The world’s top debt banks increased new issue volumes in 2020 and moved to meet investor demand for green and sustainable bonds.

A pandemic, along with lockdowns, travel restrictions and the ensuing economic downturn, made 2020 a challenging year for all industries; and Debt Capital Markets (DCM) were not exempt.

The best DCM investment banks, including Global Finance’s 2021 Best Investment Banks in this category, have done their best, however.

“We knew that the liquidity position in global debt markets was healthy and further supported by the support of the [US] The Federal Reserve’s sharp rate cut,” says Salman Ansari, Managing Director and Head of Capital Markets for the Middle East and North Africa (MENA), Europe and Americas at Standard Chartered, “we We have therefore worked with our clients to identify the most appropriate strategy to take advantage of this financing.

Standard Chartered won the title of the best debt bank in the world as well as the best debt bank in the Middle East by working on some of the biggest debt problems of the year, including Qatar’s $ 10 billion bond in April and others for the United Arab Emirates (UAE) and Saudi Arabia. Standard Chartered topped Refinitiv’s 2020 MENA bond underwriter rankings with $21.4 billion in related products and an 18% market share.

In June, he also acted as mandated lead arranger for the acquisition financing facility for the largest energy infrastructure investment in the region and one of the largest in the world last year: a Abu Dhabi National Oil Company (ADNOC) pipeline which is projected to bring $10.1 billion in investment to the United Arab Emirates.

After going through a particularly difficult year in 2020, global debt banks could now face a similar situation, according to Ansari. This year will see “an even more volatile rate environment as investors grapple with the likelihood of higher inflation in the short to medium term,” he said.

“The Covid-induced crisis has inflicted considerable pressure on emerging markets as global investors turn to safe-haven assets until the spread of the virus is contained,” says Brad Maxwell, managing director of the bank. investment in Nedbank, this year’s best debt bank in Africa. Nedbank’s corporate and investment banking unit has made a particular effort to work closely with clients “to help them get through a turbulent year”, he adds. Nedbank is the fourth largest bank in South Africa and the first bank in South Africa to issue a renewable energy bond.

Nedbank has become the first South African issuer to join Nasdaq’s Sustainable Bond Network. The bank has also worked to strengthen its environmental, social and governance (ESG) standards, Maxwell said, noting that it was already the first bank on the continent to adopt the Equator Principles, a framework for managing risks used to assess environmental and social risks to a large extent. projects. Nedbank was Africa’s first carbon neutral bank and had been on the Dow Jones Sustainability Index for 16 years.

Bank of China (BOC), Global Finance’s top debt bank in the Asia-Pacific region, ranked 15th globally among bookrunners last year with $178.7 billion in revenue and 2 345 transactions: the best among Chinese banks, according to Refinitiv. Many of its deals involved Chinese state-owned companies, including State Grid Corporation of China, an electric utility, for which BOC acted as joint global coordinator under a bond agreement. $3.3 billion jumbo.

The BOC is traditionally the strongest of China’s big four banks when it comes to international debt financing. Reportedly, it has sought to increase staff in its offshore bond business lately and develop more resources in the areas of settlement, market making and credit research. BOC is also a perennial leader in the Panda market, attracting foreign issuers to the domestic renminbi-denominated bond market; last year, it again dominated all the banks in the category.

When Russia first tapped the global debt markets in 2020, the two sovereign Eurobond issues were co-arranged by Sberbank, Global Finance’s top debt bank in Central and Eastern Europe in 2021.

The two euro-denominated bonds hit the market in November with bids exceeding 2.7 billion euros ($3.2 billion): a warm welcome given that Russian Eurobonds often have liquidity and that the US government has prohibited US banks from buying them directly, although they can do so in the secondary markets.

The Russian government has also recently issued ruble-denominated bonds on the domestic market to offset its budget deficit; and in this sector, too, Sberbank has been a leader. It was the world’s second-largest bookrunner by ruble-denominated DCM volume in 2020, up from third in 2019, according to Dealogic, with 77 transactions and a 15% market share. In January of this year, he was the organizer of the first issue of a social Eurobond by a Russian issuer: the placement of 300 million dollars by Sovcombank.

The green bond market has also grown recently in Russia.

“The Bank of Russia, Moscow Stock Exchange, VEB.RF and other entities have developed a taxonomy of green projects and infrastructure for the green finance market, including green bonds,” says Eduard Jabarov, co- head of global DCM at Sberbank, although “Further market support measures are needed in order to stimulate demand from local investors and ensure a significant boost for issuers to place ESG bonds.” These include preferential taxation of income on ESG bonds and relaxation of accounting rules and requirements for banks and investment firms, he says.

Universal bank Nordea is a powerhouse in the Nordic region and beyond, earning it the title of best debt bank in Western Europe. The Helsinki-based institution was the No. 1 bookrunner in Swedish krona-denominated DCM by volume in 2020, according to Dealogic; and second in the corresponding Norwegian market. It also ranked first in All-Nordic investment-grade DCM volume by bookrunner and All-Nordic high-yield DCM volume, Dealogic reports.

Nordea was also a player in the green bond and sustainability space last year, ranking 25th among global bookrunners in the green bond category, with 36 deals generating $3.1 billion in revenue in 2020, according to Refinitiv. In August, it set up the first sustainability-linked leveraged buyout loan in the Nordic region; and it has committed as a company to “a goal of net zero emissions by 2050 at the latest”.

Bradesco BBI, Latin America’s top debt bank, was responsible for more than $22 billion in local and international DCM transactions last year, mostly on behalf of Brazilian companies. In the Latin America regional market, the bank ranked third among bookrunners in 2020 by DCM volume, with $2.1 billion across 28 transactions for an 11.7% market share, according to Dealogic.

Bradesco BBI also played an active role in the record issuance of green and sustainable bonds in Brazil in 2020. In September, Brazil had already surpassed the total number of green bond issuances in the previous year, ESG concerns gaining traction with investors. In DCM roadshows, says Philip Searson, managing director and head of fixed income at Bradesco, “companies were asked a lot more about negative socio-environmental externalities and how they act to generate positive impacts,” and the Covid crisis has only increased their level of concern. .

JP Morgan, the largest bank in the United States and the best debt bank in North America in 2021, once again topped DCM by several measures. It was the world’s largest DCM bookrunner with $685.5 billion in revenue from 2,568 transactions and a 6.7% market share, according to Refinitiv.

The US debt capital market is huge; and in 2020, it grew 37% year-on-year, according to Dealogic, with $4.3 trillion in volume that eclipsed Europe, the Middle East and Asia. Europe is the second largest region with $2.5 trillion. JP Morgan was the leading bookrunner in the US DCM market, with $2.2 billion in revenue and a 12.4% market share; and it also led the US DCM in volume, with $500.3 billion across 1,946 transactions and an 11.7% market share. The bank was also a leader in other categories, including US investment-grade debt, US high-yield corporate debt, mortgage-backed securities and US asset-backed securities.

Where will the market take the 2021 DCM leaders? Continued fiscal stimulus could lead to further interest rate growth around the world, says Olga Gorokhovskaya, Managing Director and Co-Head of DCM at Sberbank CIB. This could pose a “major challenge for public debt markets”, she warns, affecting the willingness of issuers to seek new funding. On the other hand, given “the strong economic recovery that is emerging, risk appetite should remain healthy, which would support primary DCM markets”.