A SUPPLEMENT TO EUROMONEY - MARKETS 1997With the introduction of the single European currency less than two years away, borrowers and intermediaries in the international debt capital markets will focus more and more on this huge impending change. "This year and next are very major turning points that will shape the capital markets for 10 or 15 years to come. One is hard pressed to think of a more important development over the last 20 years than the euro," says Carlos Cordeiro, managing director at Goldman Sachs. Within Europe, the old national capital markets will be replaced by one huge domestic European market. How this will operate, no-one is yet sure. But participants are already trying to anticipate its workings witness Austria's euro-French franc bond deal in January which can be re-denominated into euros when Austria's own domestic schilling bunds become euro-denominated. It is essentially an attempt by Austria to win over a French institutional following for its domestic debt, in advance of the single currency. Other major borrowers may be tempted to establish their credit spreads in major European markets, to establish themselves with new investors. |