The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.

Syndicated loans: Big banks learn to flex their muscles

With jumbo syndicated loans generating large fees - $600 million for Olivetti's deal alone - syndicated lending is suddenly a big revenue earner for investment banks. But how much old-fashioned lending business is there left for the market's smaller players? Jack Dyson reports.

It's going to be a great year for the giants of the syndicated-loan market. Jumbo deals for Olivetti, Vodafone, Emap and Mannesmann have proved the value of loans in acquisition finance and cemented the position of the very largest players. But the news is not so good for the middle tier. In the first quarter of this year, the volume of loans in the $250 million to $1 billion range was down in both absolute terms and in the number of transactions done.

Chris Elliott, head of syndications at Royal Bank of Scotland, says: "If you take all of the M&A deals away, the immediate question is what has happened to all of the general corporate purposes loans? If the merger deals dropped away there would be nothing going on." Leveraged deals and project finance have both been fairly buoyant recently but there will be very little general corporate borrowing until after the millennium. Elliott adds wryly: "It is as if the banks are being kept afloat by the merger mania. We must bless our Olivettis!"

Fewer deals do not mean that syndication teams are not busy. Far from it, says Richard Munn, director of loan syndications at Deutsche Bank.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree