NEWSLETTER of August 13, 2021

The following content has been added at finexpert:

KfW Research
DIE BEDEUTUNG VON ONLINE-KREDITPLATTFORMEN IM MITTELSTAND: DIGITALE FREMDFINANZIERUNG NOCH NISCHENPRODUKT
Digitization is not stopping at corporate financing. It is now possible to arrange financing via online lending platforms offered by digital providers on the Internet. The KfW SME Panel shows that loan financing via online lending platforms is still a major exception among SMEs. In 2018 and 2019, around 77,000 SMEs used this financing alternative with a total volume of EUR 3.4 billion. As a rule, these were low financing volumes. However, there is a (very) small segment of companies that make very heavy use of lending platforms. >more

ValueTrust
DACH CAPITAL MARKET STUDY: JUNE 30, 2021
ValueTrust, finexpert and the Institute of Management Accounting and Auditing at WU Vienna publish the ninth edition of the ValueTrust DACH Capital Market Study. In our DACH Capital Market Study, we derive valuation parameters and cost of equity in a comprehensive manner for Germany, Austria and Switzerland to provide a sound basis for investment decisions. We present current valuation levels based on stock market multiples and estimate the cost of equity using four different methods for twelve different sectors. >more

EY
GERMAN PRIVATE EQUITY DEAL SURVEY 2021 HY1
The German private equity market has broken away from its Corona-induced restraint with a record number of deals: Financial investors made 156 deals in this country in the first six months - this marks an all-time high in a comparison of all half-years surveyed to date. The takeover of shoe manufacturer Birkenstock by investment company L Catterton and Financière Agache was the largest acquisition by a private equity fund in the first half of the year, worth 3.8 billion euros. The second megadeal worth more than one billion euros was completed by Apax Partners SAS with the acquisition of eyewear manufacturer Rodenstock for 1.5 billion euros. Overall, the average deal size has thus decreased - in the first six months, mainly smaller and medium-sized transactions dominated. >more

Bain & Company
PRIVATE EQUITY’S WILD FIRST-HALF RIDE
Let’s be honest: At this time last year, when Covid-19 was still casting a long shadow over the global economy, would anybody in the private equity industry have predicted that 2021 had the potential to blow the cover off the record books? We noted then that the deal market was showing surprising strength as massive government stimulus kept economies and markets humming around the globe. But the pace of recovery has been extraordinary, and, by almost any measure, 2021 is setting up to be by far the best year in the industry’s history. >more

KfW Research
SUSTAINABLE FINANCE IN KOMMUNEN: KANN DER GRÜNE KOMMUNALKREDIT DAS EIS BRECHEN?
The investment requirements for the climate-neutral transformation of public infrastructure in municipalities are high and can hardly be financed from current budgets. Sustainable Finance makes money available on the international capital market, but it has hardly been used at the municipal level so far because the usual capital market instruments are not suitable for many municipalities. Alternatives are therefore needed that are based on established instruments such as the municipal loan. However, in order to help the green municipal loan achieve a breakthrough, a number of course settings and pioneers in municipal financing are still needed. >more

WHAT DO YOU THINK ABOUT CLIMATE FINANCE?
Johannes Stroebel, and Jeffrey Wurgler
2021
We survey 861 finance academics, professionals, and public sector regulators and policy economists about climate finance topics. They identify regulatory risk as the top climate risk to businesses and investors over the next five years, but they view physical risks as the top risk over the next 30 years. By an overwhelming margin, respondents believe that asset prices underestimate climate risks. We also tabulate opinions about the correlation between growth and climate change; social discount rates appropriate for projects that mitigate the effects of climate change; most influential forces for reducing climate risks; and, most important research topics. >more

FUND MANAGER SKILL IN AN ERA OF GLOBALIZATION: OFFSHORE CONCENTRATION AND FUND PERFORMANCE
John (Jianqiu) Bai, Yuehua Tang, Chi Wan, and H. Zafer Yuksel
2021
We study how mutual fund managers gain an edge in selecting stocks in an era of globalization. We use textual analysis to construct a measure that captures a mutual fund’s offshore exposure concentration through holding US multinational firms. We find that funds with a higher offshore concentration index (OCI) perform significantly better, with the difference in four-factor alpha between the top and bottom deciles amounting to 2.95% per annum. Fund managers’ overweighting of firms with operations in certain countries can be partly attributed to their foreign ethnicity. High OCI fund managers have an information advantage regarding firms’ fundamentals, such as earnings. >more