In a recent fireside chat, Matteo Zenari, the Global Head of Financial Sponsor Group of Intesa Sanpaolo, discussed the evolution of capital markets and the current structures for capital. The conversation, hosted by Giovanni Amodeo, covered a range of topics including the role of banks, the impact of interest rates, and the future of the market.

Zenari explained his role within the bank, stating that he leads the practice of financial sponsors globally and is very active with private equity across Europe and the US. He also discussed the positive start to 2024, attributing it to a couple of years of low activities in terms of new issuance and the expectation of rates being capped.

The conversation also touched on the potential impact of the Federal Reserve potentially cutting rates. Zenari believes that the market has already factored in the expectation of rate cuts into their investment attitudes.

Zenari also discussed the potential for increased exits in 2024 due to the current market conditions and the fact that private equity portfolios are quite loaded compared to previous years. He also touched on the competition between banks and private lenders, suggesting that there could be a stronger complementarity between the two.

In terms of the Italian market, Zenari predicts that it will be busier in 2024 compared to 2023, particularly in terms of refinancing and amendment and extension of current facilities. He also expects a significant growth in ESG in 2024 due to its importance in the decision-making process of fund managers.

Overall, Zenari’s insights provide a comprehensive overview of the current state of the capital markets and the potential trends for 2024.

Timestamps:

00:08: Introduction to the Fireside Chat
00:37: Introduction of Matteo Zenari and His Role
01:48: Activity in the Capital Markets
03:34: Discussion on Interest Rates and Fund Reaction
06:04: Impact of Vintage and Holding Period Extension
06:31: Competitive Pressure from Private Lenders
11:33: Refinancing and Capital Structure Adjustment
13:49: CFO’s Focus on Capital Structure
17:23: Impact of Exits on Fundraising and DCM Activity
19:29: Discussion on DCM and High Yield in 2024
23:16: Forecast for the Loan Market