Sunday, 19 May 2019
Nobody does it better - If investment banking is about making money for your shareholders, Goldman Sachs is clearly the outstanding bank of 2007. But if it is also about servicing clients on both buy and sellside and providing the best advice and the most innovative deals, then Goldman again has much to boast about. Goldman Sachs is IFR’s Bank of the Year for the second year running.
Strategy vindicated - While some banks’ stars have burned bright in recent years, many have found that their approaches did not stand the test of time when the markets turned sour. One bank eschewed modish methods, preferring instead to rely on the tried and tested practice of offering investors high quality, sensibly priced, liquid transactions. Rabobank is IFR’s Issuer of the Year, and FIG Issuer of the Year.
Strength from breadth - Although credit volatility led to pockets of inactivity in 2007, it also added a degree of transparency for those firms able to meet the financing needs of a market spanning everything from domestic industrial debuts to Asian financials. It was in that environment that Goldman Sachs became IFR’s US Dollar Bond House of the Year.
Still dancing - Dismal market conditions gave RBS the opportunity to show it had moved one notch above the other leading securitisation firms in Europe. RBS, the erstwhile new-kid-on-the-block, has become a reliable partner in a particularly adverse market. For the second year running, RBS is IFR’s European Securitisation House of the Year.
Stepping lightly during tricky times - US loans peaked in mid-2007 before tumbling into a decline, when many of the most aggressive arrangers had to painfully write down leveraged loan positions and survive on a dwindling supply of attractive investment-grade deals. For safely navigating one of the trickiest lending environments ever while maintaining a dominant market position, Bank of America is IFR’s US Loan House of the Year.
A steady hand - US leveraged finance in 2007 was marked by two very distinct halves to the year. In the first, risky leveraged buyouts continued apace; in the second, the new issue market bottomed out as credit markets crumbled. For consistent domination and a rational, measured approach to difficult markets, JPMorgan is IFR’s US Leveraged Finance House of the Year.
Still the one to beat - Citi lived up to its potential in 2007, as the bank dominated emerging market issuance across the globe through an unparalleled depth and breadth of transactions. Helped by an extraordinary performance in the sovereign space, Citi is IFR’s overall Emerging Markets Bond House of the Year and Latin American Bond House of the Year.
Trailblazer - A concerted effort to boost its coverage effort across investment banking has paid off for Goldman Sachs. Instead of identifying existing trends and then pouncing – its traditional mantra – the bank was at the forefront of virtually every significant trend that defined the US equity capital markets in 2007. For blazing trails for others to follow, Goldman Sachs is IFR’s US Equity House of the Year.
Standard bearer - For the global convert markets, 2007 was a year of extremes, and one bank navigated the highs and lows with flair. For a footprint that spans and dominates all regions, its diversity of business, and ongoing structural innovation, JPMorgan is IFR’s Structured Equity House, European Structured Equity House and US Structured Equity House of the Year.
At your service - The first half of 2007 saw increased volumes and revenues for banks looking forward to another record year in credit derivatives. The summer crisis then turned the market on its head, leaving service and consistency as the most important issues for clients. For helping the market to weather the storm, JPMorgan is IFR’s Credit Derivatives House of the Year.
The past 12 months were the most interesting and challenging time for the banking industry for many years. But it is in such times that the investment banking industry really earns its money. Anybody can sell a bond deal or an IPO when the market is always going up. It takes brains, good judgment and maybe even a bit of courage to do so when times are hard.
THE BATTLE FOR ABN AMRO: 2007 will forever be remembered for the credit crisis that spread through the entire debt market. But before its scale became apparent, the largest financial services sector transaction had already been set in motion – the takeover of Dutch bank ABN AMRO. The €71bn deal, which involved most of the top firms in the industry, saw twists and turns at every stage. Mark Baker reports.
LEVERAGED FINANCE IN AUSTRALIA: Australia 12 months ago was a market where anything seemed possible for LBO bankers. But the biggest deals stumbled, and then the global credit crunch shut the market down completely. Bankers argue they’re still busy, and that Australia has survived market wobbles better than most, but the really big game is gone for the foreseeable future, writes Chris Wright.
LEVERAGED FINANCE: The savaging in the leveraged finance market in the summer has been delicately referred to as “repricing” by bankers still smarting from multi-billion dollar mark-to-market losses. As arrangers whittle away at a huge backlog of transactions, investors say they now want cheaper deals with more conservative structures, writes Han-Nee Tay.
CARBON TRADING: Emissions reduction is increasingly an important consideration for businesses worldwide, even in countries that have not ratified the Kyoto Protocol. Carbon trading is part of the solution to global warming, but some uncertainties need to be removed before the market can take off and make a real difference to the environment, writes Han-Nee Tay.
ENVIRONMENTAL FINANCE: Investment banks are falling over themselves to create products that take account of the move towards environmental awareness. The market may be young, but it is no longer niche and is set to grow exponentially, writes Han-Nee Tay.
ECONOMIC OUTLOOK: Risks abound on the 2008 horizon, from property busts and restructuring in the banking sector to global recession – but repackaging and fire sales of assets will be an opportunity for some cash-rich investors, including China as well as the oil economies. Vanessa Rossi reports.
FOREIGN EXCHANGE MARKETS: Perhaps the most interesting story to come out of the foreign exchange market in 2007 was the rise, fall and rise again of the Japanese yen-funded carry trade. That story has not run its course and will continue to intrigue. But the biggest story in 2008 may be the pressures on those countries with pegged currencies and so-called dirty floats, writes John Noonan.
HEDGE FUNDS: The Great Sub-Prime Mortgage Crisis of 2007 wasn’t all bad news for the hedge fund industry. Some funds suffered but those that knew what they were doing have come out the other side with profits and reputations intact. The crisis has changed the industry for good, with the bigger and more established funds ever more dominant. Hugo Cox and Matthew Davies report.
ABCP CONDUITS: In the space of a couple of weeks in the summer of 2007, asset-backed commercial paper conduits went from being one of the most obscure parts of the financial markets to being centre of the storm. The people involved in such vehicles barely knew what hit them and are only now beginning to take stock to see where they stand. Savita Iyer reports.
INDIAN M&A: Indian business has become a force to be reckoned with on the world stage. Indian entrepreneurs have the financial muscle, the banking relationships and the management expertise to become significant players in global mergers and acquisitions. But they must guard against over-exuberance, writes Savita Iyer.
JAPANESE BANKS: Japan’s financial giants have avoided the global spotlight in recent years but a steady stream of overseas investments and an unrelenting – if inconspicuous – approach to overseas expansion means Japan’s influence is on the rise. Its formerly heavily indebted mega-banks and brokerages have restructured and recapitalised and are looking to chase overseas growth opportunities, especially in Asia. Govinda Finn and Atanas Dinov report.