Emerging Europe

Key numbers from the equity capital markets in 2008 include $257.4 billion, the value of equity raised by financial sector issuers, accounting for 41% of total ECM volume of $634.4 billion. That’s up from just 11%, the financial sector’s share of new issues in 2007. In 2007, total global ECM volume was $943.7 billion

Why Rohner left UBS

Consolidation among investment banks has had a big impact on the equity capital markets league table results in 2008 and will do so again in 2009.

VTB, Russia’s second-biggest bank, announced worse-than-expected results for the third quarter after making a loss of $369 million following the doubling of its provisioning levels. Analysts at Nomura reckon that the biggest challenge facing VTB is that the equity capital of the bank declined by $1.5 billion in the third quarter alone. The bank’s chief financial officer has said that it needs to raise tier 1 capital and is hopeful that its minority shareholders will come to the rescue. In the third quarter, the bank’s capital adequacy ratio fell to 14% from 15.8%, although it’s still well above the Russian minimum level of 10%. The bank’s tier 1 ratio dropped to 12.7% from 14.4% in the second quarter.

Despite remaining a largely centrally planned economy, Belarus has not been immune to the fallout from the global credit crunch and the associated macroeconomic slowdown. At the beginning of the year the country was forced to devalue the Belarussian rouble by 20% to BR2,650 to the dollar and raise its key refinancing rate to 14% from 12%.

Russian fund group Da Vinci Capital Management has launched the marketing campaign for its latest investment vehicle. The CIS Private Sector Value Fund (PSVF) is designed to offer investors the chance to profit from the opportunities available in private equity in Russia and other members of the Commonwealth of Independent States.

The primary market share of the top 10 global debt houses declined substantially in 2008, according to full-year figures released last month by Dealogic.

The past year's best deals proved that investors were still receptive to a diverse range of issuers. This year will be different.

Be the first to see the results.

Investors are busy in the country’s many retail, residential and hotel development opportunities, but in one source of funding – nearby Greece – local real estate investment companies are keeping money closer to home. Philip Moore reports.

Global stock markets are at their cheapest for 25 years. Belated measures taken by the US authorities, and possible stimuli from the new Obama administration – and not forgetting a proper historical analysis – show rewards will come in 2009 for those brave enough to buy, writes Charles Dumas.

The credit crunch has spread to emerging Europe – despite what the region’s central bank governors may claim. They have taken action to bolster liquidity and shore up the banking sector. Chloe Hayward asked 14 monetary authority heads what more they can do to manage the inevitable downturn.

Kazakhstan has emerged as the principal conduit for South Korean investment in central Asia. Guy Norton reports from Almaty on the future for cooperation.

Full of value or close to collapse?

Agency brokers have returned to fixed income just as investment banks have withdrawn from the market. Will they be able to create dark pools of liquidity and repair the breach in the distribution of debt securities? And does their increasing power herald the return of the primacy of relationships?

Just two years after facing its previous financial crisis, Hungary is once again in trouble thanks to over-reliance on foreign markets. But it is not necessarily the banks that need saving. Jethro Wookey reports from Budapest.

In the past few months the Russian capital markets have been hit by a rush of selling as spooked investors head for the exit, sending valuations into free fall. Guy Norton reports from Moscow on what lies in store.

After enjoying years of plenty, the country’s investment banks are facing up to the prospect of leaner times ahead. Guy Norton reports from Moscow on how they are looking to survive the economic downturn.

Unlike most sovereign wealth funds, the State Oil Fund of Azerbaijan is still growing strongly and looking for more foreign risk. Will the country’s experience of the global downturn rob the international capital markets of a new hope? Dominic O’Neill reports from Baku.

The Future of Capital

The liquidity crisis has contributed to a dramatic change in the trading of fixed-income securities. A year ago the curtailment of the liquidity to investors could be written off as a temporary state of affairs that would be rectified as soon as market conditions got back to normal.

Kazakhstan’s bankers are taking a defiant stance towards the financial crisis. Despite the fact that important sectors of the economy such as banking and construction have been hit hard by the global credit crisis, which has cut off the supply of cheap foreign funding that backed their rapid expansion, investment bankers believe there is still plenty of potential business to be fought over.

The impact of the credit crunch has been far-reaching, with global property markets left severely damaged. What started off as a largely isolated problem of the US sub-prime mortgage market and some structured credit intensified and spread across the globe over the course of 2008. The repercussions will continue to impede business and thwart growth in property throughout 2009.

Otherwise the country faces a crisis akin to 1998.

The endless series of new index lows has repeatedly confounded investors who see equities as having become cheap again. The rally at the end of last year has raised hopes once more that valuations might have found a bottom. However, for some leading strategists, what looks like cheap today may not be cheap enough.

The decline in valuations in developed markets is causing some investors to take another look at opportunities in the US and UK but not necessarily at the expense of emerging market allocations.

The Eurasian Development Bank has admitted Belarus, Armenia and Tajikistan. According to the bank’s chairman, Igor Finogenov, the admission of new member states will enhance the wider geographic expansion of the bank’s investment activities. According to the founding documents of the bank – which was established in January 2006 by Kazakhstan and Russia – any country or international organization can apply for membership.