Capital raising poll 2004: Lead banks sit pretty atop volatile market
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Capital raising poll 2004: Lead banks sit pretty atop volatile market

It has been a stop-start year in the international debt capital markets, with banks themselves the latest group of issuers to take advantage of investors' search for yield by raising low-cost funds. Banks' capital markets desks are struggling to sell corporates on the joys of leverage.

Global financing 2004:

Borrowers want it all | Capital raising results tables 

FREDERIC DESCLAUX IS complaining about hiccups. He hasn't got them. The debt markets have.

"The market has fantastic peaks," says SG CIB's joint head of fixed income and derivatives for Europe and Asia. "If you take the first full week in September, the Thursday was incredibly active. Then on Friday everybody was watching TV."

Sudden bursts of activity interrupting periods of stasis have characterized the debt markets this year. January and February were dominated by sovereign, supranational and agency borrowers; late August and September by financial institutions. Not much happened in between.

On the first day of last month, HSBC launched a lower tier two deal that was, at €2 billion, the largest such issue ever in Europe. The same week, ABN Amro launched a €2 billion senior FRN, and UniCredito Italiano priced a €500 million senior lower tier two issue. In September there were also €1 billion lower tier two issues from two comparatively rare issuers, UBS and Royal Bank of Scotland.

"The market can't run at full tilt all the time, but this has been a particularly staccato year," says Mike Coppock, head of FIG DCM at Banc of America Securities.

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