NEWSLETTER of April 2, 2021

The following content has been added at finexpert:

PwC
GLOBAL CRISIS SURVEY 2021
How did companies behave during the COVID 19 pandemic? What did they learn in the process? And how do you use the new insights to prepare for crisis situations in the future? These are some of the key questions explored by PwC's Global Crisis Survey 2021. Between August 20, 2020 and January 25, 2021, we surveyed more than 2,800 executives from 73 countries and 29 industries, including 158 companies in Germany. The responses provide exciting insights into which strategies, measures and technical solutions companies relied on during the pandemic - and which of them were effective or not. >more

KfW
SCHULDENTRAGFÄHIGKEIT NACH CORONA – AUF DIE ZINSEN UND DAS WACHSTUM KOMMT ES AN
As a result of the Corona crisis, public debt has risen significantly worldwide. But how sustainable is the accumulated debt? This paper uses the examples of Germany and Italy to analyze the prospects for reducing government debt ratios. The focus is on the longer-term development from 2023, when both the recession and the immediate recovery phase are expected to have come to an end. >more

Deloitte
DISTRESSED M&A-STUDIE 2021
The Deloitte Distressed M&A Study 2021 reflects the expectations and assessments of experts from the areas of financing (equity and debt), restructuring and insolvency on the economic and industry development as well as on current trends in the distressed M&A market, taking into account the COVID 19 pandemic. For this purpose, we surveyed more than 2,000 experienced practitioners for their assessment. The aim is to obtain an informed view of the situation in the German market and to identify trends and possible changes. >more

Bank for International Settlements
BIS QUARTERLY REVIEW: MARCH 2021
Markets have been wrestling with reflation prospects in recent months. Prospects of a more robust economic recovery buoyed risky asset prices, with signs of exuberance reflected in retail investors' behaviour. Sovereign yield curves steepened as investors priced in higher inflation and fiscal support. The search for yield underpinned the broadly positive sentiment towards emerging market assets, particularly in East Asia. >more

OECD
STRENGTHENING THE RECOVERY: THE NEED FOR SPEED
Activity in many sectors has picked up and partially adapted to pandemic restrictions. Vaccine rollout, although uneven, is gaining momentum and government stimulus, particularly in the United States, is likely to provide a major boost to economic activity. But prospects for sustainable growth vary widely between countries and sectors. Faster and more effective vaccination deployment across the world is critical. Prospects have improved over recent months with signs of a rebound in goods trade and industrial production becoming clear by the end of 2020. Global GDP growth is now projected to be 5.6% this year, an upward revision of more than 1 percentage point from the December OECD Economic Outlook. World output is expected to reach pre-pandemic levels by mid-2021 but much will depend on the race between vaccines and emerging variants of the virus. >more

BREXIT AND THE CONTRACTION OF SYNDICATED LENDING
Tobias Berg, Anthony Saunders, Larissa Schäfer, and Sascha Steffen
2020
We document a 24% decline in loan issuances in the UK syndicated loan market after the Brexit vote relative to a set of comparable loan markets. The decline in lending is driven by a pervasive reduction in demand by UK firms. Changes in GDP forecast around the Brexit vote explain about 61% of the decline in lending. We do not find evidence, however, that the UK loses its attractiveness as a financial center for cross-border lending. Our results point to the resilience of global financial centers in the face of large unexpected shocks. >more

CORPORATE BOND ETFS: INNOVATIVE, BUT NOT INCONSEQUENTIAL
Caitlin D. Dannhauser, and Saeid Hoseinzade
2020
Relative to mutual funds, the innovative features of ETFs attract high liquidity demand investors who engage in positive feedback strategies and transmit selling pressure to the underlying via near proportional trading. In a turmoil period we find evidence that ETFs destabilize the systemically important corporate bond market, but no such evidence is found for mutual funds. Comparing two bonds from the same issuer, we find that the yield spread of bonds with greater ETF selling pressure increases temporarily. Arbitrage activity through in-kind redemptions in the largest most liquid ETFs propagates ETF selling pressure from the exchange to the underlying bonds. >more