Euro Bond House and Covered Bond House: Credit Agricole CIB

IFR Awards 2023
5 min read
Philip Wright, Malicka Danna Sielinou

Momentum gathered

Success requires hard work: lots of it, often over many years and sometimes seemingly in vain. But commitment is key, because when they come, the rewards are usually well worth it. Credit Agricole CIB is IFR’s Euro Bond House and Covered Bond House of the Year.

Momentum is defined as the product of mass and velocity, something that aptly sums up Credit Agricole CIB’s successes across markets in 2023. Such achievements do not merely arrive overnight, however, and the bank embarked on a long and patient journey to ensure it attained them in a sustainable way.

While not absent from conversations when it came to mandate awards before, CACIB built up its reputation over the years to such a degree that 2023 saw it firmly seated at the top table across myriad asset classes.

The withdrawal of support from the European Central Bank and volatile interest rates made for a tricky backdrop to a bond market that required careful navigation. For CACIB, this was nowhere better exemplified than in the covered bond sector, where it bucked the trend seen by many of its competitors and actually grew its market share – jumping three places in the league table to second in the process.

“We saw the largest investor across asset classes [the ECB] pretty much vanish,” said CACIB’s Atul Sodhi, global head of DCM. “The job of the mandated banks is to make sure that despite that absence you assure the issuer of a successful trade, and that takes a lot more connection with the investors to make sure that notwithstanding the volatility they will come in size and make the trades successful.”

Armed with an astute market read, CACIB was able to spearhead reopenings such as that of the Italian Obbligazioni Bancarie Garantite sector by UniCredit in June, assist issuers such as Arkea and Eika navigate the long end of the curve (having tested the waters with a covered bond of its own via the SFH entity), create a path for smaller and rarer issuers to tap the market in a context where investors had their sights firmly set on top-tier names, and play a part in the expanding presence of ESG-labelled instruments in the covered bond space.

A late-year example of how CACIB’s insightful grasp of the market informed its approach to advisory and execution was November’s €1.25bn five-year for DNB Boligkreditt.

“We started 1bp wider of where the secondary was trading and still gathered more than a €2bn book because we knew of DNB-specific factors. They had not come to the market for two years and that explained why it should not have been too much back of where Nordea had just printed their trade,” said Andre Bonnal, on the fixed-income syndicated desk.

“Nowadays, especially when you see that the market is repricing, it is very easy for a syndicate to just look at the secondary market and add x number of new issue premium, but this simply doesn’t work anymore. We have the intel and we have the experience to see that and detach ourselves from secondary and focus more on a relative value scheme instead.”

In the broader FIG arena, CACIB also increased its presence in the euro market and was active for national champions, domestic players and insurance companies across the senior and subordinated sectors. In the latter, a dedicated team of solutions and advisory professionals made for a number of mandates across the Additional Tier 1 and Tier 2 asset classes for the likes of Bankinter, AXA, Novobanca, Sabadell and its own parent, CASA.

“In those cases, the client is giving you the keys and saying you’re driving; no one else is in the driving seat,” said Sodhi.

And this responsibility was echoed in the corporate market, notably on Siemens’ €2.5bn duration-lengthening triple-tranche transaction across 8.5, 13 and 20-year tenors in February, where the bank was sole global coordinator.

“It’s the most diligent company when it comes to doing deals,” said Dominik Boskamp, head of corporate DCM for Germany and Austria. “There was a month of preparation work; they didn’t leave anything to chance.”

A slew of deals ensued, many of them multi-tranche, such as Kering, Enel or Eni, while others were notable for other reasons, such as Porsche (unrated) or Unibail-Rodamco-Westfield (exchange offer). Some were green, some sustainability-linked, some senior, some hybrid.

And the story was the same in the public sector, where the bank complemented its perennial strong showing in its domestic market and the ESG arena with a broad reach across the Continent and a particularly noteworthy roster in Spain. Here, regional mandates flowed through to agencies and culminated in the sovereign, where CACIB was involved in two of the more eye-catching deals of the year, the kingdom’s €13bn 10-year transactions issued in January and June.

At the other end of the scale, the bank demonstrated its dexterity and market nous with multiple private placements.

“You have to be able to read the opportunity, be willing to take the risk and distribute over time,” said Toby Croasdell, global head of MTNs, private placements and commercial paper.

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