Awards for Achievement 2009: Day 2

Today we announce the Best Deals of the Year.

The following deals, the banks that worked on them and their clients will be honoured at an awards dinner at the Conrad Hotel in Hong Kong on February 4. If you would like to book a table at the event, please contact Stephanie Cheung on +852 2122 5225 or [email protected].

$3.3 billion IPO for Maxis
Bookrunners: CIMB, Credit Suisse, Goldman Sachs, J.P. Morgan, Nomura, UBS
Legal Advisers: Clifford Chance, Linklaters, Adnan Sundra & Low, Kadir Andri & Partners, Zul Rafique & Partners

It has been a long time since a Southeast Asian IPO stood out among the crowd of new listings by Chinese companies. For four years straight, FinanceAsia's IPO of the year has been a Chinese issuer listing in Hong Kong. But Maxis ticks all the right boxes for being the top equity deal of the year. It was the largest-ever equity offering in Malaysia, the largest IPO in Southeast Asia ever, the largest telecom IPO in Asia since 2000 and the largest IPO in the sector globally since 2004. It was skilfully marketed to stand its ground and attract sufficient investor attention against a large backlog of other IPOs, achieved a significant premium against regional comps and traded up 8.4% on the first day.

The deal is part of the privatisation-restructuring-relisting trend that has been evident on a small scale in Asia in recent years, but also fits well with an emerging spinoff trend that bankers expect will gather pace in 2010.

A spinoff from Maxis Communications, which was privatised two years earlier, the bookrunners did a good job of positioning the Ananda Krishnan-controlled company as a yield play with significant exposure to key indices to make investors see the benefits of buying into a pure domestic telecom operator in a mature market, while the group's high-growth businesses in India and Indonesia reside with unlisted Maxis Communications. To increase the chances of success, the bookrunners made use of cornerstone investors -- a first for a Malaysian IPO -- securing firm commitments for $920 million worth of shares before the broader bookbuilding began.

The reason why this deal is not receiving our Best IPO award is simply because we rank the achievement a bit broader than that -- it wouldn't have been easy to get international investors to put their money in Malaysia while the world was still recovering from the worst financial crisis in 80 years and analysts argue that the deal has the potential to raise the international profile of the entire Malaysian market. We also thought we'd take the opportunity to award two IPOs in a year that ended up being heavy on new listings.

Sinopharm's $1.3 billion IPO

Bookrunners: China International Capital Corp, Morgan Stanley, UBS
Legal Advisers: Baker & McKenzie, Morrison & Foerster, Chen & Co, Grandall Legal Group

China's largest distributor of pharmaceuticals took the lead among a long list of Chinese companies lining up for a Hong Kong listing when it started to accept orders in early September -- and didn't let go of the initiative. Despite direct competition from Metallurgical Corp of China's dual A- and H-share listing, which kicked off a day later, the prospect of many more deals to come and an aggressive price range, Sinopharm attracted $114 billion of demand, priced at the top end of the range -- achieving a record price-to-earnings multiple for an H-share listing -- and traded up 16% on the first day.

But it was from the second trading day onwards that the quality of the execution really became clear. Even though MCC fell 11.7% on that day (its H-share debut), starting a trend of poor debuts that kept its grip on the market for the coming month, Sinopharm held its ground and was able to exercise the greenshoe in full at the end of the third day. When sentiment improved, the stock continued to head higher.

The groundwork for this was laid through a large number of one-on-one meetings -- 98% of which led to actual orders -- and the inclusion of nine high-profile cornerstones that anchored the deal. The marketing focused on the company's position as the only nationwide player in an industry that is expected to see significant growth in the years ahead, enabling the company to justify a pricing in line with A-share listed companies in the same sector, even though this translated into a significant premium against internationally-listed peers.

A strong order book comprising 700 institutional investors, almost no price sensitivity and the second-largest retail subscription for a Hong Kong IPO ever, together with the impressive aftermarket trading and the fact that this was the largest healthcare listing ever in Asia, makes Sinopharm a worthy winner of our Best IPO title.

Bank of America's $2.85 billion sell-down in China Construction Bank

Bookrunners: Merrill Lynch, UBS
Legal advisers: Cleary Gottlieb Steen & Hamilton; Freshfields

Not only was this the largest block trade ever in Hong Kong, but it came on January 7 when markets were still heavily under the influence of the credit crunch, the business pages were full of stories about bank layoffs, and people were generally quite pessimistic about the outlook for the year. To bring a deal of this size at that time, and to step up and hard underwrite it as UBS did, was pretty gutsy. However, a sell-down had been expected ever since Bank of America exercised a series of options in mid-November that increased its stake in CCB to 19.1% from 10.75%, so to get the overhang out of the way early was a good move by BoA.

The shares, which accounted for 2.5% of CCB's H-share capital, were offered at a fixed price that translated into a discount of 11.9% versus the previous day's close, but the deal was still done through accelerated bookbuilding, as opposed to on a first-come, first-serve basis, to ensure the stock went to as good a group of investors as possible. To ensure maximum success, demand was also generated through a wall-crossing process the previous night and the deal was launched at 5am Hong Kong time to allow the bookrunners to tap any potential interest in the US and Europe, and then Asia, before the Hong Kong market opened at 9.30am.

The deal ended multiple times subscribed and the share price held above the placement price on the day of issue despite a collapse in the broader market, showing that the early launch hour worked and gave the bookrunners enough time to place a large portion of the shares in safe hands.

Given the timing, this is a deal that really can claim to have reopened the market and it also stands as the largest example of the sell-downs that were one of the dominating themes in the first half of this year. It was followed later in the same day by a $511 million sell-down in Bank of China by the Li Ka-shing Foundation and a week later by the Royal Bank of Scotland's $2.4 billion divestment of its entire stake in the Bank of China.

Bumi Resources' $375 million CB

Bookrunners: Credit Suisse
Legal advisers: Linklaters

This five-year convertible bond, which was priced at the end of July, was structured to meet specific issuer requirements, such as minimum equity dilution and cash interest payments. It also had to take into account the lack of a natural investor base for unhedgeable non-investment grade CBs and the fact that investors may well ask for a coupon in the double-digits to participate in a deal by this credit, an Indonesian coal miner.

Credit Suisse solved these issues by attaching an equity swap to enable hedging, which in turn allowed for tighter pricing, including a coupon of 9.25%. It also included a call-spread overlay -- a first for an Asian CB -- to boost the 30% premium sold to CB investors to an effective 75% for the issuer, significantly reducing the potential dilution in the process.

The details may have been complicated, but the final result was simple: Credit Suisse was able to deliver a deal that not only met Bumi's objectives, but which was also well received both by CB investors -- as evidenced by the fact that the deal could be upsized by 87.5% from $200 million -- and equity investors (the equity swap led to buying of Bumi stock in the market). The share price gained 20% in the first three days after pricing and in late September peaked some 53% above the pre-deal level.

The successful transaction allowed Bumi to return to the capital markets in November with a $300 million seven-year bond issue and a second CB, this time a $300 million seven-year deal with a one-year put.

Real Gold's $133 million IPO

Bookrunners: Citi, Macquarie
Legal advisers: Hogan & Hartson, Latham & Watkins, Mallesons Stephen Jaques, Gorden Ng & Co, Jun He Law Offices, King & Wood, Conyers Dill & Pearman

When the Chinese gold miner started marketing its IPO in early February, it had to overcome not only the fact that there had been no new listings in Hong Kong for almost four months and that it was coming to market at a time when people remained highly sceptical about the year ahead, but also the fact that it had been in operation for less than half a year. Citi had identified gold as one of the things that might sell even in the midst of the financial crisis, but it wasn't making it easy for itself by bringing a company that needed a waiver from the stock exchange to allow it to list without a three-year track record of operations and profits, as is otherwise compulsory. This is not unusual for mining companies in commodity-rich countries such as Australia, but in Hong Kong it was a first and added to the challenge.

Yet, a well-defined marketing strategy that focused on positioning the company as a high-growth pure gold player (other Hong Kong-listed gold miners all have other businesses such as smelting or copper mining) allowed it to generate sufficient demand to carry it off -- an achievement that makes Real Gold worthy of our mid-cap deal award.

To ensure success, the bookrunners started to identify potential investors already in mid-December and, during the bookbuilding, they demanded that institutional investors confirm their orders early, which allowed them to go out with a message that the books were covered before the retail offering started. They then leveraged off the resulting strong retail demand to eliminate price sensitivity without reducing the investor quality. The final demand totalled $2.1 billion and the deal was priced at the top of the range, for only a slight discount against its larger and more established Chinese peers.

The share price was flat on the first day of trading, and fell below the issue price in the next few months, but by early December the stock had more than doubled alongside the rise in gold prices -- even though Real Gold raised another $130 million from a top-up placement to pay for an acquisition in September. This shows that it was the right call to bring the company to market early in the year, so that it could benefit from the improving sentiment for gold.

Greens Holdings' $63 million IPO 

Bookrunners: Morgan Stanley
Legal advisers: Debevoise & Plimpton, Skadden Arps Slate Meagher & Flom, Charltons Solicitors, Hammonds, Haiwen & Partners, Jingtian & Gongcheng, Conyers Dill & Pearman 

A small-cap supplier of heat transfer products that are used to enhance energy efficiency, Greens was able to stand its ground and generate sufficient demand even with six larger IPOs pricing in Hong Kong the same week. The company, which priced its offering on October 30, also had to deal with the fact that the strong secondary market that it had faced during pre-marketing reversed into a downturn during the roadshow.

But the company's "green" angle and the positioning of it as a gradual mover into other alternative energy areas such as waste heat power generation and wind power equipment resonated well with investors, and despite the small size, the IPO attracted some of the highest quality accounts in Asia. The fact that the deal was brought by Morgan Stanley likely helped in this respect, as the bank is making a strong push into renewable energy -- particularly wind -- and is building a pipeline of companies to take to market in this sector.

The institutional order book was multiple times covered, while retail investors asked for more than 15 times the shares initially set aside for them, triggering a clawback that increased the retail tranche to 30% of the deal.

The price was fixed slightly above the low end of the price range for a 2010 price-to-earnings multiple of 10. Some investors obviously saw this as good value as the share price surged 12.3% on the first day. In late November the stock followed the market lower and dropped below the IPO price, but by early December it had returned to positive ground.

The company originated in the UK in the mid-1800s but set up manufacturing facilities in China in 2003 and has since captured a 66% share of the market for extended surface economisers in the mainland -- the world's largest market for economiser products.

Please go to the next page for more deal awards...

Minmetals' $1.2 billion acquisition of part of Oz Minerals
Adviser to Minmetals: UBS
Advisers to Oz Minerals: Caliburn Partnership, Goldman Sachs JBWere
Legal advisers: Blake Dawson, Freehills

In February, China Minmetals Non-ferrous Metals Company, a Chinese state-owned enterprise, made an offer to buy 100% of the equity of Oz Minerals for a value of A$2.6 billion ($2.4 billion). Melbourne-headquartered Oz Minerals was the world's second-largest producer of zinc and a substantial producer of copper, lead, gold and silver. It had A$1.2 billion of debt due to be refinanced by February 27 so the deal was critical for its survival.

The deal was largely eclipsed by an announcement a few days earlier that Aluminum Corporation of China (Chinalco) was investing $19.5 billion in Rio Tinto, an Australian diversified metals and mining company. Like Oz Minerals, Rio Tinto was struggling to service its debt burden. But the Rio Tinto deal was never about control, whereas Minmetals wanted to take over Oz Minerals.

In March the Foreign Investment Review Board deferred a decision on the Chinalco investment. Meanwhile, around the same time, the Australian government rejected the Minmetals proposal on grounds of national security. One of the assets Minmetals would have taken over as part of the buyout of Oz Minerals was a mine at Prominent Hill, which is located near an Australian defence testing facility. Minmetals and Oz Minerals went back to the drawing board and within a week tabled a proposal that excluded the Prominent Hill mine.

Sounding out regulators to ensure that key approvals for deals will be forthcoming is a key role played both by the advisers and the parties themselves. Presumably both buyer and seller, as well as the advisers they hired, did this in advance of announcing the February deal. Indeed, when Andrew Michelmore, chief executive officer of Oz Minerals, spoke to media he specifically said that approvals for the initial deal, which included Prominent Hill, had not been expected to be an issue.

It is likely that noise surrounding the fact that three Chinese investments into Australia were announced in quick succession in February made Australian regulators scrutinise the deal more rigorously. Also, the testing facility has non-Australian contracts and customers could also have objected to the takeover by a Chinese SOE. Or a combination of all these could have happened.

And precisely this is one of the aspects that makes this M&A deal worthy of our highest awards. Uncertainty is a key element of M&A deals, to the extent that the advising banks never attribute 100% probability of success to a deal when it is announced. The various approvals still pending add an element of uncertainty, which varies from deal to deal, and causes a number of deals to fail even after announcement.

The ability of a Chinese government company, working with its advisers, to move forward -- from what could have been perceived as a rebuff -- quickly and constructively deserves credit. Minmetals remained focused on its goal of securing control of Oz Minerals' mines, digested the fact that it could not have them all and identified some it was still interested in. The revised deal went on to secure all necessary approvals. The deal bodes well for outbound M&A from China, which is largely being attempted by the country's many SOEs.

OCBC's $1.46 billion takeover of ING's Asian private banking assets

Adviser to OCBC: Goldman Sachs
Adviser to ING: J.P. Morgan
Legal advisers: Clifford Chance, Freshfields, Drew & Napier, Stamford Law

In October, Singapore-based Oversea-Chinese Banking Corporation (OCBC) emerged the winner in an auction for ING's Asian private banking business, with a bid of $1.46 billion. This marked the end of a deal that pitted stalwarts such as HSBC, Credit Suisse and DBS against each other.

The deal was to all intents and purposes Singaporean, with the only difference being that the seller is European. ING's private bank is one of a handful of licensed banks in Singapore alongside OCBC, DBS and United Overseas Bank. The business is Singapore-incorporated and the Monetary Authority of Singapore (MAS) was the key regulator for the deal. The chief executive officer for ING private banking worldwide, Philippe Damas, is based in Singapore.

OCBC bought a business with 150 relationship managers, more than 5,000 clients and $15.8 billion of assets under management (AUM). The acquisition trebled OCBC's AUM to $23 billion, representing a "transformational step" in its private banking business, the Singapore bank acknowledged. The acquisition price of $1.46 billion translates into 3.4% of AUM.

The deal was closed in a record time of less than six months from start to finish. The acquisition was keenly contested as opportunities to inorganically grow private banking portfolios are rare. But key issues for ING had to be addressed during the process. ING was concerned that during the auction, its competitors who were in the fray to buy the business should not start poaching its people -- and with all private banks in Asia in expansion mode, this was a very genuine concern. By incorporating a non-solicitation contract in the non-disclosure agreement, ING ensured that the employees of the private banking business, who were critical, were not "shopped" by potential bidders during the process.

Equally critical was ensuring that the winning bidders were parties that would secure necessary approvals from regulators in Singapore. Thus, the deal was announced only after the MAS had been sounded out that the winning bidder was an acceptable party, which helped to minimise uncertainties after the announcement.

KKR's $1.8 billion takeover of Oriental Breweries
Advisers to KKR: Goldman Sachs, HSBC, ING, Nomura
Advisers to AB InBev: Deutsche Bank, J.P. Morgan, Lazard
Underwriters: HSBC, J.P. Morgan, Nomura, Standard Chartered

Other bookrunners: Calyon, Hana Bank, ING, Korea Development Bank, Natixis
Legal advisers: Paul Hastings, Simpson Thacher & Bartlett, Sullivan & Cromwell, Bae Kim and Lee, Kim & Chang, Lee & Ko

The past year offered scant opportunities for financial sponsors in Asia. The credit crunch resulted in a scarcity of debt for them to lever up their deals and valuations in Asian markets did not come off enough for them to go bargain hunting. However, the $1.8 billion takeover by private equity firm Kohlberg Kravis Roberts of Anheuser Busch InBev's Korean business, Oriental Breweries, is a deal that would have been worthy of an award even if the year had been crowded with private equity deals.

The auction for OB was highly competitive and KKR was the dark horse. Local retail group Lotte and domestic private equity firm MBK Partners were generally considered to have an upper hand in a country where foreign private equity has a somewhat chequered reputation.

The business on sale included iconic brands such as Cass, the most popular beer in Korea among the younger generation, OB lager and Cafri, as well as exclusive licences to distribute certain InBev brands in Korea, such as Budweiser, Bud-Ice and Hoegaarden.

The deal is the largest financial sponsor M&A buyout in Korea ever, exceeding the $1.2 billion buyout of Korea Exchange Bank by Lone Star Funds in 2003. When it was announced, it was the second-largest private equity deal in the world this year.

The deal was done at a healthy leverage, especially considering it came just after the credit crunch. KKR provided around 40% of the consideration as equity with the balance 60% raised as debt. Affinity Equity Partners subsequently joined KKR as an equal equity partner in the transaction.

The debt was raised at around four times Ebitda. InBev provided one-third of the debt as vendor finance. Another $825 million of debt was syndicated among a consortium of banks in a combination of Korean won and US dollars. A $75 million revolving credit facility was raised entirely in Korean won. The debt was underwritten by HSBC, J.P. Morgan, Nomura and Standard Chartered with a number of bookrunners joining the syndicate on a take-and-hold basis.

The final syndicate also included DBS, Korea Exchange Bank, Sumitomo Mitsui Banking Corporation, United Overseas Bank and WestLB. The interest in the syndication was so high that the underwriters had already managed to sell down a substantial part of their positions by the time of funding.

The deal terms include a right for InBev to re-acquire OB within a five-year period, according to pre-determined terms, a neat exit for the private equity buyer.

One of the most interesting things about the deal was how terms reflected the prevailing market environment, but were also structured to suit the requirements of both the buyer and the seller, resulting in a rarity in M&A deals: a satisfied buyer and seller.

Please go to the next page for more deal awards...

Hutchison Whampoa's $3 billion dual-tranche global issue
Lead managers: Barclays Capital, Deutsche Bank, HSBC
Legal advisers: Allen & Overy, Shearman & Sterling, Maples and Calder, Woo Kwan Lee & Lo

Hutchison Whampoa sold $3 billion worth of six- and 10-year bonds in early September as part of a liability management exercise, which at that time also included two buy-back tenders. It was Hutchison's largest bond deal since 2003 and came shortly after a jumbo offering by Petronas, which had unsettled the markets due to its size, tight pricing and disappointing secondary market performance.

The lead managers for the Hutchison transaction had to tread carefully and managed to ease concerns, especially among Asian investors, when it doubled the size of the issue from an initial target of $1.5 billion. They made a round of late calls to several large Asia-based investors to let them know about the increased size, giving them the option to drop out. Apparently, nobody did. As a further precaution, allocations were also skewed towards the US and Europe where the order book was still building when the decision to upsize was made, meaning investors were aware of the situation as they placed their orders. In the end, the transaction raised $2 billion for the six-year tranche, which was re-offered at a 4.658% yield, or 227.5bp over the US Treasury yield; and $1 billion for the 10-year tranche, sold at 5.827%, which was equivalent to a spread of 235bp. Both tranches were priced through the existing Hutchison curve, and traded tighter in the secondary market.

Clearly, Hutchison is a quality name -- it is controlled by Li Ka-shing, Hong Kong's richest tycoon, and its businesses range from ports, telecommunications, property and retail to energy and infrastructure. But the conglomerate and its bankers opportunistically identified maturity gaps on the Hutchison yield curve that suited both the issuer and investors.

Republic of Korea's $3 billion dual-tranche global issue

Lead managers: Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, Bank of America Merrill Lynch, Samsung Securities
Legal advisers: Cleary Gottlieb Steen & Hamilton, Simpson Thacher & Bartlett, Bae Kim & Lee, Kim & Chang

Korea's jumbo sovereign issue in April marked a watershed, setting the benchmark for a flood of issuance by Korean state-owned utilities during the spring and summer, with each issue at a tighter yield spread than the previous one.

It was a clever transaction. By conceding a little on pricing, the republic managed to raise $1 billion more than it had originally intended. Both the equal-sized tranches priced in the middle of initial guidance, ensuring the first successful global placement of Korean sovereign bonds since November 2006. The five-year was re-offered at $99.512 to yield 5.8864%, or 400bp over the five-year US Treasury benchmark, paying a semi-annual coupon of 5.75%; and the 10-year was sold at $99.052 to yield 7.26%, or 437.5bp over the 10-year US Treasury yield, paying a semi-annual coupon of 7.125%.

This was still a difficult time for the Asian credit markets and investors and analysts were by no means convinced that Korea could sustain its recovery from the effects of the global crisis, having suffered a 25% decline in its currency. And it was still burdened with substantial external debt. A cautious pricing strategy was also necessary because investors had come to expect stellar secondary market performances as countries throughout the world struggled to fund recession-beating spending programmes. The republic had to pay a hefty new issue premium of 50bp to 60bp to compensate for that uncertainty, but the rapid narrowing of that spread in the secondary market clearly demonstrated that investors recognised value.

Adaro's $800 million 10-year senior notes

Lead managers: Credit Suisse, DBS, UBS
Legal advisers: Latham & Watkins, Milbank Tweed Hadley & McCloy 

Adaro, Indonesia's second biggest coal miner, raised $800 million with a 10-year issue in mid-October that was both upsized and aggressively priced at a time when Asia's high-yield bond market had barely emerged from an 18-month hibernation. It was the first ever 10-year Indonesian private sector corporate high-yield bond and the largest of any maturity. It paid a 7.75% yield, well below the initial price whisper of above 8%, and attracted an order book worth $5.75 billion from more than 260 accounts around the world. Subsequent high-yield issues had to pay significantly higher yields and couldn't match the size, which was a testament to Adaro's credit-quality, despite its sub-investment grade rating. The spread over the benchmark US Treasury yield was just 430.7bp.

The deal also owed its success to an effective six-day global roadshow, during which the lead mangers persuaded investors that suitable comparisons were recent transactions by higher-rated Australian, Latin American and US mining companies. More positive sentiment towards Indonesia and momentum in European and US high-yield markets didn't harm the deal either. The bonds immediately traded to a premium, reaching a price of 101, although weaker credit markets in the second half of the fourth quarter, plus a flurry of bond launches by other Indonesian miners, caused the issue to trade lower. Nevertheless, all bond houses would have been delighted to have been awarded this particular mandate.

Tata Steel's Rs6.5 billion ($139 million) 10-year unsecured dual-rated bond
Lead manager: Standard Chartered

Tata Steel's bond deal was significant for a number of reasons -- its long tenor, unsecured structure and AA+ dual rating. The transaction was also launched in May, while local markets were awaiting the results of India's parliamentary elections, adding to the uncertainty induced by the global economic crisis. Yet, it managed to achieve Tata Steel's objectives -- the issuer needed long-term funding at a competitive price to protect itself against any medium-term decline in commodity prices -- and at the same time created an innovative financial instrument for a new investor base.

Tata Steel needed to raise a minimum of $100 million (in rupees), but was constrained from offering security by a negative lien clause in its existing loan agreements. While other banks proposed a usual five-year bond, narrowly distributed, Standard Chartered came up with a 10-year bullet issue, which it placed among provident and pension funds that had up until then been a largely ignored investor segment. The dual rating was sought and achieved to enable their participation, and a 10.4% coupon was offered to make that participation enthusiastic. Almost all the bonds ended up with those funds after banks passed on their allocations, and in the secondary market the yield fell quickly to 9.5%, only 50bp more than yields on public sector issues.

Republic of Indonesia's $650 million global sukuk
Joint lead managers and bookrunners: Barclays Capital, HSBC, Standard Chartered
Legal advisers: Allen & Overy; Linklaters; Assegaf Hamzah & Partners; Hadiputranto Hadinoto & Partners

Indonesia issued a landmark debut $650 million sukuk, or Islamic bond, in the middle of the global credit market turmoil, which racked up a lot of firsts. It was the first sukuk since Bahrain sold a $350 million deal in March 2008; it was the first from a country outside the Gulf Cooperation Council since Pakistan in 2005; and only the second Regulation S/144A sovereign sukuk since Malaysia in 2002. It was also the first rated US dollar sovereign sukuk, receiving a Ba3 (stable) from Moody's, BB- (stable) from Standard & Poor's, and a BB (stable) from Fitch.

The deal was more than seven times over-subscribed and priced at the lower end of guidance, despite its April issuance date. And it helped Indonesia, the world's most populous Muslim country, to develop its Islamic finance platform. After all, the government of Indonesia had been keen to issue a dollar sukuk since 2004, but there was no legal framework at the time for such an issue. So, first, the banks had to advise the ministry of finance on drafting a sukuk law (which was passed in 2008). The republic's sukuk was ultimately subscribed by 230 conventional and Islamic investors, domestically and internationally, with widespread distribution by geography and investor type, satisfying Indonesia's objective to both develop the Islamic finance market and tap into new pools of liquidity, in particular in the Middle East.

IFC's $50 billion Global Trade Liquidity Programme
Lead grantor: Standard Chartered

In the weeks and months immediately following last year's credit crunch, specialists estimated that there was a shortfall of as much as $100 billion in global trade financing. Responding to this, Standard Chartered Bank acted as the first lead grantor bank to the International Finance Corporation and other governmental institutions' global trade liquidity programme, a $50 billion facility designed to support incremental trade flows. A global public-private partnership, the programme improved access to trade-related loans for buyers and sellers. While not the only bank to ultimately participate in the programme, Standard Chartered's early involvement and its $1.25 billion facility are noteworthy examples of the bank's ability to quickly respond to changes in global economic conditions and meet the rapidly shifting needs of its trade customers.

The impact of the programme is difficult to measure but because of it, and other actions taken by governments, trade finance document pricing has been brought down to the 100bp range from a high of 300bp to 500bp during the worst of the economic malaise last year -- compared to around 30bp previously. According to Standard Chartered, its facility has improved access to liquidity for more than 30,000 traders.

Deutsche Bank's regional treasury solution for Henkel Group

Regional cash management solutions are the norm rather than the exception at today's major corporations. However, the occasional multi-country solution stands out from the pack for its size and complexity -- Deutsche Bank's 12-country solution to automate and standardise Henkel Group Asia-Pacific's payment processes is one such solution. It is notable because implementation occurred immediately after Henkel's 2008 acquisition of US-based National Starch, a merger that increased the group's Asia-Pacific turnover by half, from 8% of total global revenue to 12%.

Deutsche had to integrate payables and receivables from two different enterprise resource planning (ERP) systems, consolidate operating accounts and optimise liquidity across the region, including in countries with restrictions on capital repatriation. The bank proceeded to integrate the group's ERP systems through its db-direct internet platform, open accounts and set up an automated cross-currency, cross-border cash pool. Implemented in less than eight months, the solution has improved the efficiency of Henkel's treasury, while simultaneously reducing its operating costs.



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