Almost non-existent a decade ago, Peru’s capital markets have flourished over the past five years, with the government and big companies such as US copper miner Phelps Dodge finding ample demand for bonds. Now the new government of president Alan García, which took office on July 28, aims to develop the markets further. There are plans to allow smaller companies to raise cash, develop a secondary mortgage market to unleash new funds to redevelop slums, and encourage pension funds to invest in productive industries, not just in sovereign bonds. “Deepening the local market in soles is going to be one of the pillars of our economic policy,” says García’s chief economic aide, Enrique Cornejo. “Our resources aren’t being put to work via the markets.” The barriers to smaller Peruvian businesses are daunting. Because many companies cannot meet the listing requirements of the Bolsa de Valores de Lima, Peru has launched only four initial public offerings with a total value of $40 million in the past 15 years, despite strong economic growth. The business sector is severely undercapitalized, with a total of $7.5 billion in debts, or around 10% of Peru’s GDP. A change in that situation is crucial to Peru’s long-term development, as small and medium-size companies generate 40% of GDP and three-quarters of all jobs in the country. However, these companies’ financing costs are up to 2.5 times those of big corporations.

HSBC becomes the first private banking client to sign up to SEI’s global wealth service. SEI has spent three years developing front-to-back-office products and services to aid wealth managers and individual high-net-worth clients.

Outstanding achievement award: Tan Sri Dato’ Sri Dr Teh Hong Piow, Public Bank, Malaysia

“Bond of the South”

Argentine banks’ holdings of public debt are to be restricted to a maximum of 35% of their assets, the central bank has announced. The measure aims to reverse the crowding-out effect by inducing banks to focus on private investment. “This provides additional degrees of freedom to conduct monetary policy, increasing the systemic independence from treasury needs and minimizing the ‘fiscal dominance’ that historically characterized our economy,” says Martin Redrado, Argentina’s central bank governor.

Lebanon has announced plans to borrow as much as $7 billion by the end of this year as it struggles to reduce interest costs on its debt. According to Moody’s Investors Service, Lebanon’s gross debt had reached 727% of government revenue by the end of 2005, the highest level of any rated country.

Following the recent appointment of Robert Taylor as CEO, Kleinwort Benson Private Bank and Kleinwort Benson Channel Islands are amalgamating and will become known simply as Kleinwort Benson. The bank has also begun an expansion of its regional office network in the UK.

Critics of Goldman Sachs enjoy accusing the firm of being a hedge fund. But such accusations look wide of the mark given that Goldman’s Asia’s equity guru, Hyder Ahmad, has just quit to start his own fund.

When asked what vexes him most in his dealings with investment bankers, Fabio Barbosa, CFO of Brazilian mining company Companhia Vale do Rio Doce (CVRD), takes a few moments to think. He is certainly in a good position to offer an opinion. His company’s $1 billion 2016 bond was the largest ever Brazilian corporate issuance in the global capital markets; it has been able to issue cheaper debt than the sovereign; it comes to market regularly and leverages its global reputation and investment-grade rating to achieve extremely aggressive pricing on its bonds.

One year on from its prototype of efunding, Ekportfinans has launched the full version of its electronic funding platform, an innovative approach by the Norwegian export financing agency to operating its structured medium term note funding operation.

“As you can see, we’re keeping our operating expenses down,” jokes Nigel Harris, CEO of New Philanthropy Capital, as he ushers Euromoney into a cramped and bare meeting room in its LondonBridge office. It’s probably a far cry from the plush quarters to which he was accustomed in his investment banking days at Schroders but such frugality seems appropriate to his new role at a firm that seeks to galvanize the charitable sector. By providing detailed analysis of charities to donors, New Philanthropy Capital hopes to help them direct their money where it will be best used. “We want money to be better allocated,” says Martin Brookes, head of research, “and then hopefully the realization that this is happening will encourage more people to give.”

SpencerLake has joined HSBC as global head of debt capital markets after 17 years at Merrill Lynch. Lake had only recently been appointed to a newly created role of head of debt capital markets for the Asia-Pacific region at Merrill. He will be based in London and manage HSBC’s 250-strong origination team. He reports to Daniel Palmer, head of global capital markets.

Do the US capital markets require rating agencies to continue to be regulated? It’s a question raised by legislation recently passed by the US House of Representatives and working its way to the Senate.

Acquisition financing can always run into difficulties, as Axa found out to its cost last month when it printed its €2.25 billion equivalent hybrid debt deal at the high-water mark of volatility. The deal, which financed the purchase of Winterthur from Credit Suisse, was adversely affected by weak equity markets, high hybrid supply and by a surprise announcement by Generali that it would borrow an addition €1.2 billion of hybrid for an acquisition.

Building materials company Lafarge has become the first French issuer to issue an SEC-registered deal for five years. But despite the ease with which it did this it seems unlikely many will follow its example.

Dresdner Kleinwort Wasserstein is having a clear-out to make way for the thoroughly modern and revamped Dresdner Kleinwort. In preparation for its facelift, the firm is auctioning off to staff the antique artwork and furniture that adorned its Swan Lane office in London. The George III décor was not in keeping with the new office in Gresham Street, which instead has a Williams F1 racing car in the lobby.

German SME CLO deals continue to appear, despite disagreement on how these risks should be assessed.

Henderson Global Investors wants to be taken more seriously in the hedge fund market. The firm launched its first hedge fund in 1999 – a global tech long/short fund – and now runs $2.5 billion in 15 funds. To build the business further, Henderson has been recruiting distribution talent from hedge funds and is ready to attack the US market.

The Squadra Azzura won the World Cup last month after a shaky start and by steadily improving their performance. It’s a stark contrast to the development of the Italian hedge fund industry. Italy rode the wave of hedge fund expansion by introducing regulation as early as 1999. As a result, growth has been strong. Italian funds now manage €18.3 billion, more than 5% of total hedge fund assets invested in Europe.

In a motion filed with a US bankruptcy court at the end of June, Refco announced that it had entered into an agreement to sell its retail FX business, including customer account information and related assets, to Gain Capital Group. Both parties announced that, under the proposed terms of the deal, Refco FX’s clients could recover up to 100% of their currently frozen account balances.

EFG Private Bank has bought English traditional private client stockbroker Harris Allday, adding £2 billion in assets under management for the UK and Channel Islands. Harris Allday’s 27 client relationship officers will be absorbed into EFG but will trade as EFG Harris Allday.

A week is a long time in politics; a month in European CMBS can bring an almost complete reversal of sentiment. The €10 billion of supply in July took everyone by surprise

Despite grumblings from hedge fund managers about the way they are treated by the media, a survey by Horizon Cash Management shows that not all of them are unhappy with the coverage. Forty seven percent of hedge fund managers surveyed considered press coverage of the sector to be unfair, but 46% thought it was pretty neutral.

Michael Jinn, co-head of European CDO structuring and head of securitization coverage for Portugal at Deutsche Bank, has left the bank to rejoin his old boss, Michael Raynes, at Citigroup. Raynes, who was global co-head of the securitized products group and global head of CDOs at the German bank, surprised the market by jumping ship to Citi earlier this year. He is likely to raid his old Deutsche team for further staff in the future.

Emerging market CDOs look more attractive after the recent market correction.

Results from the fourth semi-annual surveys of foreign exchange volume, published simultaneously by the US Foreign Exchange Committee (FXC) and UK Foreign Exchange Joint Standing Committee (JSC), show that the market is continuing to expand strongly.

Our congratulations to Elaine Bridge, a PA at HBOS Treasury Services in London, who won the prize draw for participants in our revamped Business Travel poll (go to page 85 to see what investment bankers consider the best hotels, airlines and restaurants in the world).

Complacency can lead to extinction according to Goldman Sachs’s key principles. The extent to which its bankers take that tenet to heart was amply demonstrated at Euromoney’s inaugural Asia Awards for Excellence in July [see Asia awards 2006 for more on the event]. As guests arrived for the pre-dinner cocktail reception, one sharp-eyed Goldman banker spotted an unfamiliar but evidently important dignitary entering the room, accompanied by an impressive entourage of aides and hangers-on.

Reuters and the Chicago Mercantile Exchange have announced the financial institutions that have confirmed their intention of participating in their joint venture, FXMarketSpace’s Early Adopter Program.

We mentioned earlier this year how Marcus Browning, former co-head of FX trading at Merrill Lynch, had engineered a move to Citi, purely, if rumours are to be believed, to get some sustained training for this year’s Etape du Tour. Unfortunately, Browning failed again this year to get the gold standard handed out to high finishers in the event. Having finished a splendid 820th out of more than 7,500 starters, Browning has every right to feel slightly aggrieved.