Latin Finance - September/October 2009 - 16

investment banking survey “The closest banks to us are not the competitively-priced quality advice and and having all the relationships and pure play investment banks,” remarks services, ranging from cash management not having all the raw material locally, a finance executive at one of Brazil’s to highly customized strategic advice, doesn’t work either,” he adds. top three commodities exporters who remains highly attractive. He adds that far from being an declines to be named, pointing to Citi and Citi and JPMorgan want to be that exotic outpost, LatAm business overall, JPMorgan as examples. HSBC and Calyon bank, while BofA Merrill is trying including investment banking, equity also fall within the company’s group of to become a third major contender. trading, risk, FX and asset management, banks, she adds. Santander and HSBC also want to is very important on a revenue basis to Credit Suisse is among the global whole. the few pure play shops that However, Investment Banking Fees by Country tend to participate frequently dominance in ECM, Brazil generates lion’s share in deals for her company. formerly driven by The same goes for Usiminas. its Brazil business, M&A Pereira says his company has been severely 2009 to August 17 2008 often turns to Credit Suisse undermined in the first Other LatAm (4%) Other LatAm (10%) for specialized, structured half of the year. As of Colombia (10%) Chile (4%) transactions. late August, it ranked JPMorgan’s expertise Argentina (7%) ninth in the regional Mexico (11%) in a number of countries league tables, according Colombia (3%) across various products, to Dealogic, having Mexico (5%) and in particular, pure play missed out on some of Brazil (71%) Brazil (75%) investment banking, as well the main local offerings as its balance sheet, makes like VisaNet, Brazil it hard to categorize. It has Foods, Natura and BR managed to find the right Malls. With three deals ECM balance between Brazil 2009 to August 17 worth $575 million, 2008 versus non-Brazil, clinching it accounted for only Mexico (2%) Other LatAm (1%) important mandates in 28% of the volume Other LatAm (19%) Mexico, Chile and Colombia. of underwritten by Its use of balance sheet JPMorgan, the number purely as an appendage of its one-ranked shop investment banking practice year-to-date. has boosted its M&A and And a series of staff Brazil (81%) Brazil (97%) DCM businesses, though not departures this year to without some unexpected competitors like BTG and hiccups. Goldman raises the issue “While we have capital of whether the shop has Source: Dealogic and we can use it to win been providing its midbusiness, that’s not the reason why we’ve compete in this bulge bracket, though level and junior bankers with the right won [mandates],” says JPMorgan’s they lack many traditional investment incentives. Competitors note that during Aguzin. “Except for a couple of instances, banking capabilities. With clients like a downturn, some of its rising bankers we’ve had no capital commitment to Usiminas, however, they have already opted for non-guaranteed posts at other transactions,” he claims. Indeed, at made headway. banks, including startups with less track companies like Gerdau, which has been a “[On debt] we work a lot with HSBC record. big user of the loan market in the past two and Santander,” says Eduardo Moreira As for UBS, its sale of Pactual leaves years, JPMorgan is seen as an investment Pereira, head of financing and treasury it with nothing to speak of in Brazil. The banking specialist with strengths in DCM, management at the Brazilian steel and Swiss shop insists that it plans to keep its non-Pactual assets, and has been rumored mining specialist. He notes Itaú Unibanco ECM, structured finance and M&A, and less of a balance sheet player, according to most recently to be preparing a comeback also offers a compelling combination, executives close to the client. and expects its nascent debt platform to in the country. Meanwhile, corporate services like eventually grow into a strong competitor. depository receipts, treasury services, In general, Pereira sees most banks Yankee Supermarkets derivatives and swaps have also given it offering niche specializations when it Some Brazilian corporate executives comes to banking, and says he will choose the chance to be in front of its clients on want a one-stop banking shop. While they usually benefit from the competitive them based on their respective strengths. a regular basis. “It’s still a very heated market and there are a lot of players This naturally implies working with a deal pitching, the idea of a single point providing services, but we tend to benefit large number of players. of contact that consistently offers 16 LatinFinance September/October 2009

Latin Finance - September/October 2009

Table of Contents for the Digital Edition of Latin Finance - September/October 2009