Comment - All Articles

  • The end of the road for roadshows

    The shock of the Covid-19 coronavirus outbreak has forced some rapid thinking among capital markets participants. Almost the first impact has been on travel.

    • 27 Feb 2020
  • Covid-19 threatens more than the global economy

    Market participants should be braced for political volatility as the world comes close to experiencing a pandemic.

    • 27 Feb 2020
  • UBS goes for ‘one firm’ approach to improve IB

    Sergio Ermotti’s call for improvement in UBS’s investment bank could be undermined by the arrival of his successor as chief executive, writes David Rothnie.

    • 27 Feb 2020
  • Breaking: woman has meeting

    “What's in a name?” wrote Shakespeare. “That which we call a rose by any other name would smell as sweet.” A banker tried applying a similar philosophy last week. It wasn’t quite so poetic.

    • 27 Feb 2020
  • EU MREL: too complicated by half

    The Single Resolution Board is planning to add another level of intricacy to the minimum requirement for own funds and eligible liabilities (MREL), just as it seemed as though they couldn’t get any more complicated.

    • 25 Feb 2020
  • The show should still be on the road

    The emerging markets bond business, like much of the rest of the primary markets, hit a stumbling block this week due to the spread of the Covid-19 coronavirus. But even if no deals print, delaying the marketing of deals does not make sense. Roadshows should be rolling on — as Belarus is doing — even if deal printing pauses.

    • 25 Feb 2020
  • Coronavirus no match so far for ECB in corporate bonds

    The Covid-19 coronavirus outbreak has become prevalent enough in Italy to lead to a quarantine of around 10 towns. But this still doesn't appear to be enough to derail the motoring primary corporate bond market. There is plenty of justification to think that robust market conditions will last a while longer.

    • 25 Feb 2020
  • Bond investors are playing with fire

    Asia’s bond market has had an undeniably stellar start to 2020. Despite the spread of the novel coronavirus, now named Covid-19, investors are continuing to buy bonds at remarkably tight prices as issuance accelerates. But the non-stop enthusiasm raises a serious question — are market participants too positive?

    • 24 Feb 2020
  • ECB is revving the engine but the handbrake is on

    Europe’s capital markets are back in super-demand mode.

    • 20 Feb 2020
  • HSBC’s restructuring: is it enough though?

    HSBC’s corporate finance staff have survived its restructuring largely unscathed, but the more ambitious among them will see the bank’s plans as a missed opportunity, writes David Rothnie. And with no answer yet on the identity of the next full-time CEO, the uncertainty is not over.

    • 20 Feb 2020
  • EBRD: futureproofing Sonia

    The European Bank for Reconstruction and Development made a bold move this week by rewriting the rulebook for how coupons of Sonia-linked floating rate notes should be structured. It annoyed some, but it’s hard to argue against the logic.

    • 20 Feb 2020
  • When you gotta go, you gotta go crazy

    The spread of the coronavirus led to a farcical robbery this week. Call it the lighter side of social breakdown.

    • 20 Feb 2020
  • STS is burden enough without shoehorning in ESG criteria

    With the environmental, social and governance revolution well under way, attention has turned to the securitization market after recent deals pushed the issue to the top of the agenda. There has been talk of retrofitting the ‘simple, transparent and standardised’ (STS) regulatory framework with a ‘green’ or ‘ESG’ category, but regulators should think twice before conflating both themes.

    • 18 Feb 2020
  • Sustainability a far cry from the fusty world of US PPs

    Several chances to demonstrate commitment to corporate sustainability have occurred in the US private placement market recently, and the market has fallen short in almost every case. Most of the PP market is as unfamiliar with using the term 'ESG' as it is to yelling 'YOLO'.

    • 18 Feb 2020
  • Equity markets should brace for worse to come after Apple’s coronavirus warning

    Apple’s announcement that it is likely to miss revenue estimates for the first quarter of 2020 should serve as a warning to equity investors that the economic effects of the coronavirus outbreak should be feared alongside any threat of it becoming a pandemic.

    • 18 Feb 2020
  • Local bonds for local people

    By opening up its debut social bond to retail investors, Munich highlighted an often overlooked strength of the socially responsible investment (SRI) market. Distributed correctly, these funding tools demonstrate the true impact of ethical investing.

    • 18 Feb 2020
  • Hiding the impact of IFRS 16 is of no benefit to anyone

    Some of the more creative souls in corporate debt markets are trying to find ways to gloss over the impact of the IFRS 16 accounting standard. Brought in a year ago, it has driven up some firms’ leverage ratios by forcing them to report leases on their balance sheets, even though their businesses have not changed. But it would be a bad idea to act as if the rules had never changed.

    • 18 Feb 2020
  • Trans Retail loan: right call on staggered fees

    Trans Retail Indonesia has caused a stir by deciding to structure its new syndicated loan with a relatively rare two-stage participation fee payment. Although not all banks will be wholeheartedly on board, the borrower’s move is savvy under the circumstances.

    • 18 Feb 2020
  • Oil and gas's tobacco moment

    Polite society does not tolerate smokers the way it used to. What was once a ubiquitous habit is now banished to outdoors in many countries. Tobacco investment is a rarer beast too these days, reflecting how deeply ethical preferences can affect capital markets. Now oil and gas securities could be about to face a similar shift.

    • 13 Feb 2020
  • AT1 success for DB but shareholders will have to wait

    Deutsche Bank’s ability to issue a new additional tier one bond illustrates the lesson of investing in European banks over recent years: bet on bonds, not equity.

    • 13 Feb 2020
  • Argentina’s ambitious timeline should buoy investors

    Argentina's plans to restructure $67bn of debt in under two months may look naive to some but the ambition the government has so far demonstrated point towards a good outcome.

    • 13 Feb 2020
  • The UK is still not taking its financial services industry seriously

    Negotiations may involve a degree of posturing, but as demonstrated with the plan to demand “permanent equivalence” with the EU over financial regulation, it is not clear what future the UK government wants for one of its most important industries.

    • 13 Feb 2020
  • Banks jostle for position in sustainable M&A revolution

    Nomura has made sustainability one of the pillars of its fightback in investment banking, as it joins the race to harness the power of sustainability-related M&A and capital markets deals.

    • 13 Feb 2020
  • First class travel: no longer for the faint-hearted

    The coronavirus outbreak is already having an impact on my jet-setting retirement lifestyle. I suppose I shouldn’t complain ─ but I will.

    • 13 Feb 2020
  • Coronavirus bonds: China must be vigilant

    Chinese regulators will have to strike a balance between supporting the use of the domestic bond market to help combat the deadly outbreak of the coronavirus, now officially known as Covid-19, and preventing the misuse of it.

    • 13 Feb 2020
  • Philippines ECM: finally, some good news

    A recent move to encourage Philippine property companies to sell real estate investment trusts (Reits) looks set to give a much-needed boost to the market. The country has long suffered from a paucity of deals. It may finally be ready to turn a corner.

    • 12 Feb 2020
  • FIG bonds: pessimism has been banned

    The yields on bank bonds have reached their lowest ever levels in recent weeks, thanks to meagre issuance and accommodative central bank policy. These conditions mean investors can see the silver linings, but not the clouds — and there are plenty — behind them.

    • 11 Feb 2020
  • Sustainability: more stick, less carrot

    Sustainable finance players are enthusiastic about regulation, which they expect to bring clarity and order to the market. It may — though when the new EU rules are implemented they are likely to irk participants more than they expect. But what would be really effective are direct actions that bypass finance.

    • 11 Feb 2020
  • Argentina restructuring timeline is far-fetched but a reason to cheer

    Argentina's plans to restructure $67bn of debt in under two month may look naive to some but the ambition and good communication the government has so far demonstrated point towards a good outcome.

    • 11 Feb 2020
  • Hybrids have become a savvy corporate treasurer's dream structure

    Hybrid capital bonds are the flavour of the month. Their roaring success this week and the absence of any clear event that will knock them off their perch means they will quite likely prove the flavour of the year.

    • 11 Feb 2020
  • Goldman’s growth plan faces Europe test

    As Goldman Sachs hunts for incremental gains in its investment banking division, it need look no further than its European franchise, where it continues to trail JP Morgan, writes David Rothnie.

    • 06 Feb 2020
  • AT1s: waiting could be worth it

    Conditions for issuance in the additional tier one market may be more attractive than ever, but there’s still good reason for some bank treasury teams to bide their time.

    • 06 Feb 2020
  • Lunching during tricky times

    As the coronavirus rages on across mainland China, simple daily tasks can morph into a whole new way of doing things.

    • 06 Feb 2020
  • Ultra-long makes sense for EM sovereigns

    Long duration bonds, such as Ghana’s 40 year tranche sold this week, are a great idea for African issuers, leaving the borrower’s ability to manage its debt in its own hands rather than at the whims of the market.

    • 05 Feb 2020
  • Equity market should fear coronavirus threat to China GDP

    A fall in equity markets last week reflected an automatic reaction to the possibility of a new global pandemic. But the more substantial effect of the coronavirus outbreak on equities may be reflected in economic performance, rather than the rate of contagion.

    • 04 Feb 2020
  • EM investors sticking to their silver linings playbook

    If the US assassination of an Iranian general and the coronavirus outbreak cannot derail emerging market bonds, then what will? Not much, it seems, Perhaps not even the likely disruption of Donald Trump’s run for re-election this year. Technical factors supporting demand are so strong that investors are blinded by the silver linings surrounding every dark cloud on their horizons.

    • 04 Feb 2020
  • Coronavirus will not undermine Asian markets

    The outbreak of the novel coronavirus in China is taking its toll on Asia's capital markets. Many countries have acted quickly to contain the disease as much as possible, leaving investors, bankers and companies with capital market ambitions in limbo, with many forced to cancel travel plans and work from home. The outbreak shows no signs of abating — but it may not mar the capital markets for long.

    • 04 Feb 2020