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CEEMEA primary bond market volumes for 2022 cannot be described as anything but appalling. By mid-November, with only a small amount still expected to be issued before the end of the year, there had been just $109.51bn printed, compared with a full year total of $257.59bn in 2021, according to Dealogic data.
Citi was triumphant at the top of Dealogic’s CEEMEA league table of bookrunners, taking its usual dominant position alongside JP Morgan.
“The EM bond business in CEEMEA remains largely a two horse race, and there is a big gap between those banks and banks three, four and five in the league tables,” says Tommaso Ponsele, co-head of European corporate and CEEMEA DCM at Citi in London.
Not one bank in the top 10 for 2022 was in same position at the end of 2021. First Abu Dhabi Bank and Bank of America fell out of the top 10 entirely in 2022, replaced by Erste Bank and Barclays.
The reasons for the changes in positions and volumes are not straightforward. One obvious factor was the removal of all potential Russian and Ukrainian bond business in February. In 2021 there was $20.94bn of bond business just from Russia alone, and a further $3.89bn from Ukraine.
The CEEMEA bond houses that were especially strong in these countries suffered an immediate blow. Though many of the Russian bonds were already being placed by local Russian houses such as VTB Capital because of previous rounds of sanctions, some international banks were still active. JP Morgan had in 2021 been third for that business, for example. Citi was only fifth, which may go some way to explaining how Citi looks to have nabbed the CEEMEA crown from JP Morgan in 2022.
Can’t print, won’t print
Another factor was the rocketing yields in Turkey, linked to unorthodox monetary policy and high inflation, which meant that apart from the sovereign the only other two issuers to tap the market from that country in 2022 were Coca-Cola Içecek and Istanbul.
The sharp rise in US Treasury yields throughout the year meant...