Throughout the pandemic, companies around the world have faced uncertainties: How long would it last? How much cash would they need? How should they shore up their finances to prepare for the unknown?
Many of those companies, faced with increased volatility in the global financial markets and potential disruptions in their business operations, turned to their banking partners for help.
U.S. Bank was there for them, helping clients raise billions in the fixed income and loan capital markets.
“We are known for being relationship oriented,” said Stephen Philipson, head of Fixed Income & Capital Markets (FICM) at U.S. Bank. The FICM team helps large corporate, middle-market, and commercial real-estate clients with loan and bond offerings (corporate and municipal), as well as interest rate and foreign-exchange solutions.
“How a bank responds to its clients during moments of uncertainty in the markets and economy define those relationships for years to come,” Philipson said. “We have a strong balance sheet – we were the only large bank that did not have a quarterly loss after the ’08 crisis – and the confidence to provide liquidity during these times. We have stood by our clients, and they have entrusted us with an increased share of their capital markets business.”
That trust shows in the numbers: in 2020, U.S. Bank was ranked No. 5 in the number of syndicated loan deals (loans that are offered by a group of lenders) for which it served as bookrunner (or lead coordinator). Last spring, during the height of COVID-19, U.S. Bank was ranked No. 4 for the number of deals for which it served as bookrunner – an increase of 56% (vs. the next closest competitor, whose bookrunner activity was up just 16%).
In addition, U.S. Bank was ranked No. 1 in both the number and volume of deals that it led for sports teams and leagues in 2020, as teams and leagues borrowed money to ensure they had enough cash on hand to weather the pandemic.
U.S. Bank also showed unwavering commitment to its utility clients, lending $3 billion of the $16 billion in capital raised in 2020. Notably, U.S. Bank led more transactions in that industry than any other financial institution and closed 13 deals over a 21-day period.
“The utility industry is a strategic focus for U.S. Bank, and we pride ourselves on our long-term partnership with our clients,” said Paul Morrison, senior vice president and division manager of the Utilities Division in Corporate Banking. “We were gratified to receive significant feedback from utility executives who recognized the value of our support and leadership during a challenging time.”
Brian Zimmer, senior vice president of Loan Capital Markets, agreed. “Our team was proactive and committed to helping our clients during their time of need. We had an ability and a willingness, and we worked as a team to fund their loans quickly.”
In a nod to the bank’s reputation for integrity and trust, in late 2020 the Federal Reserve of New York added U.S. Bank as an approved seller for the Fed’s Secondary Market Corporate Credit Facility (SMCCF), which allowed the bank to sell bonds on behalf of its clients to the Federal Reserve.
“The Fed programs created a sense of stability for our investing and borrowing clients,” Philipson said. “They ensure proper functioning in the financial markets.”
Now, as companies shift back to business as usual as the economy begins to recover, they are thinking about how they can better utilize the cash they have raised, said Jimmy Whang, co-head of the bank’s Credit and Municipal Fixed Income team.
“For some clients who were less negatively impacted by the pandemic, we’re talking with them about liability management, reducing their debt, and creating a more efficient balance sheet,” he said.