That is the question on the lips of both sell-side professionals and major investors. The latest market sell-off has certainly given all the impression of being more genuine, and perhaps longer-lasting, than a brief pre-summer reversal. The combination of rising interest rates, the bete noire of inflation, peaking commodity prices and nervous equity markets looks on the surface to provide a pretty formidable series of hurdles for the market to leap. Yet for all of the negatives, one underlying f

Barclays, Deutsche Bank, JP Morgan and RBS were mandated to arrange the debt for the Xstrata acquisition of Falconbridge, which comprised a US$3bn three-year term loan at 60bp over Libor, a US$1bn five-year term loan at 70bp over Libor, a US$3bn revolving credit facility at 70bp over Libor and a US$1.5bn 364-day bridge facility paying 50bp over Libor. Additionally, the leads will provide a US$7bn bridge to an equity take-out, which will not be syndicated. In senior syndication, joint lead arrang

The Turkish Treasury hit the ground running this year, taking full advantage of favourable market conditions to launch a well received US$1.5bn 30-year global bond on January 4 as it beat Brazil to the punch for the second year running. The bond was priced at 96.89 with a 6.875% coupon to yield 7.125%, just inside the sovereign curve and equivalent to 258.3bp over US Treasuries and 206bp over mid-swaps. The sovereign's second deal of 2006 went smoothly, with the Treasury securing the €750m it wa

Since June 2005, ResCap has tapped the dollar market in five transactions for US$10.5bn, including a US$1bn subordinated offering in April that carried high-yield ratings. It also issued €750m and £400m in a two-part transaction in May to bring the financing raised in the last year to approximately US$12bn. The repayment of inter-company debt provided ResCap with additional separation from GMAC on a financing level, and, as a result, some participants are eyeing a ratings upgrade at the end of t

As a regular borrower, the Royal Bank of Scotland Group (RBS) aims to achieve capital diversification by currency, subordination and investor type and avoid over-reliance on any particular market. "Our capital raising philosophy is fundamentally linked to the group's objective of creating superior sustainable value for our investors through efficient management of our capital base," said Richard Harding, head of capital raising at the RBS group. RBS strives to meet investor demands through innov

The Republic of the Philippines has accumulated an unenviable debt burden over the past 20 years, since its transformation into a fully-fledged democracy. Since dictator Ferdinand Marcos fled the country in 1986 offshore bond market borrowing has increased steadily, from US$502m that year, reaching an average annual US$2bn in the 1990s and hitting US$8.2bn in 2002. Borrowing since then has averaged roughly US$4bn per annum with US$3.1bn targeted to be raised in 2006. Given this steady accumulati

Northern Rock has been a stalwart of the European securitisation market since 1999and has evolved into one of the world’s leading names in structured finance. In 1999 securitisation represented 3% of the bank’s stock funding and now its RMBS activity is such that it is the bank’s key funding tool, at between 40%-50%. Northern Rock has issued around 20 European ABS transactions to date, but a number of its most recent deals have been among its more notable. "We have recently launched several new

Created in March 2002 for the principal purpose of acquiring and owning Railtrack, Network Rail kicked off its initial funding programme in June 2002 by issuing a two-tranche bridging loan transaction through a consortium of nine banks. The £9bn loan was followed last year by the creation of a £4bn global commercial paper programme, which has about US$3bn equivalent outstanding. Prior to acquiring its government guarantee, the financing lines – which formerly included a £10bn MTN programme for N

Contrary to what Frank Czichowski, treasurer of KfW, described as a misconception, the agency's borrowing requirement has remained fairly static in recent years and is not expected to change dramatically based on initial projections for 2007. "We have no plans to change the overall composition of [our] funding requirement," he said, with respect to the breakdown of the core, non-core and private placements. That will mean that benchmark and public transactions will continue to make up around 40%

Local market forays continue to be a growing part the IDB's target markets for funding, with Peruvian pesos recently added into the mix. The bank's affiliate Inter-American Investment Corporation (IIC) is also following closely behind as it seeks to raise local currency to support small and medium-size businesses. The IDB has already raised US$2.5bn of the required US$6.2bn, which exceeds the US$4.9bn borrowed in 2005. To close the gap, the bank will stick to a well-established three-tier strate

Using the structured finance market to fund LBOs became increasingly popular last year. Toys R Us and Wyndham Hotels both issued mortgage-backed deals to help to fund their LBOs. While these deals were secured by the substantial real estate holdings of the issuers, Hertz, the largest on-airport car rental company in the world, used its huge rental car fleet as collateral. The Hertz transaction retained the roughly equal split in bonds, loans and equity that is typical of LBOs on the portion of t

To back its €29.1bn surprise and – as of June 15 – unaccepted bid for Spanish utility Endesa, E.ON mandated HSBC, Citigroup, Deutsche Bank and JP Morgan to arrange a €32bn loan. The deal was underwritten on an unequal basis, with HSBC believed to have taken a €11.5bn underwrite. As the largest loan from a European borrower to date, the loan smashed the previous record held by France Telecom, a €30bn facility that funded the acquisition of Orange back in 2000. E.ON's cash bid values the target at

DP World's takeover of UK ports group P&O was not easy. The group initially agreed the acquisition at the end of 2005, but Singapore's PSA trumped the state-backed group's 443p per-share bid with a 470p offer valuing P&O at £3.53bn. DP World countered with a knockout 520p a-share bid, valuing P&O at £3.92bn. The takeover was the group's second major overseas raid having acquired the international assets of CSX Corp a year previously. Unlike the CSX deal, the P&O acquisition proved politically pr

Citigroup issued US$24bn in debt in 2005, US$13.4bn in US dollars and US$10.6bn in other currencies, via 37 issues. This year, the bank is developing its franchises in Australia, Canada, Mexico and New Zealand, and various parts of Asia, in order to increase its borrowings. Citigroup has issued US$6.6bn in unsecured debt so far this year, on track to match the US$12.25bn it issued in 2005. In the secured markets, Citigroup has issued US$10bn in credit card ABS and US$4.3bn in student loan ABS. "

Since May last year, the Bakrie family or their companies have borrowed at least US$2.1bn in 12 separate deals. Investment bankers say the total amount of borrowing has probably been much more because many of the financings are discrete private placements. Indeed, of the 12 deals done in the last year, only four were public transactions. The family’s preference for private placements stems from a number of factors. The first is that the family and their affiliates are off limits for many banks b

Development banks are often in an unenviable position when it comes to issuing bonds. If they launch securities in developing economies, it is not enough for them to simply raise cost-effective funds. They need to ensure their paper makes a contribution to the evolution of local debt capital markets as well. But officials from the Asian Development Bank (ADB) are used to shouldering this burden and have been working hard over the last year to strike a balance between value funding and helping lo

When the year began, European lenders were convinced that 2006 was going to be the best year in a long time, and a look at this year's high profile acquisition deals shows that there is some truth to this. Deals like E.ON's €32bn loan backing its bid for Spain's Endesa, Mittal Steel's €10.2bn facility supporting its hostile bid for Arcelor, DP World's US$6.8bn loan for its P&O buy and Xstrata's US$8.5bn loan funding its hostile bid for Falconbridge show just to what extent M&A has return

Any decision on the classification of hybrid securities appears to be in a holding pattern, potentially adding to the kink in underwriters' revenue projections. There has been some communication between the NAIC, insurance investors and underwriters, though. At a mid-June meeting, the NAIC passed a proposal indicating that it will wait to make a decision on a hybrid classification action until September. However, that meeting did shed some light on what the market may be contending with when the

The first five months of 2006 delivered US$753bn equivalent of M&A announcements involving European companies – double the figure seen in 2005. And at US$443bn equivalent, the first quarter represented the highest quarterly volume for six years. Some of that has already translated into bond transactions. M&A has been one of the major drivers behind a big jump in corporate new-issue volumes in the first few months of the year. By the beginning of June, corporates had issued more than €74b