Most Impressive Bank for Middle Eastern Bonds — Standard Chartered
The Middle Eastern international bond market once again demonstrated its resilience over the past year with a diverse array of issuers pushing volumes well above $100bn. Standard Chartered’s client-centric approach brought success in products ranging from ESG to bank capital, and from debut transactions for corporates to repeat business for the largest sovereigns.
“Despite the challenging backdrop, the MENA region continues to outperform both in terms of overall volumes as well as robust investor sponsorship globally,” says Salman Ansari, head of capital markets west, covering MENA, Europe and the Americas. “One theme that best encapsulates the capital markets activity in our region is that of remarkable resilience against macro headwinds.”
Standard Chartered has dominated the sovereigns, FIG and corporates league tables during this time, which Ansari puts down to the bank’s client-centric approach.
“Client needs are at front and centre of everything we do,” he says. “Based on their key strategic and financing objectives, we ensure to consistently deliver and outperform issuer expectations by leveraging our leading credit markets platform.”
It helps that, for Standard Chartered, the region is a cornerstone of its global capital markets franchise. “The MENA region is a key footprint market for us,” says Ansari. “From a capital markets perspective, we have been here since beginning. Driven by the principles of investor diversification as well as innovation, we have played a leading role towards the phenomenal growth of this region from under $10 bn of issuance volumes annually to $100 bn plus, today.”
Tying the business together is the London-based syndicate team, which is particularly active in introducing Gulf Cooperation Council credits to Asian investors, says Hussain Zaidi, head of bond syndicate, west.
“For many years now, Standard Chartered has been the first point of call for most international investors across Asia, Europe and the US when they consider GCC fixed income instruments across the capital structure, especially in ESG format”, says Zaidi.
The last year has been particularly notable for the rise of ESG bonds, a market that is of crucial importance in a region as commodity-based as the Middle East.
“This is the region that can drive the greatest change through green and transition instruments,” says Sarmad Mirza, head of corporate debt capital markets, MENA.
Sovereigns have been driving the ESG agenda through government related entities, with deals such as the $600m Sukuk issued by Etihad Airways in October 2020, blazing a trail for others to follow. That deal, on which Standard Chartered acted as joint structuring advisor and joint bookrunner, was the first sustainability-linked financing for the aviation sector globally and the first transition sukuk ever executed.
“We’ve opened the door with the successful issuance of that landmark transaction, and by showing that it can receive a very positive market reception it has given a lot more confidence to other issuers in the region and will undoubtedly usher in new ESG opportunities for a broad range of sectors,” says Mirza.
Standard Chartered’s success in FIG — where, for instance, it has been a bookrunner on 33 out of 40 additional tier 1 (AT1) transactions from the region since the first deal in 2012 — comes from its focus on the overall funding needs of issuers, says Ali Ahmad, head of FIG capital markets for Africa and the Middle East.
“We don’t look at our business on a deal-to-deal basis but work to meet our clients’ holistic funding objectives,” he says. “We accordingly structure solutions that meet their short and long-term funding needs and maintain a very close partnership with them so that when, for instance, when the swap rate on a particular currency moves in their favour we can call them at 6am in the morning and show them an intraday opportunity that makes a lot of sense.”
Examples of such deals include renminbi (CNH) deals for Emirates NBD, First Abu Dhabi Bank, Qatar National Bank, callable Formosa’s and a euro for First Abu Dhabi Bank. “Each of these deals priced inside or at the issuer’s US dollar curve while giving them access to a new set of investors away from the traditional public US dollar market” said Ahmad.
In the sovereign space, too, Standard Chartered continues to win mandates from the largest and most prestigious issuers.
“Across the GCC, I think we distinguish ourselves in terms of consistently outperforming issuer expectations by delivering broad-based investor diversification,” says Ansari. “Whether it’s a first time borrower, or an issuer embarking on an innovative transaction, or a repeat borrower seeking to navigate markets against a choppy market backdrop, we are fortunate to be the trusted advisor for our clients time and time again.”