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P&M;: Promotion for Natixis deputy head of financial institutions and public sector
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DERIVATIVES: Liquidity crisis drives equity skew to LTCM levels
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EUROPEAN CORP BOND WRAP: Red Electrica whisper; more supply forecasts
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SSA/COVERED WRAP: Primary coming alive, ING review, Gilts update
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P&M;: Collins Stewart hires consumer goods analyst
Top stories
Banks line up for BHP
BHP Billiton’s US$45bn loan backing its hostile buyout of Canada’s Potash Corp showed that reports of the demise of the loan market’s capacity to finance huge M&A transactions have been greatly exaggerated. Syndicators assembled the mammoth loan in a mere 10 days, with underwriters committing more than US$8bn each. Tessa Walsh reports.
GM gets into gear
Just one year removed from its emergence from bankruptcy protection, General Motors has remoulded itself into a low-cost, streamlined operator with global ambitions. The American icon will return to market with one of the largest-ever IPOs, but caution and a desire for maximum proceeds will see several investor bases tapped for funds. Stephen Lacey reports.
Back from the dead
The first European managed CLO since the depths of the financial crisis has arrived. The deal, which is backed by leveraged loans from RBS’s non-core loan book, conforms to the latest – and harshest – rating agency methodology and may blaze a trail for others looking to dump legacy assets. William Thornhill reports.
Basel backs burden-sharing
The Basel Committee has issued a proposal to ensure that bond investors shoulder a greater share of the burden when banks fail, before any intervention from the public sector. The measures, which will ensure that bonds take a loss at the point of non-viability, will increase costs for issuers and may deter some bond investors. Matthew Attwood reports.
Chaoda triple combo
After several poor experiences when issuing new equity, Chaoda needed a structure that would provide tighter pricing and a better aftermarket. The Chinese firm turned to the Indian market for inspiration, resulting in a packaged structure of bonds, warrants and equity. Shankar Ramakrishnan reports.
McDonald's adds to renminbi menu with first EMTN
Global fast food operator McDonald’s on August 19 launched the first renminbi-denominated bond from a multinational corporate issuer. The Rmb200m (US$29.4m) three-year offer targeting institutional investors carries a coupon of 3% and is scheduled to settle on September 16.
CME holds its ground
Treasury futures start-up ELX has moved a step closer to breaking the Treasury futures monopoly enjoyed by the Chicago Mercantile Exchange. A new CFTC ruling requires the CME to accept fungible futures contracts from other venues, but the futures giant is standing its ground and preparing for a lengthy battle. Gareth Gore reports.
IFR on Reuters Insider
Aug 24: Basel Committee backs burden-sharing for bank bond investors
New proposals from the Basel Committee could mean bond investors bear a greater burden when banks fail. IFR’s Matt Attwood tells us what the proposals could mean for debt markets.
Aug 17: Russia's planned debut Eurorouble bond seen worth US$2bn
Russia is expected to launch a debut benchmark Eurorouble bond issue in the third quarter to raise about US$2bn at a healthy premium over the country’s dollar bonds, says IFR’s John Weavers.
Aug 10: Life seen stirring in dormant RMBS market
The stabilisation of delinquency rates is breathing some life into the UK’s dormant residential mortgage-backed securitisation market, with deals now in the pipeline, says IFR’s Bill Thornhill.
Up Front
Big boys' toys
The loan market showcased all of its traditional virtues of speed, size and confidentiality last week by lining up a US$45bn loan to back BHP Billiton’s hostile bid for Canada’s Potash in a mere 10 days.
Doing it for the kids
Citigroup, the financial supermarket that nearly went bust and is now 18%-owned by the US government, has opened the equivalent of a children’s section. The bank is testing a website to let the children of its wealthiest clients manage their allowances, while alerting parents and bankers if the kids spend the cash too quickly.
US judges get tough
With more US regulatory settlements questioned by judges last week, it is clear that the judiciary is no longer satisfied with the SEC imposing modest fines for corporate wrongdoing. Such arrangements are likely to be scrutinised more heavily, with the courts wary of shareholders taking hits through company fines. They want the blood of executives, as Christian Murray reports.
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