Bankless capital raising? Don’t bet on it

New technologies are marching into the securities issuance process. This week came bids to shake up two very different kinds of private debt — traditional corporate Schuldscheine and funky structured notes.

  • By Jon Hay
  • 22 Mar 2018
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Cartoon_1547_BankerA little unusually these days, the Schuldschein innovation does not involve blockchain. Refreshingly, Helaba is using a conventional online platform for its effort to cut the cost of Schuldschein issuance by 40%.

The scheme is no less interesting or radical for that. Helaba thinks centralising the whole process on a multi-dealer system could make the market faster, simpler and more efficient. Great for small issuers in particular.

Meanwhile, Marex Spectron, the London commodities broker, has issued two month structured notes on the Ethereum blockchain, using Nivaura technology. A parallel issue, conventionally settled, is meant to demonstrate the blockchain route is cheaper and faster.

Marex did not use a bank at all. If Helaba’s omniperfect system gets going, will Schuldschein issuers need banks to find investors — who will all be logging in daily?

Tech certainly means dealers are no longer so crucial to connecting issuers and buyers.

That need not make them redundant. In the Schuldschein market, investors getting small tickets cannot afford the time to keep analysing new credits. They trust the banks to bring borrowers they know and trust of old. The banks provide research and the investors trust it.

Marex may not be a bank, but it is a futures broker. It has specialist skills at finding customers that want certain risk exposures, constructing those exposures with derivatives, and hedging the risk.

Banks and brokers may lose their edge as plumbers as tech takes over, but they are still needed for many higher value jobs in capital markets.

  • By Jon Hay
  • 22 Mar 2018

All Corporate Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 JPMorgan 75,347.35 359 5.91%
2 Bank of America Merrill Lynch 74,239.03 342 5.83%
3 Citi 62,167.71 351 4.88%
4 Barclays 58,729.13 218 4.61%
5 Goldman Sachs 50,207.03 203 3.94%

Bookrunners of Euro Denominated Corporate IG Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 BNP Paribas 18,740.11 80 9.75%
2 SG Corporate & Investment Banking 13,968.96 63 7.27%
3 Deutsche Bank 12,777.94 56 6.65%
4 UniCredit 10,968.94 48 5.71%
5 HSBC 10,482.96 60 5.46%

Bookrunners of European HY Bonds

Rank Lead Manager Amount €m No of issues Share %
  • Last updated
  • Today
1 BNP Paribas 3,647.43 42 7.27%
2 JPMorgan 3,279.22 34 6.53%
3 Deutsche Bank 3,153.00 28 6.28%
4 Credit Suisse 2,939.41 27 5.86%
5 Goldman Sachs 2,892.87 27 5.76%

Bookrunners of Dollar Denominated HY Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 JPMorgan 13,575.71 111 9.62%
2 Citi 10,815.50 91 7.67%
3 Goldman Sachs 9,536.47 76 6.76%
4 Bank of America Merrill Lynch 9,455.18 88 6.70%
5 Barclays 9,449.01 71 6.70%

Bookrunners of European Corporate IG Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 BNP Paribas 19,622.23 78 6.66%
2 Barclays 17,915.82 53 6.08%
3 HSBC 17,859.84 77 6.06%
4 Citi 15,926.05 64 5.40%
5 JPMorgan 15,445.30 54 5.24%