Table of Contents

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01 Executive summary

Industry overview

  • Industry structure
    • Consolidation and contraction
    • Bulge-bracket players
    • Hedge funds
    • The revolution in credit
  • Business strategies
    • Market positioning - niche vs supermarket
    • Differentiation and distribution
    • Product positioning - mass-market vs tailored approach
    • Client segmentation and relationship management
    • Relationship lending
    • Organisational re-engineering
    • Increasing efficiency
    • Cost competition
    • Electronic execution

Chapter 1

Introduction

  • The global battle for competitive advantage
    • Structured solutions
    • Organisational streamlining, focused hiring
    • The European theatre
    • Cultural shifts
    • Leadership issues
  • The incentive: US$75bn of fees
  • The competitive landscape
    • Top-end consolidation
    • Exit second-tier players?
    • Buy-side contraction
    • Building up prime brokerage
    • Corporate customer consolidation
    • Commoditised vs client-focused strategies
    • Viewpoint: Dynamic business planning - CEO, European investment bank
    • Cost competition
    • Fee cutting: push or pull?
  • Electronic execution and DMA
    • Viewpoint: Electronic trading
    • is an innovative dilemma - Global Co-head of Trading, leading investment bank
    • Viewpoint: Technology enables focus on tailored solutions - Tom Kalaris, Barclays Capital
  • The revolution in credit
    • Development of risk transfer
    • Growth of structured credit
    • Market repricing

Chapter 2

Investment banking at a crossroads

  • New structures, new models, new focus
  • Cleaning up its act
    • Ethics and controls
    • Professional management and better oversight
  • Organisational re-engineering
    • From product silos to integrated solutions
    • Viewpoint: Specialisation model - CEO, leading global investment bank
    • Viewpoint: Integration model - Head of Investment Banking, leading global firm
    • Changing mindsets . . .
    • . . . Or cutting costs?
    • Bedding in the integration model
  • Merger fever
  • Bankers’ conservatism boosts consultancies
  • Do clients want organisational re-engineering?
    • Viewpoint: Client relationships, continuity and consistency - senior investment banker, leading firm
    • Relationships and continuity

Chapter 3

Niche vs supermarket strategies

  • Commercial vs investment banks
  • Investment banking strengths
  • Investment-grade and leveraged lending
  • Advisory - the marquee business
  • The limitations of supermarkets
  • Global bulge-bracket players
  • Regional/modified-global
  • Bulge-bracket
  • Smaller-scale players
  • Japanese firms
  • European firms
    • Winners and losers
  • Global customers want global firms
    • Smaller-scale firms under pressure
    • Exit strategies

Chapter 4

Relationship lending and client targeting

  • Relationship lending
    • Viewpoint: A broader view of the lending relationship - CEO of the investment banking division of a leading US firm
    • Viewpoint: Building and maintaining client relationships - global head of sales and trading, leading global firm
    • Narrow margins
    • Corporate borrowing
    • A one-sided relationship
    • The need to manage the risk and the relationship
    • Viewpoint: Risk management and relationships - CEO of the corporate and investment division of a leading European bank
  • Client targeting
    • Viewpoint: Client targeting - Chief executive, leading investment bank
    • Getting the right fit
    • Client segmentation
    • Key focus areas
    • Targeting for the future
  • Differentiation and distribution
    • Identical differentiation?
    • Optimum distribution
    • Practical changes
  • Advantages for global players
    • Viewpoint: UBS’s
    • Differentiation strategies
    • Network breadth
    • The continuing quest for global differentiation

Chapter 5

Hedge funds and prime brokerage

  • Hedge funds
    • Market dominance
  • Fund derivatives
    • Prime brokerage
    • Moves by second-tier players
    • Future investment in prime broking
  • Proprietary trading: embedded conflict at play
    • Viewpoint 1: For prop trading - Global head of fixed-income at a major firm
    • Viewpoint 2: For prop trading - Global head of equities at a major firm
    • Viewpoint 3: Against prop trading - CEO of a major investment bank

Text tables

  • Table 1.1: Top 10 M&A, ECM, DCM 2005
  • Table 1.2: Largest global investment managers, 2003 (US$ bn)
  • Table 1.3: Global assets under management, 2004 (US$ bn)
  • Table 3.1: US investment-grade lending, 2005 (US$m)
  • Table 3.2: Investment banks in Top 25 US investment-grade lending, 2005 (US$m)
  • Table 3.3: US leveraged lending, 2005 (US$m)
  • Table 3.4: M&A - advisory position vs fees, 2005 (US$m)
  • Table 3.5: Global bulge-bracket players
  • Table 3.6: Domestic vs international contribution, 2004
  • Table 3.7: Top 50 euro bond underwriters, 2005 (€m)
  • Table 3.8: Top 25 EMEA syndicated loan bookrunners, 2005 (US$m)

DCM league tables

  • Global Debt incl. MBS, ABS & US Tax Munis 2005 (B1)
  • Global High Yield Debt - Top 25 Bookrunners 2005 (B4)
  • Global Bond Fees incl. MBS, ABS, and US Tax Munis 2005 (B1)
  • US High Yield Debt - Top 25 Bookrunners 2005 (B5)
  • Global Mortgage-backed Securities - Top 25 Bookrunners 2005 (B10)
  • Global ABS - Top 25 Bookrunners 2005 (B11)*
  • Global CDOs - Top 25 Bookrunners 2005 (B12)
  • US Domestic Bonds - Top 25 Bookrunners 2005 (F6)
  • US Investment-Grade Bonds (Corporates and Financials) - Top 25 Bookrunners 2005 (F6a)
  • US MBS - Top 25 Bookrunners 2005 (F11)
  • US ABS - Top 25 Bookrunners 2005 (F14)
  • All International Bonds - Top 25 Bookrunners 2005 (J1)*
  • International Securitisation - Top 25 Bookrunners 2005 (J10c)*
  • All Bonds in euros - Top 25 Bookrunners 2005 (N1)
  • Australian Dollar Bonds - Top 20 Bookrunners 2005 (AJ3)
  • Asian Currency bonds - Top 25 Bookrunners 2005 (AS1)
  • Asia Pacific International Bonds - Top 25 Bookrunners 2005 (AR2)
  • Emerging Market Bonds - Top 25 Bookrunners 2005 (L1)
  • EEMEA Emerging Market Bonds - Top 25 Bookrunners 2005 (L2)
  • Latin American International Bonds - Top 24 Bookrunners 2005 (L3)
  • Asian International EM Bonds - Top 15 Bookrunners 2005 (L4)

M&A league tables

  • Worldwide M&A Completed Deals - Top 25 Advisors 2005 (AF1)
  • Worldwide Completed M&A - Imputed Fees 2005(AF1)
  • Completed M&A 2005:
  • Any US Involvement (AF48)
  • Deals with US Target (AF2)
  • Any European Involvement (AF3)
  • Any UK Involvement (AF39)
  • Any French Involvement (AF40)
  • Any Spanish Involvement (AF41)
  • Any German Involvement (AF42)
  • Any Italian Involvement (AF43)
  • Any Nordic Involvement (AF44)
  • Any Benelux Involvement (AF47)
  • Any Australian Involvement (AF31)
  • Any Latin American Involvement (AF45)
  • Any Asian (ex-Japan) Involvement (AF32)
  • Any Japanese Involvement (AF23)
  • Any Canadian Involvement (AF49)

Syndicated loans league tables

  • Global Syndicated Loans - Top 25 Bookrunners 2005 (R1)
  • Global Syndicated Loans fees - 2005
  • US Syndicated Loans - Top 25 Bookrunners 2005 (R11)*
  • US Leveraged Loans - Top 25 Bookrunners 2005 (R11a)*
  • US Investment Grade Syndicated Loans - Top 25 Bookrunners 2005 (R11b)*
  • Latin American syndicated loans - Top 10 Bookrunners 2005 (R15)
  • EMEA Syndicated Loans - Top 25 Bookrunners 2005 (R17)*
  • European Leveraged Loans - Top 10 Bookrunners 2005 (P10)
  • EMEA Sponsored Loans - Top 25 Bookrunners 2005 (P13)
  • Australian syndicated loans - Top 25 Bookrunners 2005 (S7)
  • Japan Syndicated Loans - Top 25 Bookrunners 2005 (S12b)
  • Asian Syndicated Loans - Top 25 Bookrunners 2005 (S5c)*

ECM league tables

  • Global Equity and Equity-related 2005 (C1)
  • Global Equity & Equity Related Last Full Year (C01)
  • Global Common Stock 2005 (C2)
  • Global IPOs 2005 (C5)
  • Global Convertibles 2005 (C9)
  • US Equity, Equity-related
  • 2005 (C1a)
  • US Common Stock 2005 (C3)
  • US IPOs 2005 (C6)
  • US Convertibles 2005 (C9a)
  • EMEA Equity, Equity-related. Rights and Open Offers 2005 (C1dr)
  • EMEA Common Stock. Rights and Open Offers 2005 (C4cr)
  • EMEA IPOs 2005 (C7c)
  • EMEA Convertibles 2005 (C9d)
  • Japanese Equity, Equity-related 2005 (C1e)
  • Japanese Common Stock 2005 (C4d)
  • Japanese IPOs 2005 (C7d)
  • French Equity, Equity-related. Rights and Open Offers 2005
  • German Equity, Equity-related. Rights and Open Offers 2005
  • UK Equity, Equity-related. Rights and Open Offers 2005
  • Spanish Equity, Equity-related. Rights and Open Offers 2005
  • Italian Global Equity, Equity-related. Rights and Open Offers 2005
  • Eastern Europe Equity, Equity-related. Rights and Open Offers 2005
  • Benelux Equity, Equity-related. Rights and Open Offers 2005
  • Nordic Equity, Equity-related. Rights and Open Offers 2005
  • Australian Equity and Equity-related 2005

Section 02

Organisational profiles

Introduction

  • The IFR 17
  • Strategic diversity
  • Organisational development
  • Focus
  • Trading-driven profits

ABN AMRO

  • Business strategy
    • New organisational structure
    • Derivatives push
    • New WCS structure
    • International operations
  • Financial results 9M04-9M05

Bank of America

  • Business strategy
  • International business strategy
    • Leveraging the universal bank model
    • International build-out
  • Financial results 9M05

Barclays Capital

  • Business strategy
    • Business growth
    • Adding scale
    • M&A
    • Equity derivatives
    • Commodities
    • FIG and corporate
  • International operations
  • Financial results H104-H105

BNP Paribas

  • Business strategy
  • International operations
    • Structure
    • Ongoing strategy
  • Financial results

Citigroup

  • Business strategy
    • Premier financier
    • Secondary lagging
    • GCIB priorities
    • Growing equities
    • Internal issues
  • Financial results

Credit Suisse

  • Business strategy
    • A chequered history
    • Structure
  • International operations
  • Financial results

Deutsche Bank

  • Business strategy
    • Objectives of global structure
    • Trading investment and innovation
    • Client-focused
    • Market performance
    • Growth strategies
    • Business realignment
  • Financial results Q305

Dresdner Kleinwort Wasserstein

  • Business strategy
    • Domestic focus
    • Internal restructuring issues
    • Uncertainty rules
  • Business expansion
    • Market positioning
  • Organisational evolution
  • Financial results 9M04-9M05

Goldman Sachs

  • Business strategy
    • Market performance
    • Advisory strengths
    • Integrated model
    • Organisational evolution
    • Partnership culture
    • Issues of conflict
  • Financial results 2005

HSBC

  • Business strategy
    • Structure
    • Increasing cost base
  • International operations
  • Financial results H105

JPMorgan

  • Business strategy
    • Investment bank operations
    • Staff movements
    • Market performance
  • International operations
  • Financial results 9M05

Lehman Brothers

  • Business strategy
    • Integrated organisation
    • Expansion targets
    • Market performance
  • International operations
    • Executive moves to promote growth
    • Operational success
    • Future strategy
  • Financial results 2005

Merrill Lynch

  • Business strategy
    • Strong performance
    • Structure
    • Market performance
  • Growth strategies
    • Commodity trading
    • Identifying growth areas
  • Financial results Q305

Morgan Stanley

  • Business strategy
    • Strategic priorities
    • Market performance
  • Financial results 2005

RBS

  • Business strategy
    • Corporate Markets division
    • Further segmentation
    • Expansion plans
    • Internal performance
    • Product portfolio
    • Market performance
  • International operations
    • Europe starting from scratch
  • Financial results H105

Société Générale

  • Business strategy
    • Strong financial performance
    • Derivatives strength
    • Beyond equity derivatives
    • Development plans
    • Market performance
  • Financial results 9M05

UBS

  • Business strategy
    • Major restructuring
    • Growth strategies
  • International operations
    • Growth and integration
    • US development
    • Market performance
  • Financial results 9M05 vs 9M04
    • Volatile trading conditions in early 2005