Despite expectations that the European market would become increasingly independent from the US market, the European high-yield sector is still intimately bound to the US.
The close ties became more evident over the summer, as the knock-on effects of US interest-rate volatility wreaked havoc on European market sentiment. This is predominantly because European deals still heavily rely on US buyers.
Also the banks that lead-manage the deals in the European high-yield market are predominantly American. Although the European high-yield teams at the US banks are keen to establish their own turf and notch up their own landmark deals, they still have to report in daily to their New York offices.
"We are a stand-alone entity, but we are joined at the hip with our US team for many reasons," says Astier of Lehman Brothers' European high-yield team of 30 professionals.
Banks need their US offices for distribution of paper to US investors, but New York also has the last word on European origination and can ultimately veto deals. Many banks stress that their high-yield teams co-operate on a global basis, but this is merely a euphemism for US control on a global basis.