loan transfers less attractive for banks; technology a main driver of competition.
Brazil: Rousseff's water torture
A lack of rain to fill the dams that power Brazil is becoming a potential crisis. But as experts call for action to protect dwindling reservoirs the government refuses to act, and running the hydrology risk is becoming increasingly dangerous for it.
China helps bridge Russia's investment gap
Joint investment fund undertakes new deals; Kazakhstan's nationalized bank sell-offs set to go.
Ukraine FM slams 'not effective' western sanctions
The Washington-led sanctions on Russia, as well as officials and associates in the Putin circle, are toothless, Oleksandr Shlapak, Ukraine's post-revolution finance minister, tells Euromoney.
Is Asia Russia's saviour?
Hopes that Russian issuers can fund all their needs in Asia's markets are likely to be misplaced. But it will become a more important market for them, sanctions or not.
Is India bouncing back?
The world's biggest democracy saw its risk score improve in the lead up to the elections, which might be the start of an upward trend.
India's investment bankers: A la Modi
A new government could herald a more lucrative time for investment bankers in India.
China helps bridge Russia’s investment gap
Joint investment fund undertakes new deals; Kazakhstan’s nationalized bank sell-offs set to go.
Russian infrastructure investment under pressure
Fallout from the Ukraine crisis has not yet hurt the country's planned infrastructure development programme. But sanctions or not, Russia will be hard pushed to meet its long-term target in the domestic finance market alone.
Banks and corporates face severe challenge over Russia sanctions
Banks and their corporate clients are scrabbling to get up to speed and comply with a growing slate of US and European sanctions against Russia - or face unlimited fines and imprisonment.
Fed effect vs Modi effect: the rupee-appreciation story
After the rupee's spirited rally in line with the ascent of newly installed Indian prime minister Narendra Modi, analysts say rising US yields could undercut the currency, while others claim strong equity inflows and an improvement in the current account suggest appreciation for the rest of the year.
Markets rally on Brazil's downgrade
Markets responded positively to the downgrade of Brazil by Standard & Poor's. On March 25, the day after the announcement from the rating agency, the Ibovespa climbed and the real gained on the dollar.
Crimea and punishment: Russian economy goes into a tailspin
The battle between the west and Russia over Ukraine is intensifying amid a full-on financial war. Euromoney investigates the foreign-currency credit crunch for Russian borrowers.
Moscow's IFC dreams - another Crimean casualty
Russia's adventures in Ukraine are adversely affecting its international issuance. And at home they will stifle ambitions to develop an international financial centre.
Against the tide: Deep freeze - east and west
The crisis in Crimea should give the west pause for thought in its relations with eastern European states and with Russia.
Why the biggest victim of rising US yields could be China
How rising US short-term rates would complicate China’s credit challenge amid fears that a second, bank-led wave of outflows from emerging markets could be on the horizon.
Capital controls in China are broken; Beijing faces a new 'impossible trinity'
The sharp jump in cross-border lending to China in recent years means capital controls are de facto broken. As a result, Beijing faces the "impossible trinity" – an inability to manage exchange rates, monetary policy and allow for free movement of capital, all at the same time. China faces an renminbi-policy crisis just as much as a potential credit crisis.
Financial crisis fears in China overblown – private bank chiefs
Euromoney asked the CIOs and strategists of the leading private banks: are you adding or taking away China risk in your portfolios.
China’s banks shake off fear of foreign climes
Most have followed their clients’ businesses abroad. Now it’s time for them to learn the lesson of Alibaba’s listing in New York and become true international finance players.
Equities: Harbin underwhelms on HK debut
Deal priced at bottom of range; Alibaba finally chooses New York over HK.
Banking in China 2.0
Two banking upstarts are resetting the relationships the Chinese have with their boring old state lenders by being convenient and readily understood. Even better, they pay great rates. But the incumbents aren’t taking this new threat lying down.
Russia and the US face war of financial attrition in Crimea battle
Russia-US tensions over Ukraine could be the 'first major political conflict that is played out in international financial markets', according to Citi, as sanctions take their bite.
China, India and Russia worst offenders in trapping company cash
Treasury professionals of companies with combined annual sales of more than $250 billion have voted China, India and Russia as the worst countries to repatriate company funds from, according to Euromoney's 'trapped cash' pulse survey.
India worse than Iran for repelling foreign company investment: Trapped cash pulse survey
International companies are less likely to invest in India than Iran due to the seemingly more onerous regulatory and tax regime of the world's largest democracy, according to a pulse survey conducted by Euromoney.
Economic policy: Investors try to get a sense of Brazil in 2015
Post-election policies still hard to predict; fiscal discipline key to investments.
Latin America: Equity dislocation as a fixed-income driver
The fundamental dislocation of the region’s equity markets may actually drive DCM issuance in the coming year as a much-stalled pipeline of equity deals turns to M&A in frustration – and DCM deals will be printed to finance this predicted wave.
Ice grips LatAm's equity markets
The data is misleading, say analysts; the region’s markets are fundamentally fine. Institutional investors are sticking around, but local companies are finding that they need a convincing story to attract international money.
Latin American capital markets: Competition for HSBC as it builds in equities
Itaú strengthens position outside Brazil; equity lull a good time for hiring, says HSBC.
Investment risk: What the fragile five also share
Brazil, India, Indonesia, South Africa and Turkey have more in common than macroeconomic numbers.
Inside View: Ukraine/Russia fallout for private banking
Five CIOs discuss asset allocation changes in light of the tension in the border countries.
Ukraine tensions expose fault line in Russia’s economy
Russia’s muscular posture on the Crimean region of Ukraine, re-awakening Cold War tensions, threatens to tip the economy into a mild recession and has put a spotlight on the country’s structural weaknesses amid political risk, say analysts.
Banks to brave Russia-Ukraine storm, say analysts
While OTP and Raiffeisen are vulnerable to FX losses and a slowdown in Russia and Ukraine, the impact should be manageable, though there are some exceptions.
Rouble to remain steady despite recession risk and Ukraine crisis
Although current account deterioration, persistent capital outflows and the Ukraine crisis would seem to weaken rouble, the central bank’s flexible FX regime should keep the currency out of turmoil, say analysts.
China’s country-risk score still sliding
Experts lacking faith in the sovereign keep nudging its score downwards, suggesting the rating agencies are too confident in their risk assessment.
Decline of yuan-way bets triggers financial stability fears
The longstanding one-way bet on USDCNY has been in disarray, but worse might be to come, as China looks to its FX regime to cope with credit issues, and likely defaults this year, threatening volatility in the structured-product market.
ICBC lays new foundations
Chinese bank’s London purchase likely to be followed by other acquisitions in foreign markets.
Making sense of the fragile-five category of emerging-market laggards
Although market players discern substantial differences between the fragile-five economies – notably in their current-account profiles – they remain, as a group, especially vulnerable to domestic and international market shocks, says bearish analysts.
Ukraine’s depressing economic bind – and sovereign default risk
The scale of Ukraine’s challenge to correct economic balances is staggering, even if a political consensus is reached that would see an IMF support package. What’s more, markets might be understating sovereign default risk given strict debt covenants in the 2015 Russian-backed dollar bond that is sure to be used in a regional chess game, say analysts.
Highly commended CEE deal of the year 2013: Credit Bank of Moscow
There was no shortage of bond issuance from emerging Europe in the early part of 2013 before tapering fears set in. While deal sizes and volumes hit record levels, however, innovation was thin on the ground.
Private banking: China Merchants Bank woos second-generation wealthy
Wealth preservation a growing focus; succession issues come to the fore.
Private banking: China’s wealth set to overtake Japan's this year – HSBC
‘Plenty of work for wealth advisers’ in Asia, says HSBC in a report this week, citing how the region ex-Japan’s wealth will eclipse the US by the end of 2015.
Latin America offers pockets of resilience to EM risk aversion
ECR experts’ faith in Chile, Mexico, Peru and Uruguay is rewarded as stronger economies linked to fewer political problems survive the rout, but Brazil slides along with Argentina and Venezuela.
Private banking: The wealthy look abroad as Brazil’s brilliant future dims
In the past year the country’s private bank clients have been persuaded of the need to diversify into global investments – not as a panic measure in a time of crisis but as a regular aspect of their allocations.
Brazil: Private banking feels the Batista effect
With OGX’s debt issued internationally, there was reportedly little impact from the company’s bond default and October 2013 collapse into bankruptcy on the fixed-income portfolios of Brazil’s private banking clients – fixed income being the largest asset allocation among the vast majority of Brazil’s rich.
LatAm DCM: Frequent issuers eye euro arbitrage
Petrobras deal shows swap advantage over dollars; room for more quality issuers but a limited window.
CEE private equity: Back to basics
Central and eastern Europe is attractive for private equity houses. But they need to get their priorities right
Africa safe from China slowdown – for now
While China’s economic slowdown has had repercussions on global emerging markets, frontier markets – specifically China’s trade partners in Africa – have been relatively insulated from the storm, sheltered in part by their limited financial systems. And, perhaps surprisingly, analysts are sanguine about the outlook for commodity-intensive trade.
Physical ETFs to ease access to China A shares
New funds to track both A50 and CSI300 indices; Ucits compliance opens funds to European buyers.
Equity capital markets: China IPOs ride high despite regulator’s action
Mainland China leads exchange nationality ranking; Hong Kong IPOs start year to warm sentiment.
Brazil to reap bumper agribusiness harvest
The development of the cerrado into arable land will benefit Brazil far more than its oil discoveries.
Land rush on Brazil’s frontier
Transport costs have made the country’s agriculture industry uncompetitive. But new infrastructure projects should transform the opportunities some have seen in land values.
Capital flows: Brazil’s investors add outbound capital dynamic
Capital inflow down; Brazilian investor outflow up; increasing cooperation between Brazilian and foreign asset managers.
Brazil tries to shrug off a poor run in equities
Disappointing end-2013 performance; McKinsey analysis predicts long-term issuance growth.
Russian banking: Stalemate on investment banks’ eastern front
Russian and western firms have shovelled millions into investment banks in Russia. Although their ranks are much diminished, they remain dug in: doggedly hopeful, despite little chance of a change in their prospects.
Q&A with VTB CEO Andrey Kostin
In an in-depth interview with Euromoney, the head of the powerful Russian state lender discusses domestic bank competition, regulation, credit growth and reveals the impact of state ownership.
Andrey Kostin: The face of Russian capitalism
VTB’s chief executive likens his role in Russian banking to that of a surgeon in a state-owned clinic. He’s certainly carved out a strong position in corporate and investment banking. He insists he can operate successfully in Russia’s new state-controlled capitalism, while resisting political pressure. Can he make what critics call his ‘grandiose scheme’ for VTB work?
Emerging-market rout: this time it’s personal
Emerging-market assets have fallen thanks to domestic policy risks, rather than Fed-tapering fears, triggering market contagion, as Turkey and Argentina lurched into crisis mode. However, India’s economic rebalancing shows the way forward for EMs out-of-market favour.
Emerging market sell-off as a weak dollar/strong renminbi crisis
Is it all China’s fault? The Fed's? Febrile sentiment from the likes of Larry Fink? Argentina? Turkey? Or all of the above?
Emerging market plunge: Sino the times?
Not all emerging markets are in free fall, investors are discriminating between surplus and deficit countries, it’s not all China’s fault, and domestic EM policies matter.
Market is bullish on renminbi internationalization amid China wobbles
Concrete advances towards the full tradability of the Chinese currency are at last seemingly being made, helping to rebalance the country’s growth model but heaping on short-term risks to China’s economic and financial stability.
The stock market impact of China’s reforms
The country faces many problems in banking, real estate, consumption and demographics that cannot be quickly solved.
Asian M&A: China key to urge to merge
Asia Pacific’s moribund M&A market needs promised reforms in China to be effected as soon as possible.
Asian capital markets: Debt enjoys record year as equity rebounds
China drives capital markets; convertible bond issues stage a return.
China IPO market set to open in 2014 following regulatory clean-up
The mainland Chinese IPO market is set for a comeback this year as China’s Securities Regulatory Commission lifts a ban on new stock market listings as early as January and regulatory overhauls ease risk, analysts say.
Is Brazil as risky as CDS prices suggest?
Brazil is a riskier portfolio option than Mexico, according to live data from Euromoney’s Country Risk Survey, but the data suggest the risk differential is smaller than is currently priced into the credit default swap market.
Brazil’s cup is half full
There is too much bearish sentiment towards Brazil - investors shouldn't forget the long-term trends and the fundamental strengths of the economy.
Brazil builds its way to growth
BNDES to spend $250.8 billion 2013-16; also seeks to encourage private capital inputs.
Brazilian equities: The OGX effect
If Petrobras is considering an equity transaction in 2014, the implosion of Eike Batista’s OGX group this year won’t be helpful for investors’ perceptions of the risk of Brazil’s oil exploration and production industry.
Petrobras walks the debt/capital tightrope
When Brazil’s national oil and gas champion raised $70 billion from a capital increase in 2010, it was trumpeted as a once-in-a-decade event. But as Petrobras nears its self-imposed leverage thresholds, its capital position looks compromised. A sharp cut to its rating or a return to the equity markets looks likely. So why is Brazil’s banking community so scared to discuss it?
Russia’s next-generation investment banks muscle in
A new generation of firms are seeking market share from more established players in an already crowded investment-banking scene.
China-German economic ties set for rebalancing
Germany’s export machine will be hit by a rebalancing of China's economy, but the special relationship between the world’s second- and fourth-largest economies might provide a springboard for the development of more sustainable economic ties.
London-China ties strengthen as China Construction Bank touts UK business
With extended opportunities for UK investors in China through programmes such as the RQFII scheme, China Construction Bank opened its doors this week to London-based investors, signalling the strength of the Sino-UK relationship.
China private equity in transition
Strong industry growth over past decade; adverse effect of dearth of IPOs.
Cyclical China bears morph into structural bulls post-plenum
China’s once-in-a-generation economic reforms have largely pleased some notable bears, as new policies reflect Beijing’s recognition that a growth-at-all-costs investment-led model is bust, while capital-account opening could help navigate short-term credit challenges.
Latin America banking: Political risk slows China’s progress
But expected wave of bank consolidation not forthcoming; hampered in Argentina by high regulatory and political risk.
China consolidates its Latin American presence
Recent large-scale Chinese acquisitions and consortium agreements in the LatAm financial and energy sectors indicate the People’s Republic’s continuing interest in the region’s resources.
Rush to open free trade zone; aim to facilitate China’s entry into TPP.
China’s crucial Shanghai trade
At its Third Plenum, the Communist Party communicated its commitment to economic change. The country’s first free trade zone, in Shanghai, will act as the test bed, but without clarity on any number of policies, will international firms rush to set up shop?
China’s reform agenda
The absence of senior officials at the opening of China’s first FTZ doesn’t mean it’s not a priority.
Russia: Too many thrills, too few buyers
As growth slows, Russia needs to become less volatile as a market.
South Africa: Five reasons why it’s the worst of the Brics – for now
South Africa has, on the face of it, huge strengths: commodities, rule of law, strong institutions and consumption prospects, a social contract – aided by decent incomes per capita – and a sophisticated financial system, among other factors. But it’s failing in five key areas.
Arbitrage a risk in Shanghai free-trade zone
The free-trade zone in Shanghai has been depicted as one of the biggest steps towards Chinese economic liberalization, but some analysts argue the risk of arbitrage and a lack of transparency will be difficult to overcome – while there is no consensus on whether policymakers are committed to full-scale capital-market liberalization.
Junk status not on the cards for Brazil, say ECR experts
Speculation concerning possible junk status for Brazil might be wide of the mark, according to data from Euromoney Country Risk.
What investors want in Russia
Tinkoff has sold a clever story of another kind of Russian bank.
China ‘bad bank’ plan perplexes market amid secret debt workouts
The Chinese government says it wants to transform its asset management companies – established to take on growing bad debts in the banking system – into commercially driven enterprises. In reality, a lack of transparency on portfolio loans means analysts are none the wiser as to the scale of the problem and the resolution process for legacy loans.
UK Treasury China-bank charm offensive exposes regulatory arbitrage
The UK Treasury’s courtship of Chinese banks highlights, in part, London’s relatively flexible regulatory regime for foreign banks – in contrast to the Fed. It also opens up a broader debate about subsidiarization and global banking models, more generally, amid regulatory turf wars.
China’s latest swap agreement will facilitate trade
Swap agreement reflects growing trade; London has competitive advantage.
Equity capital markets: Li looks to IPO market as ParknShop sale fails
AS Watson under strategic review; IPO would be Asia’s biggest in three years.
Cash management in Brazil: Local knowledge bears fruit
Local banks like to see themselves as uniquely suited to offering cash management services to Brazilian companies. But the global banks are also getting up to speed on idiosyncratic client requirements and local regulation.
Brazil’s real: Playing into speculators’ hands
Brazil’s FX swap intervention is arming speculators for further attacks on the real.
Private equity: Cooling Brazil offers PE opportunities
Big increase in regional private equity activity; particularly attractive metrics in Brazil.
Debt capital markets: Taper or no, Federation shows Russia demand
Issuer ‘comes of age’; creates first euro benchmark.
Tinkoff IPO beats consumer credit fears
The IPO of Tinkoff Credit Systems, a Russian consumer finance bank, trounces rivals’ valuations, even as bad debts tick up and tighter regulations loom.
India still a crumbling Bric as China strengthens: ECR Q3 2013
India is waning due to its political uncertainties, lagging reforms, slow growth and currency weakness boosting debt.
Agricultural Bank of China economist warns economic reform hinges on politics
Xiang Songzuo, chief economist of state-owned ABC, says China’s next raft of reforms – from retooling state-owned enterprises to tackling local government debt burdens and environmental challenges – will involve a disruptive shift in the political system.
US Treasury renminbi undervaluation claim disputed
The US government has upped the ante in its criticism of China’s foreign exchange regime, but Lombard Street Research reckons the renminbi is, in fact, overvalued by 30% on a trade-weighted basis, citing, in part, rising unit labour costs and disinflationary pressures.
India still a crumbling Bric as China strengthens: ECR Q3 2013
Only China, now the safest of the five Brics, has a higher score compared with the beginning of this year.
Jury still out on China’s commitment to liberalization of financial system
The Shanghai free-trade zone (FTZ), China’s grand experiment with liberalizing interest rates and opening its capital account, has only a short window of opportunity to convince the markets that the Communist Party is serious about reform.
Cash management: A revolution in cash for China
Demand for sophisticated cash management services in China is rising as the authorities press for greater business efficiency at home and Chinese corporates expand their foreign operations. Renminbi liberalization is another driver.
Make or break time at China’s third plenum
High hopes for sweeping reform; Li says country is at crucial juncture.
Shanghai’s FTZ is not a threat
The new free-trade zone in Shanghai is much more likely to invigorate Hong Kong as a financial sector than threaten it.
New China import tax might take the heat out of coal
On September 3, Beijing announced a 3% tax on coal imports with low calorific value. Some market analysts are concerned that the tax might have a negative impact on Indonesian exports of thermal coal as the levy could remove any price advantages. Between January and July this year, Indonesia accounted for 97% of China’s lignite imports.
Commodities: Adaro fuels Asia’s hunger for power
As China’s appetite for commodities appears to be fading, demand for Indonesian coal could also fall, putting the export economy under stress. Mining company Adaro explains why the future is still bright.
International RMB: Luxembourg 1 Rest of Europe 0
London should be wary of the Duchy’s ambitions to become Europe’s RMB hub.
Emerging markets: New frontier hands Brics a blow
Maybe frontier markets can take the place such economies as Brazil, Russia, India and China held during the past two decades, as growth decelerates and investors tire of the Brics.
G20 wades in on emerging-market rout
Hopes are growing that concerted Brics policy action – with the creation of a $100 billion swap fund – and bargain-hunting will help engineer a rebound in sentiment towards EM currencies.
Brazil's economic growth: A test of credibility
Despite Roussef’s protestations, only structural reform will put Brazil back on a growth path.
CRT breaks ground for Brazil infrastructure
It was second time lucky for the first Brazilian toll-road financing to come to the market without the support of BNDES. The initial attempt ended in confusion. A year later, the revived deal under new leadership faced severe headwinds.
CRT: Building blocks of Brazil’s first project finance bond
CRT was a natural candidate to open the project finance bond market in Brazil because the sponsors of Rodovias do Tietê are Atlantia Bertin Concessões (a 50/50 joint venture of Atlantia and Bertin), and Ascendi (a 60/40 joint venture of Mota-Engil and Banco Espírito Santo). They have experience of these structures in Europe.
Brazil markets will instigate policy change – BlackRock
BlackRock’s Gerardo Rodriguez Regordosa says he believes that the markets are punishing Brazil for policy mistakes and that this is likely to lead to a shift in economic policy by the government of Latin America’s biggest economy.
Brazil: BNDES strategy confusion
The level of commitment of Brazilian development bank BNDES to support new capital market structures to finance infrastructure projects has been thrown into doubt by the bank’s recent strategy.
Capital-hungry borrowers seeking to plug the huge infrastructure deficit in Latin America’s largest economy through international capital markets are hoping Eike Batista’s OGX group will avoid default.
Devil is in the detail in EM currencies
Among EM currencies, Morgan Stanley’s strategists named the real, South Africa’s rand, India’s rupee, rupiah and lira the “fragile five”. Still, investors should beware tarring all five with the same brush, some analysts say.
Russian banks play truth or dare
During the past three years, Russian banks have plastered over holes in the corporate sector with record profits from retail. The choice now might be between fuelling a bubble or stagnation.
Metal prices bring Rusal more challenges
In mid-2013, Rusal had its lowest net debt level since 2008: less than $10 billion, Oleg Mukhamedshin, deputy CEO, tells Euromoney. He says the firm hopes to reduce debt further – from six times ebitda – via internal cashflow, dividends from Norilsk Nickel, assets disposals and new equity issuance.
India continues battle on rupee volatility
Raghuram Rajan, the new head of the Reserve Bank of India (RBI), has his work cut out to turn around the fortunes of India’s economy, with the rupee coming under renewed pressure, having staged a brief recovery immediately following his appointment.
India slowdown sparks debate over threat from shadow financing
Concerns are mounting about the risks to India’s financial health posed by a growing shadow banking sector that has helped fund a decade-long investment-fuelled consumption and investment boom.
China sows seeds for next global downturn
The emerging market sell-off since May is just the start of a painful multi-year adjustment process – and China has blazed a trail for the next downturn. Capital abundance, deflationary pressures and imbalanced global demand continue to drive the 15-year cycle of credit booms and busts.
Big-game hunting for China’s POEs
State-owned companies have, until now, set the tone in China. But as economic growth slows and state-driven capital market activity founders, banks are hunting for business from China’s privately owned, ambitious enterprises.
Bank shortcomings exposed as Chinese economy founders
The Chinese economy is growing ever more slowly – probably slipping even faster than officially admitted, and from a base whose size is possibly exaggerated too. In the midst of this, the orthodox banking sector is doing unorthodox things on a grand scale, while being undermined and bypassed by an even more unorthodox grey financial sector.
China: Government bond futures return after 18 years
Risk-control measures in place; further step in economic liberalization.
Bank hiring practices: US regulators turn spotlight on Hong Kong
Banks everywhere hire well-connected employees as standard practice. Why should Hong Kong so grate with US regulators?
Foreign investors wary of China onshore risks
The preferred method for playing Chinese credit markets remains the dim sum bond market, say analysts, as China’s expansion of access to its onshore market is met with a cool reception by foreign investors.
Jin-Yong Cai: An activist at the IFC
The new head of the International Finance Corporation, Jin-Yong Cai, tells Euromoney about the need for the World Bank’s private-sector arm to take more risks and be more activist in developing policy ideas in such areas as infrastructure development and poverty reduction.
Emerging market FX growth underperforms broader market
Emerging market (EM) currencies are expected to continue to expand their share of the $5.3 trillion-a-day global forex market despite the turmoil, with China’s RMB leading the charge.
Brazil risks becoming latest emerging-market victim of stagflation as economy falters
Brazil’s recovery is being cut off at the knees by a set of economic challenges that have all come home to roost – from a depreciating currency and rising current-account deficit to structural problems, including an overdependence on credit-fuelled consumption.
Brazil private banking debate: Brazil’s private banks adapt to a changing economy
Wealthy Brazilians’ traditional dependence on positive real interest rates for investment returns has been undermined. Euromoney’s roundtable of private bankers discusses how wealth managers are developing new investment opportunities for their clients and how those clients are responding.
Debt market for Brazilian oil and gas thaws, but outlook icy
Brazilian capital markets are showing signs of life again after a particularly torrid summer as industrial conglomerate Odebrecht priced a $1.7 billion nine-year bond. But investor wariness towards Latin America’s largest economy persists.
IPO guarantees threaten Brazil market, say bankers
Recent Brazilian IPOs have incorporated novel support structures in an attempt to generate demand, but some ECM bankers warn that the movement away from traditional bookbuilding might damage, rather than help, the troubled primary issuance market.
Brazil: Corporate slowdown puts focus on insolvency law
The slowdown in the growth of the Brazilian economy after the recent big expansion in corporate issuance into the international and domestic capital markets has put the focus on the efficacy of Brazil’s relatively recent (2005) insolvency law.
Latin America: Bankers caught in valuation divide
Brazil is the biggest culprit: traditionally the largest M&A market in Latin America, the aggregate deal value of $30.7 billion in the first half of 2012 fell to $19 billion in the first half of this year.
Russian central bank: Nabiullina makes a splash in first policy meeting
Elvira Nabiullina’s post policy-meeting press conference in July was a first both for her and for the Russian central bank, which she joined as governor on June 24. And although the central bank kept its main policy rates on hold, Nabiullina was by no means short of things to talk about.
Is Kazakhstan a safer bet than Russia?
Kazakhstan is set to remain the safest country in central Asia, and as the economy diversifies away from hydrocarbon and mineral reserves, it could soon precede Russia in the Euromoney Country Risk rankings.
The Indian rupee is likely to remain under pressure despite central bank efforts to slash spot dollar demand, including lending dollars from its reserves to state-run oil companies, but analysts are split over its prospects for the rest of the year.
Can RBI governor-designate Raghuram Rajan save India?
With India’s faltering economy lurching from bad to worse the country’s central bank governor-designate has his work cut out to tackle problems ranging from a falling currency and high inflation to urgently needed structural reforms.
Rupee depreciation exerts costly toll on India's risk profile
India’s ECR score hits a three-year low as spiking inflation and a plunging rupee exact a heavy economic toll at a time of fragile growth.
China struggling to balance growth imperative with structural reform
China’s economy is embarking on a new and critical phase of development as the country attempts to navigate its way beyond growth for growth’s sake to create an economy that serves the needs of its people.
Chinese bond market on long and winding road to maturity
Despite the strides China is making in the development of its $2.7 trillion government bond market, it remains structurally inefficient, thanks to meagre trading volume in an asset class strangled by the country’s fixed interest rate regime. Calls are growing for greater efforts to develop the government and corporate bond market structure in a bid to boost the efficiency of savings and non-bank financing.
China Retail Gold Survey 2013: China’s gold market takes its own path
Activity and prices remain buoyant in China’s gold markets despite the slip in prices in the west.
Latin American asset management: Bram targets US after Japan’s appetite wanes
Bradesco Asset Management (Bram) has established a US subsidiary and has begun to build relationships with distribution managers in the US and Canada to sell Bram’s proprietary funds to north American institutional investors.
Latin American Awards for Excellence 2013: Brazil
Brazilian retail banks have long enjoyed a large and profitable domestic market. But the government’s attempt to lower interest rates, first with dramatic cuts to the base rate and then by pressuring the state banks to expand credit, has changed the tone in the market.
Brazil: The positives of protests
Bears thrive on accelerating inflation, weak growth and a falling real. But a positive, reforming response to protests might transform sentiment in Brazil.
Brazil worst performer in Latin America
The largest South American economy is considered the region’s most vulnerable by economists in June's ECR risk survey, amid an EM bond and equity sell-off.
With one or two exceptions, the majority of former Soviet independent states, alongside Russia, have become riskier this year, continuing longer-term trends.
Central and Eastern Europe Awards for Excellence 2013: Russia
The first quarter of 2013 showed the effect of a more difficult rate environment for Russia’s biggest bank, but in 2012 Sberbank proved that it could continue to increase its profit, even after spectacular rises in 2011 and 2010.
India at a watershed as it confronts the spectre of stagflation
The Brics economies are all experiencing difficult growing pains, but India is probably most at risk of being left behind, afflicted by slowing growth and a raft of legacy structural problems it failed to tackle in the good times.
Asian Awards for Excellence 2013: India
Competition in India remains fierce.
China wrestles with data-accuracy conundrum amid global spotlight
The veracity of official data from China has long been questioned due to inconsistencies, missing key indicators or massaging of the numbers for political reasons. Now the stakes seem higher: the rise in the shadow banking system and question marks over the accuracy of economic and industry data add to fears that calculating systemic leverage in China’s economy is mission impossible.
China: Bankers welcome China clampdown
Bankers focus on positives; say authorities will strike right balance.
China: People’s Bank stays firm to calm fears
Funding squeeze reaches peak; PBoC to safeguard stability.
Asian risks fragment in light of countervailing trends in China and Japan – ECR Q2 2013 results
China and Japan’s contrasting trends create a more even split of safer and riskier sovereigns across Asia as 12 countries see lower scores, 10 push higher and six are unchanged.
China RMB debate: The renminbi’s road to full internationalization
Euromoney’s debate involving leading executives in Asian financial services throws light on the Chinese currency’s progress to full international status and the likely developments that will hinder and advance the process.
Currencies the best way to hedge against China crash
Investors looking to insure against the probability of a hard landing in China should look to the currency market.
Taming of China shadow banks crimped by archaic regulatory structure
The rapid, seemingly uncontrolled, expansion of China’s shadow banking sector is under intense scrutiny because of the risks it poses to the banking system, and the economy itself, but also because the sector is largely unregulated. Urgent steps are needed to beef up regulatory vigilance as China seeks to engineer a contraction of credit to levered sectors.
China’s war on shadow financing raises spectre of credit crisis
Fears are growing that a concentration of bad debt in China’s informal lending or shadow financial sector, is a ticking time-bomb that might not only weigh on economic growth and stoke inflation but could cause a far more damaging banking crisis.
Renminbi overvalued by 30%; China macro risks rise
The appreciation of China’s renminbi in the face of deteriorating economic fundamentals and global disinflation represents a new normal in China’s political economy, but opinion is split about whether the currency is overvalued.