The politics of Europe have always been delicate for Germany. But in the last 12 months the volume of protest among Germans at having to bankroll European financial rescue packages has reached hitherto unknown levels. Many Germans are at a loss to explain why it falls to them to bail out profligate European partners in first Greece, then Ireland and now Portugal. Politicians and parties associated with the largesse bestowed upon the PIGs have already been punished at the polls and things could get worse still.
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German sovereign debt investors face a dilemma. Rising rates suggest higher yields but a peripheral meltdown or fading economic growth could push yields in either direction. Throw a highly uncertain political situation into the equation, and it is clear investing in German debt has never been so challenging. David Wigan reports.
A year on from the conclusion of the €60bn ECB purchase programme, amazingly, German covered bond issuance has increased. With tight spreads and continuing demand, German banks are focusing on the 200 year old product that is now their cheapestfunding tool. Aimee Donnellan reports.
A strong economy, relatively sheltered from the European sovereign debt crisis and economic downturn, has left Germancompanies and investors in a better position than many of their European peers to take advantage of relatively easy access to thesyndicated loan market. Isabell Witt and Alasdair Reilly report.
While some German structured products have weathered that past few years well, investors continue to shy away from so-called ‘risky’ assets, including anything associated with residential mortgages. While new investors are beginning to take up the slack, it will be quite some time before German securitisation returns to heyday volumes. Denise Bedell reports.
Germany has been a key battle ground for equity capital market bankers in recent years. Maturing investments owned by cash-hungry private equity houses have resulted in a clutch of successful Frankfurt flotations. Their subsequent strong aftermarket led to highly sought-after follow-on sell-downs as private equity sought an eventual exit. Robert Venes reports.
The perception remains that the German financial sector is rife with problems, constituting a potential hotbed of restructuring activity. In fact, while there are some long-term situations still working through the system, the sector has calmed down significantly in the last two years. Henry Gibbon reports.
Germany has been strongly pushing to speed up tightening regulation of financial markets. Rising political pressure has seen Germany advocate further legislation of hedge funds and sovereign debt, moving derivatives trading onto exchanges, anti-speculation measures and taxing banks to fund future bailouts. Hardeep Dhillon reports.
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DVB Bank has made a living out of marrying a specialisation in a niche and complex part of the market – transport financing – with a conservative approach to deals. The resulting formula is a unique business model that offers good margins and few competitors, though with high sector concentration and currency risk. Keith Mullin reports.