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Dude, where's my order book?


Bankers have not struggled when helping European governments sell debt lately. So it was a surprise to see a kerfuffle in this corner of the market last week, particularly as the deal in question was so well bid.

BBVA, Citi, HSBC, JP Morgan, Santander and Société Générale issued a €10bn 2031 bond for Spain with final order book of more than €55bn and a new issue premium of 1bp. However, what shocked many was more than €75bn of orders dropping out of the book after the final spread was released (it went from Bonos plus 8bp area to 4bp final pricing with no intermediate step).

A head of debt capital markets away from the deal called the huge drop in orders a “world record fail”, blaming “a lazy syndicate” for either not pushing back on the aggressive move, if it was the borrower’s suggestion, or for coming up with the idea themselves.

Spain’s argument for pricing at plus 4bp was that it felt it did not need to offer much of a new issue premium. The leads were quick to reassure onlookers that most of the orders that were lost were low quality froth anyway.

Having not been privy to the order book, Notebook cannot say for sure who dropped out and who had inflated their order but it is certainly worth considering that the ECB shares some blame for this situation.

Away from the markets, NatWest Group and Natixis have refreshed their investment bank leadership teams.

NatWest Markets has made three positions permanent, subject to regulatory approval. Last summer, the bank made Jonathan Peberdy head of capital markets, Ian Donaldson head of customer sales and Simon Manwaring co-head of trading on an interim basis, and it has decided to stick with the trio. Not keeping his title is David Henness, who was the other interim co-head of trading. He will continue to lead fixed income trading.

Natixis's corporate and investment banking division played host to a game of musical chairs. Alain Gallois is both the new global head of coverage and the new head of Europe, the Middle East and Africa, excluding France.

Stephane About was previously chief executive of the CIB for EMEA excluding France, but as Notebook reported last week has moved to become chief executive of Société Générale Americas.

The previous heads of coverage were Guillaume de Saint-Seine and Damien Cléris. They now have newly created roles reporting to Gallois, as global head of financial institutions and head of business development with corporates and the Groupe BPCE networks respectively.

Gallois had been appointed global head of investment banking under a year ago; Fabrice Croppi succeeds him.

Meanwhile, Michael Haize becomes global head of global markets — Mohamed Kallala was previously head of global markets but recently became co-head of corporate and investment banking.

Two jobs ago, Haize was global head of debt capital markets. He was replaced by Gabriel Levy, and Levy's team now has some new leaders as well.

Thibault Archeray and Caroline Bryant are now co-heads of the financial institutions DCM franchise. And Thomas Leocadio has been promoted to co-head the sovereign, supranational and agency DCM franchise alongside Emmanuel Smiecench, who is also responsible for SSA syndication.

Finally, former Barclays banker Richard Boath has joined capital markets start-up Agora, founded by fellow alumnus of the firm Charlie Berman.

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