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Saturday, 25 June 2016

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Vote Leave campaign leader Boris Johnson

All gone wrong

IFR 2139 25 June to 1 July 2016

The one thing everybody knew last week was that Britons would never vote to Leave.

Top News

A trader from BGC reacts after Britain voted to leave the European Union

Brexit plunges markets into turmoil

IFR 2139 25 June to 1 July 2016 By , , ,

European capital markets have been plunged into deep uncertainty after the UK voted to leave the European Union, with bankers and investors struggling to digest what the unprecedented decision will mean.

Bank Street sign

Banks braced for pain after Brexit bombshell

IFR 2139 25 June to 1 July 2016 By Steve Slater

Thousands of bankers in Britain are fretting about their job security as the industry faces upheaval in trading operations and regulations in the wake of Britain’s decision to quit the European Union.

RBS building in London

Bank bonds plummet as UK walks

IFR 2139 25 June to 1 July 2016 By

UK and peripheral bank bonds were hit hard in secondary markets on Friday following Britain’s vote to leave the European Union.

A Union flag flies next to the flag of the European Union

Equivalence is key for post-exit UK banks

IFR 2139 25 June to 1 July 2016 By

The UK’s vote to leave the European Union is unlikely to give banks the bonfire of red tape long promised by many campaigners against EU rules and regulations.

Gold bullion

Referendum decision leads to gold rush

IFR 2139 25 June to 1 July 2016 By

Gold jumped as much as 8% on Friday, hitting a two-year high of US$1,358 an ounce as investors flooded to the world’s safe-haven asset in response to the UK’s vote to cut its ties with the European Union.

A man dressed as DC Comics' The Question in Manhattan

Unknown loan buyer triggers intrigue

IFR 2139 25 June to 1 July 2016 By , Kristen Haunss

A mysterious buyer is causing a stir in the US leveraged loan market.

Oi logo

Oi filing sparks CDS speculation

IFR 2139 25 June to 1 July 2016 By Robert Smith

Holders of Oi’s credit default swaps will be among the few investors cheering its bankruptcy filing, particularly as certain buyers were due to see their protection expire just hours after the Brazilian telecoms company filed on Monday.

Veneto Banca logo

Veneto rescue tests depleted Atlante

IFR 2139 25 June to 1 July 2016 By Graham Fahy

Italian rescue fund Atlante will take a substantial hit on its €1bn purchase of Veneto Banca shares even if the struggling bank is split into good and bad parts in an effort to find a buyer.

Twilio leaps in debut

Twilio surge reassures on unicorn demand

IFR 2139 25 June to 1 July 2016 By

Twilio’s near doubling on its debut last week proved US IPO investors do retain an appetite for large non-profitable tech companies, or so-called “unicorns”, stirring hopes of a long-awaited rebound in sector deal flow.

Chinese souvenirs

China to rattle sovereign debt battles

IFR 2139 25 June to 1 July 2016 By

Extensive lending by China to countries in emerging markets looks set to complicate the next wave of sovereign debt restructuring, particularly as the country has yet to join the Paris Club of official sector creditors.

IFR Magazine Top News in Full (subscription required)

People & Markets

Jonathan Rogers

Indonesia's coal offers a cautionary tale for creditors

IFR 2139 25 June to 1 July 2016

FORGIVE MY RETURNING to Indonesia just a week after my last column on the topic but it’s worth the deja vu, since a big(ish) restructuring over there is winding its way to the supposed finish line and it shines a light on much else besides.

US Federal Reserve building

US banks sail through stress test

IFR 2139 25 June to 1 July 2016

US banks were able to stay at least one step ahead of the Federal Reserve in the latest industry health-check, easily passing an annual test that had more demanding scenarios compared with previous years.

Visa credit cards

Visa deal to give Europe's banks timely Q2 lift

IFR 2139 25 June to 1 July 2016

Dozens of European banks will book hefty windfalls in the second quarter from the sale of their stakes in Visa Europe, after Visa Inc this week completed the purchase of its sister card payments firm.

Rothschild & Co logo

Rothschild reports record advisory revenues

IFR 2139 25 June to 1 July 2016

Rothschild & Co reported record annual revenues in its financial advisory business last week but warned that repeating that result in the current financial year will prove a challenge.

Jefferies logo

Jefferies ends FICC slump and signals brighter Q2

IFR 2139 25 June to 1 July 2016

The outlook for Jefferies has brightened thanks to stabilisation in markets in its latest quarter, helping the bank end a multi-year slump in fixed-income trading.

    More from People & Markets

    Bonds

    A trader from BGC reacts to the EU BREXIT referendum news

    US immune to Brexit volatility

    IFR 2139 25 June to 1 July 2016

    The UK’s stunning vote to quit the European Union roiled the global markets, but borrowers raising debt in the US may turn out to be largely immune to the turmoil.

    Logo of the European Investment Bank

    EIB primed for post-Brexit hiatus

    IFR 2139 25 June to 1 July 2016

    The European Investment Bank is likely to have to put its bond issuance on hold for the foreseeable future after the UK voted to leave the European Union last week. 

    ECB surprises with aggressive tack

    IFR 2139 25 June to 1 July 2016

    The European Central Bank’s corporate sector purchase programme got off to a strong start, with volumes in the first few days exceeding expectations.

    Brexit stops market

    IFR 2139 25 June to 1 July 2016

    Before a result few saw coming upended the market, most market participants were pretty sure the UK was going to choose to stay in the European Union.

    Molson monitoring market after Brexit

    IFR 2139 25 June to 1 July 2016

    Molson Coors Brewing Company is in wait-and-watch mode with its plans to raise US$8bn in bonds this week to help finance its purchase of SABMiller’s 58% stake in MillerCoors, after markets turned volatile following the UK’s decision to exit the EU.

      More from Bonds

      Loans

      GF Securities sign

      GFSec back on borrowing trail

      IFR 2139 25 June to 1 July 2016 By Carol Zhong

      After a challenging year for stock markets in China, GF Securities is back in the market for a loan of HK$3.5bn (US$451m), significantly bigger than its previous borrowing.

      Sogo department store

      Sogo shops for refinancing

      IFR 2139 25 June to 1 July 2016 By Chien Mi Wong

      Department store Sogo, the owner of a prime piece of real estate in Hong Kong, is wooing lenders for a HK$8bn (US$1bn) refinancing loan, which comes with rarity value and tight pricing amid a lack of deal flow in the city.

      United Biscuits logo

      Leveraged loan market left reeling by Brexit

      IFR 2139 25 June to 1 July 2016 By Hannah Brenton

      The European leveraged loan market has entered a period of uncertainty after Britain voted to leave the EU.

      Logo of data analytics firm Qlik Technologies

      Alternative lenders step into revolvers as maturity wall looms

      IFR 2139 25 June to 1 July 2016 By Leela Parker Deo, Jonathan Schwarzberg

      Alternative lenders are expected to take a larger share of leveraged lending from banks in the next two years as the non-bank lenders step in to help refinance the first wall of revolving debt to come due since updated leveraged lending guidance was implemented in 2013.

      Dell logo

      Brexit fears spread to the States

      IFR 2139 25 June to 1 July 2016 By , Lynn Adler, Jonathan Schwarzberg

      Economic and market upheaval spurred by Britain’s vote to leave the EU is spilling into the US leveraged loan market, knocking down bid prices and chilling new issuance while volatility escalates.

      Krispy Kreme doughnuts

      Krispy Kreme acquisition loan in market

      IFR 2139 25 June to 1 July 2016

      Krispy Kreme Doughnuts launched a US$500m loan via Barclays that will back the company’s acquisition by Luxembourg-based investment firm JAB Holding.

      A man dressed as DC Comics' The Question in Manhattan

      Unknown loan buyer triggers intrigue

      IFR 2139 25 June to 1 July 2016 By , Kristen Haunss

      A mysterious buyer is causing a stir in the US leveraged loan market.

      Cardinal Health ups revolver

      IFR 2139 25 June to 1 July 2016

      Drug distribution company Cardinal Health has increased its revolving credit facility to US$1.75bn from US$1.5bn and extended the facility to June 2021 from 2018.

      More from Loans

      Equities

      China Securities Regulatory Commission headquarters

      China crimps backdoor listings

      IFR 2139 25 June to 1 July 2016

      Companies looking to bypass China’s backlogged IPO pipeline through backdoor listings face new hurdles in light of draft regulations intended to clamp down on reverse takeovers.

      Algeria Stock Exchange

      IPO cancellation dents Algeria pipeline

      IFR 2139 25 June to 1 July 2016

      Hopes that the IPO of Societe des Ciments de Ain El Kebira (SCAEK) would continue the rapid expansion of the Algiers Stock Exchange have been dashed by a lack of interest.

      Centennial Resource Development logo

      Centennial Resource opens doors for public viewing

      IFR 2139 25 June to 1 July 2016

      Centennial Resource Development, a Permian Basin-focused exploration and production company, has started the clock ticking on its IPO. The offering would be the first by a US E&P in over two years and stands to benefit from growing investor interest in the Permian, and the Delaware Basin of the Permian in particular.

      Bank of Jiangsu

      China faces US$1.1bn IPO test

      IFR 2139 25 June to 1 July 2016

      Bank of Jiangsu has started pre-marketing China’s largest domestic listing since the country resumed IPOs last November, in a sign that regulators may be loosening controls on the size of listings one year after the market’s collapse.

      Inghams Enterprises logo

      Aussies hatch year's largest IPO

      IFR 2139 25 June to 1 July 2016

      Preparations for Australia’s largest listing of the year are under way as poultry producer Inghams Enterprises has mandated six banks for its potential IPO of A$1.5bn (US$1.1bn).

      Windstream office

      Windstream stages exit from REIT spin-off

      IFR 2139 25 June to 1 July 2016

      Telecoms company Windstream has sold its remaining 20% stake in wireless infrastructure REIT Communications Sales and Leasing in a two-part deal that reduces its debt burden.

      Brexit deals latest blow to US ECM

      IFR 2139 25 June to 1 July 2016

      A sub-par year for US equity capital markets got even tougher last week, as market volatility in the wake of the “Leave” campaign’s victory in the UK’s European Union referendum put near-term deal flow under a dark cloud.

      Switzerland: Books open for Investis float

      IFR 2139 25 June to 1 July 2016

      Books opened last Tuesday for the SFr161.53m–SFr166m (US$168m–$173m) SIX Swiss Stock Exchange IPO of real estate group Investis. The company is targeting SFr150m of primary proceeds from a price range of SFr49–SFr68, with founder and chief executive Stephane Bonvin selling a small stake of 235,294 shares, with an option to increase the size to 1.455m shares.

      More from Equities

      Derivatives

      European Union flag

      Brexit casts doubt on derivatives rules

      IFR 2139 25 June to 1 July 2016 By

      UK derivatives traders face two years of uncertainty surrounding their activities after the country’s vote to leave the European Union cast doubt on the scope of recent derivatives reforms and contractual terms that could be impacted by the surprise outcome.

      BCP, BMPS 5yr CDS

      BCP switch trade cost jumps on finance concern

      IFR 2139 25 June to 1 July 2016 By

      Banco Comercial Portugues, Portugal’s largest listed bank, has come under pressure in credit markets in recent days on concerns the bank may not have sufficient capital to cover its liabilities and carry out plans for an early redemption of contingent convertible securities.

      Citadel Securities office

      Citadel adds custom swaps in rapid expansion

      IFR 2139 25 June to 1 July 2016 By

      Citadel Securities has expanded its ambitions beyond benchmark vanilla interest rate swaps with a push into customised derivatives as the new entrant encroaches further onto the turf of big swaps dealers that have dominated the market for decades.

      Ethereum logo

      Smart contract doubts rise on DAO hack

      IFR 2139 25 June to 1 July 2016 By

      The Ethereum distributed ledger platform was under pressure last week after hackers penetrated its most valuable smart contract and stole around US$50m in virtual currency.

      UK swap spreads show fiscal concern

      IFR 2139 25 June to 1 July 2016 By

      UK interest rates swap spreads held steady on Friday, while their German counterparts widened, as a flight to quality in Gilts was offset by rising concern that an economic slowdown will lead to a leap in government borrowing.

      More from IFR Derivatives

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      Capital CityCapital City logo    

      A commercial development in Williston, North Dakota

      Draft white paper in works to address CMBS risk rules

      24 June 2016 By

      Four top law firms are working on a white paper that some hope would help bring more clarity to risk-retention regulations in the CMBS market which come into effect at the end of the year.

      Logo of Italian gaming firm Sisal

      High-yield hit by Brexit but no panic selling

      24 June 2016 By Robert Smith

      European high-yield bonds tumbled on Friday after the UK voted to leave the EU, but buyers looking for bargains helped stem some of the fall.

      Logo of Nordic asset manager Accunia

      UK ABS battered as Leave vote prevails

      24 June 2016Updated: 24 June 2016 By Mariana Ionova

      The UK’s vote to leave the European Union sent the securitisation market reeling on Friday, blowing out spreads and casting doubts over the future of the sector.

      Canary Wharf in London

      UK banks, financial sector reel after Brexit bombshell

      24 June 2016 By Sinead Cruise, Andrew MacAskill

      Britain’s 2.2m financial industry workers face years of uncertainty and the risk of thousands of job cuts after the country voted to quit the European Union, leaving question marks over London’s status as Europe’s premier financial centre.

      A panel displays the Hang Seng Index

      British vote causes wild swings in Asian credit, currency

      24 June 2016 By , Takahiro Okamoto

      The pound plunged 10% to its lowest level against the dollar since 1985 and US Treasuries tightened more than 20bp as the UK voted to leave the European Union.

      Ballot papers

      Stocks, sterling skid as early Brexit results put Leave ahead

      24 June 2016

      Risk assets retreat as results point to close call on Brexit

      Morgan Stanley

      UPDATE – US banks flex capital muscle in annual stress test

      23 June 2016

      (Reuters) - Big US banks are proving themselves to be stronger and sounder in an annual regulatory stress test, even as the Federal Reserve changes doomsday scenarios to keep them on their toes.

      Centennial Resource Development logo

      PE-backed Centennial Resource opens doors to public

      23 June 2016 By

      Centennial Resource Development, a Permian Basin-focused exploration and production company, has started the clock ticking on its IPO. The offering would be the first by a US E&P in over two years and stands to benefit from growing investor interest in the Permian, and the Delaware Basin of the Permian in particular.

      Securities and Exchange Commission logo

      Merrill Lynch to pay US$415m for misusing customer cash – SEC

      23 June 2016

      (Reuters) - Bank of America Corp’s Merrill Lynch brokerage unit will pay US$415m and admit to wrongdoing to settle charges that it misused customer cash, the top US securities regulator said on Thursday.

      UBS logo

      P&M: Carlos Mendoza joins UBS to head LatAm DCM

      23 June 2016 By

      UBS has hired Carlos Mendoza as head of debt capital markets and client solutions for Latin America, adding to a list of new hires covering the region, a source told IFR on Thursday.

      Bank of America Merrill Lynch logo

      P&M: ​BAML appoints former Greenhill co-CEO head of EMEA M&A- memo

      23 June 2016 By Anjuli Davies

      (Reuters) Bank of America Merrill Lynch has appointed former Greenhill co-CEO Luca Ferrari head of mergers and acquisitions for Europe, Middle East and Africa, according to a memo sent on Thursday.

      Barclays bank

      US dollar bonds tighten as Britain votes

      23 June 2016 By

      US credit markets rallied Thursday, led by UK banks, as Britain voted on whether to remain in the European Union.

      Whiting Petroleum logo

      Whiting Petroleum bonds jump on debt exchange

      23 June 2016 By

      Bonds of Whiting Petroleum jumped by as much as six points on Thursday, after the company announced an exchange of around US$1bn of bonds for new notes that will convert into equity.

      Daniel Pollack

      UPDATE – Argentina reaches US$95m settlement with Greylock Capital

      23 June 2016 By

      Argentina has reached a US$95m settlement with Greylock Capital, according to the mediator involved in talks between the South American country and holdout investors.

      Novo Banco logo

      Novo Banco looks to boost capital with discounted senior tender

      23 June 2016 By

      Novo Banco is seeking to buy back up to €500m of senior debt, some of which is held by retail investors, at a discount to par as it looks to bolster its balance sheet.

      Molson Coors logo

      Molson Coors lines up US$8bn of bonds

      23 June 2016 By

      Molson Coors Brewing Company is planning to issue around US$8bn of bonds across US dollar, Canadian dollar and euros currencies as soon as next week, according to a source close to the deal.

      All Latest news

      Mullin on Libor

      keith mullin

      Could Libor bankrupt the banks?

      07 June 2016

      Just when you thought the most turbulent and dangerous part of the Libor manipulation hurricane had blown itself out, back it comes with a vengeance - not just to darken the doors of the 16 dollar Libor panel bank defendants (including 10 G-SIBs) but to potentially blow those doors off their hinges.

      From the practice of placing a bell around the neck of a castrated ram to lead the flock

      No pain no gain

      IFR 2139 25 June to 1 July 2016

      THE IMPACT OF Brexit smacked Bellwether bang in the face on Friday morning. Rows of shell-shocked, glum-faced commuters travelling into London, to join the thousands who had worked overnight and seen first hand sterling plunge as results came in. Despite a 60% vote for Remain among Londoners, they had been outvoted by their countrymen around the land.

      Opinion

      keith mullin

      Brexit will undermine London as a financial centre

      DOES THE UK vote to leave the EU jeopardise London as a financial centre? That’s the question that’s been on everyone’s lips for months. We might not have had a direct answer to that question immediately, with Morgan Stanley denying a BBC report on Friday that the firm had already begun moving 2,000 London-based investment banking staff.

      Anthony Peters columnist format

      Shock and awe

      I am staggered, I am speechless. It has been one hell of a night and one during which history is in the course of being made. Whether good or bad will be determined over the coming years or even decades but most certainly not in one day’s trading and even less on the last Friday before quarter-end. 

      keith mullin

      The rise and rise of UK investment banks

      IFR editor-at-large Keith Mullin doffs his cap to the rise of UK broker-dealers and investment banks in UK equities and ECM

      Anthony Peters columnist format

      Cometh the hour

      It’s June 23 and what had to be said has now been said, much of what needn’t have been said was also said but, in my humble opinion, much of what needed to have been said was left aside. Now it is up to the voters. 

      James Saft - June 2014

      The smart money is sitting the Brexit panic out

      All over the world financial advisors and brokers are calling clients and urging them to take steps to “make” or “save” money in light of the British vote on EU membership on Thursday.

      Anthony Peters columnist format

      Nearing the end

      If the only escape from endless Brexit talk is to watch 22 millionaires kicking a pigskin, then I suppose I’ll have to stick with Brexit. Let’s face it, it’s nearly over….or at least the referendum part of it is. 

      James Saft - June 2014

      Cheer up, it may never happen

      This may go down as the year it didn’t happen.

      Anthony Peters columnist format

      The longest day? Not this year

      Today is usually the longest day. Not this year, and not to Cornelius Ryan, for whom The Longest Day was June 6, 1944. Nor is it for the man in 10 Downing Street; his longest day will surely be June 23. 

      Anthony Peters columnist format

      Defeat from the jaws of victory?

      I think I was supposed to spend the weekend mulling over the volatility which beset markets last week while trying to frame a view on how, tactically, to approach the new week. In the event, sport and politics kept me busy. England’s rugby team wrestled the Australians to the ground to take a historic series win Down Under and Porsche carried off the honours at Le Mans as the leading Toyota so sadly broke down just four minutes short of the full race time. Talk of snatching defeat from the jaws of victory!

      keith mullin

      Capital or regulation: which would you choose?

      WITHOUT ROBUST CAPITAL markets, economies cannot innovate rapidly or grow sufficiently to create new businesses and jobs. Can’t disagree with that, right?