November 2006
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LATEST ARTICLES
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With falling returns for hedge funds, it looks as if a trend might be developing for their employees to return to less risky, better remunerated roles in investment banks.
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European issuers tapping the US capital market are increasingly using the extendible note market. They are driven by a need for liquid markets and relatively low appetite for the regulatory complications involved with 144a SEC registration
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As recently as May this year, following the two 25 basis point increases of December 2005 and March 2006 that raised the European Central Bank’s main refinancing rate to 2.5%, ECB president Jean-Claude Trichet was speaking of the “still very low levels of nominal and real interest rates across the whole maturity spectrum”.
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It’s somewhat ironic that Dresdner has an F1 car in the building. After all, motor racing is associated with glamour, sex appeal and life in the fast lane – all the things that Dresdner is not.
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“We’ve got samurais, kangaroos and bulldogs – now what we really need is a name for all these bonds coming out of Kazakhstan...”
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At the end of September Petrobras, the Brazilian state-owned oil and gas company, completed dollar and yen issues within days of each other – its first such deals in two years. CFO Almir Barbassa talks to Chloe Hayward about why the company has suddenly become so active again.
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A huge influx of liquidity has made the collateralized loan obligation almost standard fare for Europe’s institutional investors. But as they snap up CLO equity and new credit opportunity funds, they need to choose carefully.
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The increased use of ever more powerful computers in the financial markets is having an unexpected effect on Canary Wharf, London’s supposedly modern, high-tech business location.
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“Another pandemic or a large event risk such as a full-scale ground war, or various nuclear bombs exploding in large cities in any of the three countries would cause a loss for the noteholders”
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Fitch Ratings has launched a wholly owned subsidiary devoted to the credit derivatives sector.
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Private equity has emerged a clear winner from stock market volatility in the Middle East – a large number of funds were set up as a result. But is there a risk of a bubble developing in this market too? Kathryn Wells finds out.
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Asia’s property market is growing fast as it moves onto global investors’ horizons. Reits are in the vanguard of that development and are evolving rapidly. Those changes might yet pose challenges for investors. Chris Leahy reports.
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Abu Dhabi Energy Company (Taqa) has sold a $3.5 billion equivalent debut bond, containing a €750 million seven-year tranche, a $1 billion 10-year tranche and a $1.5 billion 30-year portion, making it the largest ever straight bond from the Middle East.
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Banks jostle for league table positions as volumes show no sign of letting up.
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MDM deal heralds new swap technology.
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The City of Moscow’s Sergei Pakhomov hopes that full rouble convertibility will offer a way around restrictive legislation that governs municipal issuance in Russia.
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At a meeting on global real estate last month, the speakers concluded that Latin America was the next investment opportunity, with Mexico at the forefront. Speakers also named Chile, Brazil, Venezuela and Argentina as countries to watch. Real estate in Mexico, which has traditionally been driven by Americans, is now starting to see local and other foreign investment.
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Bolivia signed a deal last month worth $17 billion that is set to triple its sale of natural gas to Argentina. Under a new contract, Bolivia will increase exports to Argentina from the current maximum of 7.7 million cubic metres a day to 27.7 million cubic metres a day over a 20-year period beginning in 2010.
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Italy’s Sanpaolo IMI has won the race to acquire Bank of Alexandria. It will pay $2 billion for an 80% stake in the bank, Egypt’s fourth largest. It outbid a consortium of banks comprising Jordan-based Arab Bank Group and Saudi Arabia’s Arab National Bank. Other bidders had included Dubai’s Mashreqbank and Dubai Investment Group, Egypt’s Commercial International Bank and BNP Paribas.
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As governments across the continent are engaging in economic reforms and building their country’s infrastructure, new types of investors are starting to see Africa as a safe bet when searching for higher returns.
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Oman’s Blue City Investments securitization packages a series of unusual risks for ABS investors.
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SOME 50,000 small- and medium-size companies in Chile will benefit from a proposed new law that will make it much easier for companies to switch bank lender, according to banking experts.
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Electronic trading of Japanese government bonds will account for half of the inter-dealer market by the end of 2006, according to estimates in a report published by research firm Celent.
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Chávez says that he might try to seize four companies operating in Venezuela owned in part by Exxon, ConocoPhillips, Chevron, Total and Statoil.
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Investment banks in Japan are preparing to compete for a share of the lucrative market for corporate hybrid capital issuance that they hope will develop following retailer Aeon’s pioneering 50-year security.
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As the unremittingly positive attitude of investors and analysts towards Vietnam just seems to get even more positive, capital raising for new fund launches is rising fast.
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Evolution Securities China to bring China Medstar to London’s junior market in latest deal.
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An inaugural Asia Pacific wealth management survey from Merrill Lynch and Capgemini highlights the growing concentration of the region’s wealth in the hands of the already rich, deemed high-net-worth individuals (HNWIs).
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There is anecdotal evidence that hedge funds have been increasingly important players in emerging markets for some time now. But a new report from Greenwich Associates has quantified the trend to a startling extent.
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Latin America’s bankers take note. If Gaetan Bucher has his way, within four years they will be living and working in the Dominican Republic (DR).
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Regulators hope to repeat their success in reforming practices in the credit derivatives market.
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Strange market conditions prevail as companies face investors that are spoilt for choice and hedge funds that are increasingly cautious.
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NYSE will keep the floor alive having introduced electronic trading; critics say floor traders will soon be swamped.
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In two new reports, TowerGroup makes the easy prediction that daily volumes in FX will soon surpass $3 trillion. But making sense of whether the market will consolidate has proved harder to predict for the consultancy firm.
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But are the banks really supporting the programme?
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The central banks of Argentina and Brazil are putting together a proposal that will ease trade payments between importers and exporters in the two countries.
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After the defection of three of its key FX staff to Merrill Lynch, Dresdner Kleinwort has acted quickly to try to instil some stability into the business unit.
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Bank of New York has launched a new website offering “enhanced FX research and analysis capabilities, including detailed data on cross-border investment trends, daily FX commentary, in-depth examination of economic news and central bank decisions, as well as coverage of daily worldwide events that affect currency, equity and fixed income markets”.
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91% the increase in real estate/property sector IPOs year to date over the same period last year. Global IPOs in the sector have raised $21 billion so far, already the highest ever yearly volume, according to Dealogic.
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Longer-term investments can antagonize investors with shorter-term views. Ritchie Capital looks to have found a way to defuse the conflict.
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Spotted on hedge fund website Albourne Village’s ordinarily sensible and informative Residents’ Questions Board:
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A survey by the Bank of New York and Casey, Quirk and Associates shows that, while hedge funds may be receiving criticism from some governmental bodies, institutional investors are quite content with them. Only 3% of the 101 institutional investors surveyed said that their hedge fund programme had underperformed their expectations. Seventy-two percent said that their hedge fund had performed within 1% of their target expectations, and 25% claimed it had exceeded their return target by 1% or more.
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Ben Shoval and his partners have found a lucrative real estate niche: early stage, short-term funding for sound, non-speculative developers. Helen Avery reports.
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London-based buyout firm Doughty Hanson’s decision to pull its planned €1 billion IPO on Euronext in October suggests there’s not much retail or high-net-worth demand for private equity when some commentators are already calling the top of the market. Kohlberg Kravis Roberts managed to raise $5 billion through its Euronext IPO earlier this year but Apollo subsequently struggled to raise $2 billion and both firms’ shares have been underwater since. At the beginning of October, KKR was trading at a 16% discount.
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Despite reasonably supportive market conditions, a record level of M&A, and confident predictions from investment bankers, the volume of new convertibles issuance in Europe over the past four months has dropped to a trickle.
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It’s easy to see why Brian Hunter of Amaranth notoriety – and so many others – were caught long of natural gas. The prices of natural gas have risen dramatically since 2000. But how much of that increase has been due to underlying supply and demand?
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Tata Steel’s bid for Corus is at the vanguard of corporate India buying cross-border assets.
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CHAMPAGNE CORKS WERE popping in Lisbon to herald the smooth passage of Portugal’s covered bond legislation. So Europe has yet another covered bond market, news that will have been greeted with a certain amount of resignation in Italy by both banks and regulators. It all looks so easy, but somehow Italy has made it look very, very difficult.
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Washington Mutual has broken new ground in several areas during the past year. Not least as the first American issuer of a covered bond. However, it made a substantial impact with its hybrid issuance too. WaMu’s treasurer, Robert Williams, explains his bank’s financing strategy to Alex Chambers.
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There are signs that liquidity-generated inflation is spreading from financial bubbles into the output economy.
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The privatization of Japan Post means that a huge store of capital will be unleashed into the private sector. Lawrence White travelled to Tokyo to find out what progress has been made, and to assess the likely effects of this historic IPO on the global capital markets.
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SG aims to capitalize on the increasing demand for credit derivatives as a risk mitigation tool.
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The back office is the unglamorous end of the deal chain. But as some banks are now finding out, keeping the pipes clear is vital if business is to be kept flowing from the front end. Lee Oliver reports.
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The price that Macquarie was prepared to pay for Thames Water graphically illustrates the impact that infrastructure funds are having on this sector.
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Model can help to attract new investors to asset class.
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Technological developments in multilateral trading facilities look set to be much more significant than link-ups between private monopoly exchanges.
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Yucho privatization is a big ask for Japan’s financial sector.
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Private equity in the Gulf is developing fast but investors need to seek out experienced firms.
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Euromoney’s inaugural debt trading poll gives unprecedented insights into the increasingly complex derivatives-led world of debt trading.
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In October, two rating agencies struck down Italy’s credit ratings: Fitch lowered the republic’s long-term debt rating to AA–; Standard & Poor’s now has it at a lowly A+.