Wednesday, 12 December 2018
IN A CLASS OF ITS OWN - Dealing with a major revamp might well hold back substantive progress in any bank’s business. But in this particular case, the complete rewiring of the organisation was completed as the house enjoyed its best year since it began its long conversion to full-status investment bank some 10 years ago. Deutsche Bank is IFR’s Bank of the Year for 2005.
GAZPROM SHOWS ITS MIGHT – Gazprom had its finest year in 2005. After two years of innovation in the bond markets that had seen it win awards for innovation, the Russian oil and gas giant came back for more bonds and also for jumbo loans. For the ease with which it issued well-executed bonds and loans, Gazprom is IFR’s Borrower, Supranational/Agency Borrower and European Borrower of the Year.
LONG AND WINDING ROAD - In a year which turned out healthier for bond issuance than many had predicted, boasting an impressive market share was not enough. Leadership was the key ingredient in spearheading major campaigns such as duration and innovation. This, together with building on its awesome product and geographical footprint, makes Deutsche Bank IFR’s Bond House and Euro Bond House of the Year.
INNOVATION WINS THE DAY - There are two faces to the European securitisation market. One is represented by the increasingly commoditised RMBS business, while the other is characterised by innovative solutions to financing problems. For embodying that spirit of innovation, Barclays Capital is IFR’s European Securitisation House of the Year.
AN UNSTOPPABLE FORCE - The good old days returned to the bank market in 2005. The long-awaited M&A revival finally took place, liquidity reached unprecedented levels, institutional loan and second lien issuance reached new highs, leveraged buyout records were smashed and trans-Atlantic syndications became commonplace. For driving these key trends, JPMorgan is again IFR’s Loan House of the Year and US Loan House of the Year.
TAKING THE BULL BY THE HORNS - The leveraged loan market went on a bull run in 2005, as institutional loan issuance reached an all-time high and second-lien volume continued to soar. While keeping active in LBOs, one arranger also propelled the second-lien market forward and brought innovative transactions to supply-starved investors. For continuing to lead and innovate, CSFB is IFR’s US Leveraged Loan House of the Year.
TRAILBLAZING APPROACH - Equity capital markets is just one division within an investment bank, and sales, trading and research are equally important to the proper placement of an equity deal. For its trailblazing approach to structuring its capital markets business, and its resulting achievements in ECM, Lehman Brothers is IFR’s US Equity House of the Year.
FOCUSING ON FUNDAMENTALS - Most of the factors that have made CBs an attractive vehicle for US companies did not exist in 2005. As equity volatility plunged and credit spreads remained at attractive levels, straight debt was a more viable alternative. For the disciplined approach needed to deal with skittish issuers and investors in this environment, Lehman Brothers is IFR’s US Structured Equity House of the Year.
AT THE HEART OF THINGS - Credit correlation price swings and flat yield curves tested the derivatives markets in 2005. But the global quest for higher returns and tailored business solutions outweighed these concerns. For trading its way through market challenges and offering an unprecedented combination of market solutions, Deutsche Bank is IFR’s Derivatives House, Credit Derivatives House and Interest-Rate Derivatives House of the Year.
The past 12 months in global capital markets gave the impression of being prone to volatility and nervousness, but in truth it was a fabulous year. The downgrades of Ford and General Motors, and the reverse in correlation, created some worrisome moments, but dealers and investors shrugged off the effects pretty quickly, and the credit market continued its rollercoaster ride.
ECONOMIC TRENDS: Opinions on growth, inflation and interest-rate prospects are sharply divided, particularly about the US. Some forecasters expect growth to remain robust, prompting increased risk of second-round effects on inflation from higher commodity prices. Others believe that higher oil prices will act as a significant drag on economic activity, taxing the consumer and squeezing company profit margins further. Who will be right? Phyllis Reed reports.
LONG-DATED BONDS: Demand for long-dated assets was a well-advertised feature of the fixed-income market in 2005. Around the globe, issuers stepped up to answer investors’ needs, while taking advantage of low absolute yields. Helene Durand examines the drivers behind the push for ultra long-dated issuance, and whether 2006 will see a continuation of the trend.
M&A: While the scale of the European M&A “boom” has been exaggerated, the 75% increase in total value of deals during 2005 is certainly striking. With a look at the year’s data in more detail, Henry Gibbon and Neil Sen suggest what is needed for this recovery to be sustained.
HEDGE FUNDS: As their extraordinary growth continues, the potential for the behaviour of hedge funds to affect global markets has become a preoccupation for regulators in several major jurisdictions. But with evidence of damage caused by hedge funds largely anecdotal, and given the concerns over the feasibility of regulating the industry, is increased regulation worth the effort? Could it simply create new problems? Paul Farrow reports.
REGULATION: As EU regulation continues to evolve, bankers are having to work within a changing landscape. In 2005 it was the Prospectus Directive that affected bond issuance. The next hurdles are the Transparency and MiFID Directives, and it does not stop there. Helen Bartholomew reports.
JAPAN: In the midst of its third longest post–war economic expansion, Japan followed up 2004’s robust performance with more progress in 2005, brushed aside its naysayers with conviction, and ushered in a palpable feeling of confidence. An unusually stable and reformist political regime has clearly been a huge boost, but the next major challenge – ending the deflationary spiral – remains a daunting one. Brad Frischkorn and Tim Eustace report.
EMERGING MARKETS: Emerging market debt continued to boom in 2005. Big inflows and limited supply helped spreads to grind tighter, refuting the doom-mongers who had called the top of the market years earlier. With local currency debt increasingly a focus of attention and credit derivatives offering alternative exposure, EM debt is firmly in the mainstream, writes Felix Salmon.