EMEA Loan House: BNP Paribas

Syndicated lending tumbled in 2016 as refinancing activity slumped in a volatile year full of political surprises. For providing much-needed stability, consistency and reliability in turbulent times, BNP Paribas is IFR’s EMEA Loan House of the Year.

Yet again, BNP Paribas topped Thomson Reuters bookrunner league tables for the awards period, with US$54.2bn of volume and 201 deals, giving it a leading 7.72% market share.

The year caps a hugely successful run for the French bank, which has dominated EMEA lending as top bookrunner for six of the last seven years, only ceding the top spot to Deutsche Bank in 2012.

BNP Paribas has increased its EMEA bookrunning share in each of the last three years from US$48bn and 208 deals in 2013 to US$60bn and 252 deals in 2015, despite increasingly fierce competition from highly liquid banks.

“BNP Paribas has remained at the top of the league tables, we’ve been there consistently and still are,” said Charlotte Conlan, head of loan and high-yield syndicate, EMEA.

The loan market has been under pressure in the last 12 months due to an uncomfortable combination of rock-bottom pricing and rising macroeconomic and political risk, which made maintaining a market-leading position no mean feat amid a shortage of deals.

At the end of September, EMEA loan volume of US$590bn was 22% lower, with a bigger 32% drop in leveraged loans as sporadic M&A activity failed to compensate for what used to be high levels of corporate refinancing .

“We’ve improved year-on-year and in a quieter year of low issuance we’ve increased our market share, which is a testament to our origination business,” Conlan said.

BNP Paribas is reaping the rewards of creating a single corporate debt platform in 2015, which brought together the loan and bond origination teams in addition to a single global syndicate platform.

This has been supplemented by specialised teams that assist clients with asset financing, including real estate, energy, infrastructure, transportation and export finance as the bank focuses on developing its next generation of management.

“We have made a huge effort to de-layer with a younger and more diversified management team. We were very French; the new generation is less French and male, and more female and international,” said Pierre Semeria, head of investment-grade loans.

BNP Paribas remains a resolutely European bank and has an enviable client roster with 1,600 accounts across Europe, rising to 2,000 including middle-market companies.

“The loan product is a core business to the bank,” Conlan said. “Given the breadth of our corporate loan product everywhere, we’ve clearly outperformed our competitors on our ability to deliver – even in a quieter market – due to the uniqueness of the platform we have.”

Across the board

BNP Paribas played across the board from the biggest investment-grade names that defined the year to middle-market deals, leveraged loans, and energy and infrastructure finance. It was also active in a range of more esoteric products including Schuldscheine – Europe’s fastest growing product this year – and the fast-developing world of fund finance.

In investment-grade lending, the bank was one of two underwriters, MLAs and bookrunners on US$13.1bn of facilities backing French food company Danone’s acquisition of US rival WhiteWave.

It was also one of two underwriters and bookrunners on Air Liquide’s US$13.4bn acquisition of US-listed Airgas and was an agent on Anheuser-Busch InBev’s US$42.5bn acquisition loan backing the takeover of rival SABMiller.

BNP Paribas has been developing its franchise further in Europe, outside its French power-base. A strategic push in Germany that has been many years in the making finally started to bear fruit, as the bank took advantage of German banks’ weakness to add high-quality risk.

This brought mandates including a role on German consumer products maker Henkel’s US$2.5bn bridge loan backing its acquisition of US laundry and home care products maker Sun Products and the bank was one of four coordinators on German automotive parts maker Schaeffler’s €2.3bn crossover refinancing.

Sentiment ebbed and flowed in leveraged loans during the year, but BNP Paribas was undaunted. It was straight out of the gate in January 2016 with six leveraged loans and even managed to reverse-flex Atos Medical’s SKr2.42bn (US$260m) Term Loan B transaction on the Monday after Britain’s vote to leave the European Union in June, which roiled markets.