What is there to say about 2013? Well the first thing banks should say (again) is “thanks very much”. Thanks, that is, to policy makers and central bankers around the world for pumping so much free money into the system.
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Heavy mettle: The complex regulatory landscape transforming investment banking is a burden for any firm. Navigating it while dealing with reputational issues and serial investigations – and remaining focused on clients at the same time – is more difficult still. For doing all this successfully, and sticking it out to win substantial gains in market share despite tough economic headwinds, Goldman Sachs is IFR’s Bank of the Year.
Still performing
From momentum to leader
Making it better
Everything, everywhere
Anatomy of a giant: Verizon’s US$49bn bond. This is a behind-the-scenes look at the trials and tribulations of creating the biggest bond deal ever. It was a transaction many years in the making, but when it came together, it did so very quickly indeed.
Some of the world’s biggest banks – including Deutsche Bank and Barclays – completely misjudged regulators’ determination to clamp down on leverage. Many were forced into panic overhauls, even though the shift had been well flagged for almost three years.
+-Fixed-income, currencies and commodities units have been the banking industry’s main cash cow for years. But that looks to be coming to an end, as business heads wrestle with new capital, leverage and derivatives trading rules.
The laborious implementation of the Dodd-Frank Act is in the home straight. Some confusion remains as the business of trading swaps on exchanges begins in earnest, but even some former critics accept the regulators have got most things right so far.
ECM block trades virtually vanished during the financial crisis. Now they are big business again as banks vie for jumbo deals and assume massive risks. The year is littered with failed transactions, yet banks can’t help but come back for more.
Most experts agree that banks – even the largest ones – are considerably safer now than when the financial crisis kicked in. But what happens if trouble comes calling again? Would national and international overseers let them fail?
While US banks raced to clean up their mess after the financial crisis kicked in, European banks – and their regulators – have taken their sweet time. The result? The Americans are now poised to steal a march – and plenty of market share – from their rivals across the Atlantic.
Japan’s unprecedented monetary experiment has won it cautious approval from the rest of Asia, but will the so-called third arrow of greater structural reform actually arrive? Much is riding on the country’s ability to deliver on its promises.
Japan’s three mega-commercial banks and the country’s leading investment banks are on a roll. Results for the second quarter of the 2013–14 fiscal year, unveiled in mid-November, were spectacular and easily outperformed those of peers in the US and Europe. Outlook for the full fiscal year is bullish, as the banks set about targeted growth at home and internationally.
Syndicating bond deals has always been more art than science. But it is even more a leap into the unknown these days, thanks to tighter rules on communication with investors and the growing illiquidity of secondary bond markets.
An old bond market dog, as Anthony Peters describes himself, takes a look at the state of the secondary markets – and despairs. 2013 could have been the year when a new world in the markets began to emerge. If so, it won’t be one to his liking.