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Portugal online: Banking on reform

Barclays Capital has expanded its electronic trading platform to offer secondary market liquidity in all the bank’s equity structured note offerings.

Asia’s private banking ranks continue to swell as a benign market lures in more entrants. Costs are escalating and so is product pricing. Market growth may yet hide banks’ hubris but any reversal in trends could leave some dangerously exposed. Chris Leahy reports.

Euromoney congratulates those that have won this year, and challenges those that came close to make our decisions even harder in 2007.

Little-known London-based Cheviot Asset Management has poached 50 investment management professionals from UBS and other leading investment firms as it relaunches itself as an independent private client asset management group.

Are the much-hyped credit derivative product companies now lining up to launch relying on an arbitrage that is dangerously close to disappearing?

The European Investment Bank has launched a new bond targeted at retail investors that can be sold in all 12 countries in the eurozone. Called eurozone public offering of securities (Epos) the security uses the passporting mechanism that the EU’s prospectus directive introduced last June. The €1 billion 10-year bond is lead managed by Merrill Lynch with a 12-strong syndicate of retail banks – one for each eurozone country. The deal is listed in Luxembourg. It is a lightly structured transaction, offering 5% in the first year and then a multiple of the HICP measure of inflation.

The recent popularity of bank balance sheet CLOs, ushered in by ABN Amro, HSBC and Barclays Capital at the end of last year, shows no sign of abating. In June alone, RBS, Deutsche Bank, BNP Paribas, Commerzbank, Standard Chartered and Sampo were all in the market with deals. These are straightforward balance sheet and regulatory capital management exercises in the run-up to Basle II and as such tend to be large, one-off exercises. Both synthetic, RBS’s Arran Corporate Loans CLO is £3.5 billion equivalent and Deutsche’s London Wall 2006 deal is €3 billion. BNP Paribas’s Global Liberté V is predominantly backed by lending in the US and Canada and is $12 billion while Commerzbank’s CoCo Finance 2006 is a €4.5 billion trade. Standard Chartered’s latest balance sheet CLO references $1.6 billion of loans, and Sampo’s €1 billion Sea Fort Securities is the first CLO from a Finnish bank.

The US investment bank’s move points to a greater focus on the FIG hybrid capital sphere from its DCM coverage teams.

David Cameron, the Global Borrowers and Investors Forum and banks v boutiques...does size really matter?

The flight to safety has now become a flight to extreme safety as even the BIS joins in the chorus asking for higher rates. Yet economic rebalancing remains on target.