Grupo Santander, winner of Euromoney’s award for best bank in Latin America, has revealed plans to double its Latin American banking business with a $4 billion investment over the next three years. The region is a cash cow for Santander, which realized $787 million of profits in the first quarter, a 47% increase.

The results of Euromoney’s inaugural structured credit poll provide an invaluable insight into what is often an impenetrable sector of the capital markets.

Critics of Goldman Sachs enjoy accusing the firm of being a hedge fund. But such accusations look wide of the mark given that Goldman’s Asia’s equity guru, Hyder Ahmad, has just quit to start his own fund.

Complacency can lead to extinction according to Goldman Sachs’s key principles. The extent to which its bankers take that tenet to heart was amply demonstrated at Euromoney’s inaugural Asia Awards for Excellence in July [see Asia awards 2006 for more on the event]. As guests arrived for the pre-dinner cocktail reception, one sharp-eyed Goldman banker spotted an unfamiliar but evidently important dignitary entering the room, accompanied by an impressive entourage of aides and hangers-on.

Bahrain is experiencing a mutual fund boom, according to the Bahrain Monetary Authority, which says assets under management by BMA-authorized mutual funds have grown by 55% to $8.3 billion in the past year.

When three industry trade bodies join forces to issue a joint statement in response to regulatory proposals it’s clear that they are taking the matter very seriously.

SpencerLake has joined HSBC as global head of debt capital markets after 17 years at Merrill Lynch. Lake had only recently been appointed to a newly created role of head of debt capital markets for the Asia-Pacific region at Merrill. He will be based in London and manage HSBC’s 250-strong origination team. He reports to Daniel Palmer, head of global capital markets.

Building materials company Lafarge has become the first French issuer to issue an SEC-registered deal for five years. But despite the ease with which it did this it seems unlikely many will follow its example.

You always need seat 1A, unless you’ve got a private jet. Your hotel room has to be just so. You’ve got a British Airways black card. Then you’re a travel diva, as Abigail Hofman knows only too well.

Outstanding achievement award: Tan Sri Dato’ Sri Dr Teh Hong Piow, Public Bank, Malaysia

If equity investors paid closer attention to what is going on in parts of the bond market they could avoid kneejerk reactions to what is essentially old news.

Summer began in style on July 13 as Euromoney hosted its annual Awards for Excellence Dinner in London.

“I’d rather put needles in my eyes than give you a mandate!”

Acquisition financing can always run into difficulties, as Axa found out to its cost last month when it printed its €2.25 billion equivalent hybrid debt deal at the high-water mark of volatility. The deal, which financed the purchase of Winterthur from Credit Suisse, was adversely affected by weak equity markets, high hybrid supply and by a surprise announcement by Generali that it would borrow an addition €1.2 billion of hybrid for an acquisition.

The increasing focus on principal finance in Europe was further in evidence in July when UBS hired Andrea Perona from BNP Paribas. Perona will head a new principal finance business at UBS that lost three of its senior securitization team to Bank of America in early 2005. He was previously head of southern European securitization at BNP Paribas.

Results from the fourth semi-annual surveys of foreign exchange volume, published simultaneously by the US Foreign Exchange Committee (FXC) and UK Foreign Exchange Joint Standing Committee (JSC), show that the market is continuing to expand strongly.

Reuters and the Chicago Mercantile Exchange have announced the financial institutions that have confirmed their intention of participating in their joint venture, FXMarketSpace’s Early Adopter Program.

Electronic options market to open cash equity business in the third quarter.

73 the percentage of retail investors who expect the FTSE 100 to end the year higher than its present level, according to a survey conducted by share-trading website ADVFN.

About a third of sell-side analysts could lose their jobs over the next two years as fund managers do more of their own research and independent providers gain market share.

What’s to be expected from a for-profit monopoly?

Keeps lucrative business and becomes an exchange with formal SEC approval.

The Squadra Azzura won the World Cup last month after a shaky start and by steadily improving their performance. It’s a stark contrast to the development of the Italian hedge fund industry. Italy rode the wave of hedge fund expansion by introducing regulation as early as 1999. As a result, growth has been strong. Italian funds now manage €18.3 billion, more than 5% of total hedge fund assets invested in Europe.

By Zach Fuchs

According to TaraCapital’s summer barometer of European investors, demand for long/short equity strategies, particularly those offered by Japan and Europe funds, has fallen. More investors plan to reduce than increase their exposure to European long/short equities. Instead, investor appetite is growing for relative value, CTA and multi-strategy hedge funds.

EFG Private Bank has bought English traditional private client stockbroker Harris Allday, adding £2 billion in assets under management for the UK and Channel Islands. Harris Allday’s 27 client relationship officers will be absorbed into EFG but will trade as EFG Harris Allday.

Investors who might have hoped that their allocations to hedge funds would have provided some relief from falling equity markets in June must have been disappointed. The Hennessee Hedge Fund Index underperformed the broad equity market that month, falling 0.23 percentage points, a performance that was slightly worse than the 0.16 point fall in the Dow Jones Industrial Average over the same period, and much worse than the 0.14 point rise in the S&P500.

“As you can see, we’re keeping our operating expenses down,” jokes Nigel Harris, CEO of New Philanthropy Capital, as he ushers Euromoney into a cramped and bare meeting room in its LondonBridge office. It’s probably a far cry from the plush quarters to which he was accustomed in his investment banking days at Schroders but such frugality seems appropriate to his new role at a firm that seeks to galvanize the charitable sector. By providing detailed analysis of charities to donors, New Philanthropy Capital hopes to help them direct their money where it will be best used. “We want money to be better allocated,” says Martin Brookes, head of research, “and then hopefully the realization that this is happening will encourage more people to give.”

Henderson Global Investors wants to be taken more seriously in the hedge fund market. The firm launched its first hedge fund in 1999 – a global tech long/short fund – and now runs $2.5 billion in 15 funds. To build the business further, Henderson has been recruiting distribution talent from hedge funds and is ready to attack the US market.

We mentioned earlier this year how Marcus Browning, former co-head of FX trading at Merrill Lynch, had engineered a move to Citi, purely, if rumours are to be believed, to get some sustained training for this year’s Etape du Tour. Unfortunately, Browning failed again this year to get the gold standard handed out to high finishers in the event. Having finished a splendid 820th out of more than 7,500 starters, Browning has every right to feel slightly aggrieved.

Private equity firm Technology Crossover Ventures (TCV) has taken a minority stake in multi-bank trading platform FXall for $77.5 million. FXall declined to reveal what percentage of the company this represents, but in February, Euromoney revealed that the company, established in 2000 by a consortium of 17 banks, was in discussions with private equity to sell a stake of between 25% and 30%.

Slovenia is set to become the first of the new EU member countries from central and eastern Europe to adopt the euro, after EU finance ministers cleared its entry. Slovenia will take up the currency on January 1 2007, bringing the number of eurozone countries to 13. An exchange rate of Tr239.64 to the euro has been set.

If international football teams performed according to economic criteria, one from the eurozone would not necessarily come out on top.

Two years ago structured credit was a cottage industry. Now it’s the sector every major investment bank wants to grow in. Alex Chambers reports on the conflicting dynamics of the market, and how banks are trying to position themselves. And in a brand new poll, Euromoney reveals the leaders in the market.

With the recent sell-off behind them, Japanese and eurozone equities look to be more attractive growth or defensive prospects than US stocks.

Michael Jinn, co-head of European CDO structuring and head of securitization coverage for Portugal at Deutsche Bank, has left the bank to rejoin his old boss, Michael Raynes, at Citigroup. Raynes, who was global co-head of the securitized products group and global head of CDOs at the German bank, surprised the market by jumping ship to Citi earlier this year. He is likely to raid his old Deutsche team for further staff in the future.

Do the US capital markets require rating agencies to continue to be regulated? It’s a question raised by legislation recently passed by the US House of Representatives and working its way to the Senate.

Would the relatively small capital-raising needs of African sovereigns be best satisfied by joint international issuance or by wider use of their individual domestic markets?

One year on from its prototype of efunding, Ekportfinans has launched the full version of its electronic funding platform, an innovative approach by the Norwegian export financing agency to operating its structured medium term note funding operation.

The idea that Venezuela might issue a bond on Argentina’s behalf poses more questions than answers.

Users of the EU’s clearing and settlement systems would like to see a firmer hand on the tiller.

Further proof – if any were needed – of Russia’s increasing financial clout on the international capital markets came one balmy Friday evening in July.

Recent events surrounding the future ownership of Hong Kong fixed-line carrier PCCW [see Hong Kong: Wrong connections] offer evidence that Asia’s private equity market might be overheating. The zeal with which Texas Pacific Group and Macquarie have pursued an acquisition of the key assets of the group suggests that they might be struggling to find suitable investments in the region.

Our congratulations to Elaine Bridge, a PA at HBOS Treasury Services in London, who won the prize draw for participants in our revamped Business Travel poll (go to page 85 to see what investment bankers consider the best hotels, airlines and restaurants in the world).

Market participants need to focus on the relevance of information, and not just information for its own sake.

Mexico will issue its first 30-year peso-denominated bond in Q4, reflecting renewed confidence in the Mexican economy. Initially an auction of Ps1 billion ($92 million) is planned.

When asked what vexes him most in his dealings with investment bankers, Fabio Barbosa, CFO of Brazilian mining company Companhia Vale do Rio Doce (CVRD), takes a few moments to think. He is certainly in a good position to offer an opinion. His company’s $1 billion 2016 bond was the largest ever Brazilian corporate issuance in the global capital markets; it has been able to issue cheaper debt than the sovereign; it comes to market regularly and leverages its global reputation and investment-grade rating to achieve extremely aggressive pricing on its bonds.

The latest GDP figures from China make startling reading. First-half 2006 GDP grew 10.9%, with second-quarter growth accelerating to 11.2%, the fastest pace since 2003 when China’s economy last overheated. The news has reignited concerns that China’s economy is out of control.

Despite a downturn in emerging markets, Latin American companies are eager to tap the developing hybrid securities market to raise money to recapitalize their balance sheets without affecting their credit ratings or causing equity dilution.

Hungary’s OTP Bank, the only bank in central and eastern Europe to entertain genuine regional ambitions, is turning its attention to Austria as it eyes up the possible purchase of troubled bank Bawag. “We do not know yet if we are interested,” says OTP chief executive Sandor Csanyi. “But we think that our experience could be very useful.” Austrian trade union federation OeGB is selling the bank after it recorded huge losses following murky deals involving its US partner Refco, which collapsed in October 2005. Refco’s creditors are at present trying to locate the US assets of Bawag.

Norway’s export credit agency, Eksportfinans, was the first issuer to take advantage of the Russian government’s decision to make the rouble fully convertible from July 1, selling a R1.5 billion ($558 million) rouble-linked Eurobond less than a week later.

Transelectrica is the country’s first utility to IPO.

G8 debt relief package will not constrain issuance plans.

Lebanon has announced plans to borrow as much as $7 billion by the end of this year as it struggles to reduce interest costs on its debt. According to Moody’s Investors Service, Lebanon’s gross debt had reached 727% of government revenue by the end of 2005, the highest level of any rated country.

By Zach Fuchs

SuperDerivatives, an online provider of option pricing, trading and risk management, is expanding its pricing capabilities on Latin American interest-rate derivatives products, a move that should help boost liquidity in these instruments. The firm has already rolled out its platform for Mexico and Brazil, and Chile and Argentina are next on the list.

The development of Latin America’s local capital markets continues apace following the first bond issue by a multilateral organization in Venezuela in 30 years. The bond, worth B215 billion ($100 million) and with a five-year maturity, was launched last month by CAF, the Andean development bank. It is the biggest non-government bond issued in Venezuela.

Almost non-existent a decade ago, Peru’s capital markets have flourished over the past five years, with the government and big companies such as US copper miner Phelps Dodge finding ample demand for bonds. Now the new government of president Alan García, which took office on July 28, aims to develop the markets further. There are plans to allow smaller companies to raise cash, develop a secondary mortgage market to unleash new funds to redevelop slums, and encourage pension funds to invest in productive industries, not just in sovereign bonds. “Deepening the local market in soles is going to be one of the pillars of our economic policy,” says García’s chief economic aide, Enrique Cornejo. “Our resources aren’t being put to work via the markets.” The barriers to smaller Peruvian businesses are daunting. Because many companies cannot meet the listing requirements of the Bolsa de Valores de Lima, Peru has launched only four initial public offerings with a total value of $40 million in the past 15 years, despite strong economic growth. The business sector is severely undercapitalized, with a total of $7.5 billion in debts, or around 10% of Peru’s GDP. A change in that situation is crucial to Peru’s long-term development, as small and medium-size companies generate 40% of GDP and three-quarters of all jobs in the country. However, these companies’ financing costs are up to 2.5 times those of big corporations.

“Bond of the South”

Argentine banks’ holdings of public debt are to be restricted to a maximum of 35% of their assets, the central bank has announced. The measure aims to reverse the crowding-out effect by inducing banks to focus on private investment. “This provides additional degrees of freedom to conduct monetary policy, increasing the systemic independence from treasury needs and minimizing the ‘fiscal dominance’ that historically characterized our economy,” says Martin Redrado, Argentina’s central bank governor.

Despite grumblings from hedge fund managers about the way they are treated by the media, a survey by Horizon Cash Management shows that not all of them are unhappy with the coverage. Forty seven percent of hedge fund managers surveyed considered press coverage of the sector to be unfair, but 46% thought it was pretty neutral.

HSBC becomes the first private banking client to sign up to SEI’s global wealth service. SEI has spent three years developing front-to-back-office products and services to aid wealth managers and individual high-net-worth clients.

Following the recent appointment of Robert Taylor as CEO, Kleinwort Benson Private Bank and Kleinwort Benson Channel Islands are amalgamating and will become known simply as Kleinwort Benson. The bank has also begun an expansion of its regional office network in the UK.

In a motion filed with a US bankruptcy court at the end of June, Refco announced that it had entered into an agreement to sell its retail FX business, including customer account information and related assets, to Gain Capital Group. Both parties announced that, under the proposed terms of the deal, Refco FX’s clients could recover up to 100% of their currently frozen account balances.

Inaugural mortgage securitization is sign of a fast-developing market.

Fix Protocol has issued a white paper on foreign exchange, after a 2005 survey by TowerGroup predicted a sharp increase in its use among market participants. TowerGroup found that 15% of sell-side firms and 25% of the buy side they surveyed were already using Fix version 4.4 for FX trading; this is expected to rise to 40% and 60%, respectively, by 2008.

German SME CLO deals continue to appear, despite disagreement on how these risks should be assessed.

Anyone investing in private equity now is making a bet that the business cycle has been abolished. Caveat emptor.

PCCW is now controlled by Francis Leung. But that’s not the full story.

Further welcome signs that Asia’s real estate investment trust investors are getting more choosy arose in July when Cambridge Industrial Trust relaunched its stalled IPO in Singapore with an enhanced yield to persuade punters to subscribe.

High borrowing levels and possible interest rate rises could threaten profitability in the US and Europe, while Asian and Latin American banking systems become increasingly sophisticated, say analysts from Moody’s Investors Service.

A week is a long time in politics; a month in European CMBS can bring an almost complete reversal of sentiment. The €10 billion of supply in July took everyone by surprise

Emerging market CDOs look more attractive after the recent market correction.

Bill Lipschutz was once considered one of the world’s top-five FX traders. Now managing currency hedge fund company Hathersage, he talks to Helen Avery about why FX is catching the eye of institutional investors and how he sees the trend developing.

Club’s £260 million deal could be joined by securitizations from UK Premiership rivals Liverpool and Man Utd.

The oft-perceived wisdom is that consolidation into the hands of fewer and fewer major players will continue. But the emergence of a new breed of service providers suggests this is simplistic.

When Lebanese climber Maxim Chaya reached the summit of Mount Everest in May, champagne glasses clinked in the executive rooms at Bank Audi. Three years ago, Lebanon’s second-biggest bank decided to take a punt on Chaya (whose brother Nabil heads the capital markets division at the bank) and sponsored him to the tune of $250,000 in his bid to become the first Lebanese to climb the highest point in each of the seven continents (he also trekked to the North and South Poles). Everest was the last stop.

Dubai Investment Group subsidiary Dubai Financial has bought a 40% stake in Malaysia’s oldest Shariah-compliant bank, Bank Islam Malaysia Bhd (BIMB) – the group’s largest single investment in the Asian financial sector to date.

Goldman Sachs has moved Zubin Irani to a new position in its merged real estate group. The bank merged its real estate advisory business and real estate financing business six months ago to create a one-stop-shop real estate client-focused business. Irani, who is co-heading the group, previously headed Goldman’s Whitehall Funds subsidiary for seven years. The Whitehall business is now being run by Benoît Herault.

Dresdner Kleinwort Wasserstein is having a clear-out to make way for the thoroughly modern and revamped Dresdner Kleinwort. In preparation for its facelift, the firm is auctioning off to staff the antique artwork and furniture that adorned its Swan Lane office in London. The George III décor was not in keeping with the new office in Gresham Street, which instead has a Williams F1 racing car in the lobby.

Tan Sri Teh is the first winner of Euromoney’s Lifetime Achievement Award in Asia. His bank, Public Bank, also won best bank in Malaysia for the eighth time.

Joseph Ackermann has just signed on for another four years at the helm of Deutsche Bank. It’s testament to the success he has had in creating one of the world’s most successful banks. A new book seeks to explain why his achievements are lauded overseas but he is disliked in the country that his bank’s name bears. Will domestic difficulties bring his tenure to a premature end?