Trends and market positioning in the newly added units

Structured Finance & Syndications Austria /CEE

As in previous years, the market environment for structured finance and syndicated loans in Austria and CEE continued to show strong growth in 2006. Despite growing competition from international players which are increasingly turning their attention to the most attractive growth markets in Eastern Europe (especially Russia, Turkey and Poland), BA-CA maintained its position among the market leaders in structured finance and corporate lending. UniCredit Group ranked third in the league table of arrangement mandates for syndicated loans in CEE (incl. Russia and CIS), in terms of both volume and number of mandated transactions. After 55 syndicated loans signed in 2005, the number of comparable transactions concluded in the region in 2006 reached 74, an increase of about 35%. These were loans to companies, banks and sovereign borrowers.

This favourable development is largely attributable to the strong growth of acquisition finance activities in CEE. Supported by excellent, long-standing contacts with all major financial investors and private equity companies active in Europe, BA-CA was again successful in structuring and placing a number of important transactions of this kind for international financial investors.

In 2006, syndicated bank loans in CEE, Russia and the CIS accounted for about 50% of all transactions on the international credit market. The most significant such transactions of BA-CA took place in Ukraine (Privatbank, USD 250 m) and Kazakhstan (Bank TurenAlem, USD 777 m, and Kazkommertsbank, USD 1 bn). This is a business area where BA-CA has for many years been among the top arrangers for syndicated loans for financial institutions in CEE and the CIS.

In Austria, BA-CA had a market share of 22.8% in terms of the volume of all arranged transactions. This is almost twice as high as that of our closest competitor.

CA IB Corporate Finance

Within UniCredit Group, CA IB Corporate Finance is responsible for strategic corporate finance advisory, equity capital markets and merchant banking origination services, and acts on behalf of the Group in Austria and Central and Eastern Europe. In 2006, CA IB achieved its best result ever, with transaction volume exceeding € 10 bn.

In Corporate Finance Advisory, which accounts for 70% of CA IB’s total revenues, CA IB participated in over 100 projects in 15 countries. Significant transactions included the sale of Splitska banka (€ 1 bn) on behalf of UniCredit Group. CA IB also successfully advised Knauf on the acquisition of Heraklith (€ 230 m), and the Czech energy company CEZ on the acquisition of a Bulgarian thermal power station (€ 306 m) and two Polish power plants (€ 383 m). CA IB was again honoured with numerous awards in 2006.

These included “Best Investment Bank in CEE” by the magazine Finance New Europe, and “Best Continental M&A Adviser” by the periodical Acquisitions Monthly.

In the area of equity issues, CA IB once again successfully placed shares in Austria and in Central and Eastern Europe (please refer to the section “New issue business”).

Equity capital market – book runners 2006
Austria and CEE