Issuers face up to the debt market shoot-out
Borrowers have rarely been under such pressure. With credit markets volatile and investors jittery, issuing windows are short lived and the penalties for getting timing wrong can be severe. Entering the capital markets has become a lottery. One week they seem stable; the next they seem to be falling apart. And just when it seems that things can't get worse ... they get worse. So who have been the winners and the losers in this daunting new-issue environment?
Borrower of the year
Best agency borrower
Best high-yield borrower Best high-grade corporate borrower
Best securitization borrower Best financial sector borrower
Western Europe | Eastern Europe | Asia | Latin America | North America
The bigger the party, the bigger the hangover. That's how it feels this year for anyone involved in the primary debt markets.
The corporate borrowing binge is over. Even for tip-top, triple-A credits, getting new bond issues away is a headache, while the pain and anxiety of executing deals for lesser-rated names in such topsy-turvy conditions can be stomach-churning.
Volatility in credit spreads is wild. Losses on the buy side are mounting daily. Investors are alarmed to find that they are taking equity-style risk without any prospect of equity-style returns.
Borrowers with their backs to the wall find themselves at the mercy of investors that are both panicky and angry. And investment bankers are starting to fear that the fixed-income engine that has kept them running through the equity and M&A collapse may be running out of juice.
"The corporate world has gone to pieces," says the head of debt capital markets at one leading investment bank in London.