In many ways it has been a fantastic 12 months for Germany. Some of the markets for which it is most renowned have witnessed an impressive return to form that almost constitutes “business as usual”. The Pfandbrief sector, the financial market most synonymous with Germany, has in some ways shrugged off memories of the credit crunch and looks to be in rude health. But closer inspection reveals the last two years have left scars. While the position of Pfandbriefe as a key funding tool for German corporates is not in question – and spreads have...Read more
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A regulatory tug of war is being conducted in Germany. In the blue corner is the central bank, the Bundesbank, a grand old institution that has felt a little marginalised since its key functions were transferred to the ECB. In the red corner is the younger BaFin, the incumbent regulator that many have blamed for being asleep at the wheel when the financial crisis dawned. Justin Pugsley reports.
The Pfandbrief market emerged from the crisis in good form, with appetite again strong and spreads compressing. But the depth of domestic demand combined with net negative supply could actually thwart plans to internationalise the asset class. Philip Wright reports.
The story of the rebuilding and the eventual consolidation of the German Landesbank sector has run throughout the financial crisis, and progress has been painfully slow. Given the bureaucracy involved, that is hardly surprising. But signs are emerging that the next year could finally see significant developments, with WestLB likely to set the template for others to follow. Mark Baker reports.
Germany has established a claim to be Europe’s leading loan market. Not only did the country’s corporates borrow more in the first quarter than those from any other EMEA jurisdiction, they provided some of the year’s most significant deals, which are quietly setting a lead for others to follow. David Cox reports.
Germany went from being a core ECM market pre-crisis to smaller than some emerging markets as the crisis unfolded. Yet the country has been the source of the most significant deal structuring when firms have needed to replace debt funding. It is also at the forefront of the IPO revival, though with four months of the year done the market may have run out of steam. Owen Wild reports.
The German securitisation market is slowly reviving, with more than a dozen publically placed and retained securitisations hitting the market in the last year. However, the trickier area of funding SME lending via the CLO market remains a more distant and challenging prospect. Despite industry efforts to revive this sector, SME lending looks set to remain constrained unless the State lends a hand. William Thornhill reports.
Despite some high profile deals, the flood of restructuring activity has yet to break in Germany. But those deals that have happened have been innovative and surprising, creating a dynamic and unpredictable market environment, often despite the best efforts of cautious creditors. Donal O’Donovan reports.