The most relevant deals carried out by the different CIB departments and the highlights of the fourth quarter of 2013 are summarized below.
The Merger & Acquisitions unit, which specializes in the corporate finance business, maintains its leading position in Spain as M&A financial advisor. The most important deals in the fourth quarter were the sale of Sarenet, by Vocento and a private investor, to Springwater, the sale of 5% of CLH to Ardian and the issue of a fairness opinion on Novartis for the Board of Directors of Grifols. In Mexico, this unit has also performed strongly. The unit has advised Suez Environment and the Peñoles group in the sale of 50% of DHC to GMD, and advised Colfax in the acquisition of 56% of the Sicelub Lubritech group.
In Equity Capital Markets, BBVA has taken part: as co-manager in the IPO of CTT, Portugal’s postal services company, and as underwriter in the Barclays capital issue with subscription rights. In Mexico the unit led the initial public offerings of Fibra Danhos, Grupo Lala and CKD de Artha. It also took part as book runner in the Actinver share capital increase. In Chile the unit led the share capital increase with subscription rights of Quiñenco.
In Corporate Lending, BBVA continued to lead the most important deals on the Iberian market (syndicated loan to Enagas, bridge to bond for Grupo Antolin, funding to Grifols for the acquisition of a Novartis division, among others). In Europe, BBVA won the Dufry International AG deal and acted as joint-book runner in the HY bond for the Italian company Astaldi. In Latin America, BBVA led the financing of acquisitions of CFR in Chile, American Tower and Alsea in Mexico and Hochschild in Peru. In the United States, BBVA Compass has arranged credits for Chicago Bridge & Iron and Colfax.
In Project and Leveraged Finance, BBVA has advised Saba on the concession of parking lots for Adif railroad stations and the University of Granada for funding an entrepreneur center. It also took part in the structured syndicated deal for Aliseda, a real-estate management company belonging to Banco Popular. Worth mentioning in Latin America are the asset financing transactions for Gasoductos de Chihuahua and the Playa Hotels Project in Mexico, the Port of Callao in Peru and the funding for the acquisition of Globenet in Brazil. In the United States, BBVA acted as joint lead arranger, co-documentation agent and hedge provider in the NET Mexico pipeline for ArcLight and NET Midstream.
In Global Transaction Banking, credit facilities have been concluded with two Spanish companies for the construction of the North Tarrant highway in Dallas; a hedging policy has been arranged for the issue of three advance payment bonds for the construction of the Riyadhy subway, and two stand-by letters of credit have been issued for a major air carrier, to guarantee the purchase of two fuel ships. In Mexico, BBVA was selected to manage the accounts receivable and payable of the country’s main vehicle insurance company. Worth mentioning in new products and functionalities in Europe are the presentation of the new App “BBVA net cash” for mobile devices and the “SEPA File Test”, which enables users to check SEPA collection and payment forms before sending orders. Lastly, the Global Custodian magazine has named BBVA “Top Rated” in the “Agent Banks in Major Market Survey 2013”.
Global Markets ended 2013 with a significant increase in annual gross income of 26.1% to €1,282m euros. This increase is largely the result of its customer-centric business model, whereby customers are able to make the most of the business opportunities that arise, within the broad range of markets in which BBVA operates. It also carefully examines the sustainability of each proposal using stringent risk control and an efficient use of liquidity. The success of the Global Markets strategy has been recognized by a number of awards. For example, Euromoney recently ranked BBVA CIB as the “Best Investment Bank in Spain” and Latin Finance chose BBVA Bancomer as the “Best Investment Bank in Mexico”.
By geographical areas, in Europe there has been excellent performance in the equity business and increased activity in the global public finance segment (up 73% year-on-year).
In Spain, BBVA is once again at the top of the Spanish Stock Market ranking, with a market share of more than 18%, and is the leader in debt capital markets, with a market share of 14% in total issues and 24% in public sector issues. Structured Products has also ranked it as the “Best Financial Institution in Spain for Structured Products”.
In Asia, BBVA’s strong activity with corporates stands out (up 12% year-on-year), as does its credit revenue growth (up 14%).
In Mexico, Global Markets has consolidated its leadership in the country and has reported positive performance in customer revenue, thanks to the synergies with the networks. By product, equity brokerage revenue has been outstanding (up 74% year-on-year).
In South America, the strong performance in foreign exchange revenue (up 67% year-on-year), and the growing penetration both in the institutional customers (up 6%) and corporates (up 11%) segments are particularly noteworthy.
In the United States there has been a significant increase in the contribution from the institutional customers segment (up 45% year-on-year in revenue).