Early year optimism appears to have stabilised markets in the near term. This has been helped significantly by the European Central Bank (ECB) Long Term Refinancing Operation, that saw almost €500bn of three-year money lent to European banks, with a second opportunity for banks to borrow again in February.
Volatility remains a central theme and even companies with a good story to tell will have to be much more creative to meet their financing requirements, exploring the liquidity available in the fragmented alternative credit market.
This fragmented market will create challenges for CEOs and CFOs more used to dealing with relationship bankers. As non-bank funders play an increasingly important role they offer companies an important source of additional liquidity. This liquidity comes at a higher price point, but it also comes with more flexibility across other commercial terms.
Our Debt Markets and Debt Brokerage businesses are regularly speaking to over 150 investors. As fragmentation continues, reach and scale will be key to accessing this investor base. In these volatile times, we urge CEOs and CFOs to plan early and develop detailed funding contingencies