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Corporate Bond Issuance in Euroclear International Securities Services Philippe Laurensy, Euroclear Euroclear Collateral Conference May 2014.

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Presentation on theme: "Corporate Bond Issuance in Euroclear International Securities Services Philippe Laurensy, Euroclear Euroclear Collateral Conference May 2014."— Presentation transcript:

1 Corporate Bond Issuance in Euroclear International Securities Services Philippe Laurensy, Euroclear Euroclear Collateral Conference May 2014

2 2 Agenda Corporate Bond Issuance Evolution Euroclear as Issuer CSD Issuance overview through Euroclear

3 3 Corporate Bond Issuance Evolution

4 Financing Options Advantages Disadvantages Raise Equity Performance driven profit sharing No fixed costs Small cap markets Competitive pricing Corporate governance Bank Financing Flexible borrowing Well established market Acknowledged expertise Predictable cash flow Banks deleveraging Rates set by lender Reduced lending appetite due to increased capital costs Syndicated loans less liquid Capital Markets Sophisticated and more liquid market Robust Investor base Predictable cash flow Tax effectiveness No influence on corporate governance Increased regulation Limited access for small/lower rated issuers 4

5 5 Growth of International Corporate Bonds Source: Source: Dealogic Nov Outstanding volumes in EUR equivalent millions International debt (Dealogic definition): where the borrower is an off-shore entity or if the security is governed by the rules of more than one market or when the security is a cross-border instrument Bond Issuance GloballyBond Issuance with Euroclear Group

6 Corporate Bond Issuance Corporate entities will continue to be the main drivers of economic growth in the medium and long term What do you need ? Lowest possible cost of funding Secure funding Large scope of instruments Low cost to market 6

7 Corporate Bond Issuance Financial markets bring together: ► Issuers seeking funding to meet their business targets ► Investors seeking investment returns with well established cash flows Business growth results in: ► Expansion from domestic to international market focus ► Increasing multi-currency funding needs ► The search for a broader investor base International bond markets facilitate cross border participation and trading flexibility for market participants, globally 7

8 Euroclear as Issuer CSD 8

9 ST008 >99% European domestic debt coverage >99% European domestic debt coverage 2013 data Euroclear Group Today >900,000 Securities covered >900,000 Securities covered >€24 trillion Assets in custody >€24 trillion Assets in custody 53 Settlement currencies 53 Settlement currencies >€700 billion Collateral Highway transactions daily >€700 billion Collateral Highway transactions daily >2000 Institutional clients from 90 countries AA+ Rating by S&P and Fitch for the past 10 years AA+ Rating by S&P and Fitch for the past 10 years >1 million Transactions settled per day >1 million Transactions settled per day >€570 trillion Transactions settled >€570 trillion Transactions settled 9

10 We serve clients in their own language across all time zones Euroclear Around the World… 10

11 11 Issuance Overview through Euroclear 11

12 Why International Securities ? Benefits 12 Corporate issuers Your investors Lowest cost of funding Large customer base and direct access to the buy side Robust and well accepted procedures for all asset classes, including multi-listing, multi- currency, multi-governing laws Simultaneous offering to worldwide global investors Single point of contact / relationship for the issuer for ease of information and process flows Full asset servicing for coupon payments, tax certifications, legal certifications, corporate events, etc Full asset optimisation to leverage triparty and banking services Single point of entry to global range of trading partners Internationally recognised asset protection Low cost to market

13 LocalWorldwide Limited to local jurisdiction and governing laws Limited currencies or swaps required Multiple agents required for issuance and asset servicing Limited investor base One standard for multi legal jurisdiction and framework Raise funds in the currency of your choice Single agent point of contact through lifetime of security International investor access Why Euroclear? 13 We help you move from a local to a worldwide issuance and investor base target

14 How to Issue International Securities ? Involve Euroclear when discussing your new issues with your legal counsel and arrangers Let us know what is important to you: ► Worldwide distribution ► Multi-currency options ► Business intelligence 14 We will assist you in finding the optimal structure for your needs

15 Issuance regulations we handle Sec Reg Reg S / 144A 144A 3c7 REG D Issuance regulations we handle Sec Reg Reg S / 144A 144A 3c7 REG D International Securities A wide range of financial instruments Fixed Income (in Nominal): Medium Term Notes (MTNs) (Euro) Bonds (Euro) Commercial Paper (Euro) Certificates of Deposit Notes Convertible Collateralised Debt Obligations Collateralised Mortgage Obligations Asset Backed Securities Mortgage Backed Securities Global Depositaries Notes Reverse Convertible Bonds Equity Linked Notes Risk Linked Notes Treasury Bills Debentures Extendable Bonds Sukuks (Islamic Financing) 15

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