Fitch: European funding trends in 2015

Author: Gemma Varriale | Published: 19 Jan 2015

Post-crisis regulation will continue to be a key driver of structural changes in funding across Europe in 2015, according to rating agency Fitch.

Bank disintermediation has been a key trend in Europe, with companies that would once have looked to banks for funding increasingly turning to the region’s bond markets.

Constrained bank balance sheets, resulting from Basel III’s beefed-up capital requirements, and receptive financial markets, have diversified funding options for European companies, continuing the broader trend of disintermediation of corporate funding in Europe.

In the last year we’ve started seeing many deals being funded entirely by bonds, said Monica Insoll, managing director in Fitch’s credit market research group. "Only a few years ago you’d never see that in Europe," she added. "This is also a sign of how the bond markets are maturing and becoming a real competitor to the loan market."

"2014 had the...