Risks of recession and deflation have subsided, and a cyclical upturn is probable in the next six to nine months, but a strong and sustained global recovery is unlikely, and medium-term growth will remain subdued. In the UK, growth prospects have improved. However, overall, performance remains mediocre, and sharply worsening public finances highlight serious medium-term risks for the economy.
These are a selection of loans announced recently. The details, updated to the middle of last month, were supplied by Thomson Financial Securities Data and other sources.
Consultations on FSA reform
The FSA has published a consultation paper containing wide-ranging and radical proposals for reforming the Listing Regime for equity, debt and financial products.
Relationship banking has been with us for years, even centuries. In spring 1728, with The Royal Bank of Scotland (RBS) less than a year old, a customer came to us with a problem.William Hogg, a merchant in the High Street of Edinburgh, was not unique. He bought and he sold – and that meant there were times when he had enough money and times when he did not. He did not want to borrow a fixed sum for a fixed period – the existing form of borrowing – he wanted something more flexible, borrowing only what he needed, when he needed it, and moreover paying for it on that basis.
The convertible bond (CB) markets are nothing new to UK companies. The benefits of CB issuance are well-known: low interest costs and equity issued at a premium. However, there was a time when plain vanilla convertible bonds were a company’s only equity-linked fund-raising choice, and fears of dilution and loss of shareholder value dominated UK plc’s perception of CBs. Over the past three years the UK convertible market has evolved tremendously in the issuer’s favour, both in terms of attractive pricing and flexibility of structure.
As David Creed, Chairman of the recent 2003 Association of Corporate Treasurers (ACT) Pensions Conference pointed out, the signs of the problems ahead were already apparent at last year’s conference. Low interest rates and higher wages were driving up the net present value of future pension liabilities.
Cash management in Electrocomponents at the end of 1999 was a decentralised affair. In the UK, there was a notional cash pool with the main clearing bank, in which sat all the UK operating and holding companies. Group treasury managed the balance on this pool with deposits/borrowings to/from the London money market. Some of the other overseas operating companies had cash balances (which, for various reasons, could be substantial) that they largely managed locally, albeit under guidance from the centre in terms of credit exposure. The borrowing companies were financed with a range of inter-company and external debt, again largely driven and managed locally. It was not very efficient at all. Not only was there a significant loss of interest, but there was also a loss of central control and a lot of local management time was being wasted. A process was initiated to review cash management, currency by currency, starting with the euro first.
The fifth JPMorgan Fleming International Cash Management Survey, which has recently been completed in conjunction with the Association of Corporate Treasurers (ACT), once again provided a valuable insight into current trends in cash management with some very interesting results.
Being a group of small sovereign countries in close proximity to each other helped Europe to develop into one of the most politically and culturally diverse regions in the world. While this variety undoubtedly helped the region to become a leader in arts, ideas and business, it also made the day to- day mechanisms of inter-country trade and commerce extremely complicated.
Like their peers on other floors of corporate headquarters, executives in the treasury, accounts payable and accounts receivable departments are under considerable pressure to cut costs, operate more efficiently and generate more revenue.
The ACT Annual Dinner took place at the Grosvenor House Hotel, Park Lane, London, on Wednesday 12 November. Baron Alexandre Lamfalussy (pictured), the man who was both Europe’s first ‘central banker’ and then responsible for much of the work on the regulation of European securities markets, was the guest of honour and provided the 1600 members and their guests with his vision for the economic future of Europe.
Treasurers Lucy Fuller of Smith & Nephew, Bob Williams of Allied Domecq and Piers Williamson of the Housing Finance Corporation give their views on the economic outlook for the year ahead.
What lies ahead for the world economies in 2004? How will the main currencies perform? At the end of a turbulent year we asked five of the UK's foremost economists for their predictions...
The Treasurer asks a selection of experts in the loans markets to provide us with their forecasts for 2004.
After a reasonably positive year in the bond markets, we asked the experts for their predictions for 2004. Pippa Mason of Citigroup and Nick Medd of HSBC provide their forecasts.
Equities rallied during 2003 but will the surge continue throughout 2004? And after a tough first six months for IPOS, is confidence returning? We asked two equities experts, Greg Chamberlain of Cazenove and Kevin Gardner of HSBC for their views.
Next year sees a major development within Europe. On 1 May 2004, 10 countries – Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia – will join the European Union (EU) and create a market of 25 countries and 450 million people.
