EuroCatalyst

EUROCATALYST 2004: Growth, integration and differentiation in European housing finance and fixed-income investment

Program outline:
DAY 2 Tuesday, 12 October 2004

(Click here for the outline for Day 1)
(Click here for the outline for Day 3)

DAY CHAIR / Will Ross
REGISTRATION 0730-0830	REGISTRATION DESK OPEN

OPENING 0830-0845 [main ballroom]	WELCOME TO BERLIN 2004: OPENING MULTIMEDIA

SESSION 1 0845-0945 [main ballroom]	BOARD ROOM – REPOSITIONING THE VALUE OF MORTGAGES IN EUROPEAN MARKETS: TARGETING OPPORTUNITIES FOR GROWTH Integration, convergence, unity, a single market - all catch phrases called key to encouraging the growth and development of Europe. This presentation by seven key players in the annual EuroCatalyst think tank sets the stage for EuroCatalyst 2004: Live from Berlin, by examining the opportunities for corporate growth in a sector (mortgages) that is continually being defined by superlatives but is so often treated as the ugly duckling of financial services.
	TOPICS	Identifying the markets for growth in European housing finance: Toni Moss Growth through European integration (expansion of Accession countries): Will Ross Growth through cross-selling expansion into other consumer credit sectors: Matthew Sebag-Montefiore Growth within European markets and funding and investment in RMBS and covered bonds: Alexander Batchvarov Growth by industry sectors that define the mortgage value chain: Dr. Michael Lea Growth through innovation: Alex Pollock

SESSION 2 0945-1100 [main ballroom]	BOARD ROOM – EUROPE 10/20/50: THE BLUEPRINT FOR EUROPEAN MORTGAGE FUNDING This session defines the European capital market landscape by providing a matrix for optimizing portfolio funding considerations between cash securitisation, structured covered bonds, Pfandbrief and senior debt. Spanning wholesale and retail markets, on and off-balance sheet funding and incorporating risk transfer and Basle II, the session creates a template to examine how to structure, fund and leverage mortgage assets based on any national market. The session addresses return on equity, return on assets and return on economic capital vs. straight equity, providing the context for the entire event as changes in the funding spectrum cause resulting changes throughout the entire mortgage value chain.
	CO-HOSTS	Hoesli Labhart, Director, European Securitisation, Citigroup Dominic Swan, Head of SIVs, HSBC
	PANEL	Liam Coleman, Head of Treasury, Nationwide Kris Wulteputte, Managing Director, SNS Financial Markets Ganesh Rajendra, Head of European Securitsation Research, Deutsche Bank Torsten Althaus, Director, Standard & Poor's Gabriele Müller, Capital Markets Director / Germany, Genworth Financial

1100-1115: MORNING REFRESHMENT BREAK
SESSION 3 1115-1230 [main ballroom]	BOARD ROOM – BLUEPRINT FOR INTEGRATION: ASSESSING THE FSAP AND ITS PRIORITIES A discussion with select members of the FSAP stock-taking group on Banking, Asset Management and Securities and the DG Markt Forum Group on Mortgage Credit / Despite the potential and prominence of European mortgage markets and products within European financial services, the markets are notoriously laggard in preparing for cross-border developments, particularly as they relate to the ambitious goals of the Financial Services Action Plan (FSAP). While mortgage markets remain local, their funding is increasingly global, causing a growing gap throughout the value chain and resulting in few cross-border lenders. As the 2005 FSAP deadline approaches, we are entering a new phase of the legislative cycle of European institutions with an expanded EU, a new Parliament and a new Commission. To achieve the 2010 Lisbon agenda objectives, the measures adopted under the FSAP must bring the European Union closer to having a truly integrated European financial market. In this session we've asked those from select stock-taking groups reporting to the European Commission that relate to mortgage lending to provide a view of European mortgage markets from the perspective of the financial services industry. This session provides the greater context for bridging all mortgage market issues, outlines current initiatives undertaken by the Commission and the Council and defines where we stand to date and what remains to be done.
	SPEAKER	Patrick Pearson, Head of Banking and Financial Conglomerates, DG Markt, European Commission
	PANEL	Bill Eldridge, Public Policy Director -- EU, Barclays Bank PLC Pehr Wissén, Deputy General, Treasury, Svenska Handelsbanken Sacha Polverini, Head of European Regulatory Affairs, Genworth Financial Jill Craig, Head of European Policy, RICS
1230-1330: LUNCH
SESSION 4 1330-1415 [main ballroom]	BOARD ROOM – CAPITAL DARWINISM AND EUROPEAN MORTGAGE MARKETS: INTEGRATION THROUGH CONSOLIDATION When discussing integration most assume a definition that refers to the geographic expansion of new markets. This session discusses the inevitably of integration through consolidation, as the large banks continue the search for acquisition candidates to enter new markets and increase scale, capitalization, capabilities and distribution. Europe is a notoriously difficult environment in which to achieve all of the cost-cutting benefits of consolidation given the rigidity of labour markets, socio-political hurdles and negative public images of cross-border mergers. However, the "urge to merge" is the top agenda item in most European bank board rooms. A sub-theme of the session is cross-sector consolidation, as firms achieve domination in each industry sector. As consolidation begins to take hold in European markets, it will forever alter the landscape of competition moving forward. Banking sector consolidation Covered bonds Asset management Ratings implications of banking mergers
	PANEL	Sam Theodore, Managing Director, Global Banking Coordinator, Moody's Investors Service Jean-Louis Bravard, Managing Director, Global Financial Services Group, EDS Michael Zlotnik, Managing Director, Head of FI Europe, Financial Services Group, Standard & Poor's Klaus C. Engelen, Contributing Editor, International Economy, and International Correspondent, Handelsblatt

SESSION 5 1415-1530 [main ballroom]	REGIONAL MARKET SESSION: GERMANY / SURVIVAL OF THE FITTEST Germany is the world's third-largest economy (in terms of GDP) after the US and Japan and Europe's second largest mortgage market. Once heralded as a world-class model for national productivity and stability, the German economy continues to bear the unprecedented weight of economic integration between East and West. The three parallel banking systems (public, co-operative and private) that have previously defined the strength of and provided a balance for the German banking sector have now evolved into a Darwinian struggle for survival. Commercial reality dictates that where there is confusion, there is profit. Therefore, while the German political process manages the challenges of structural reforms, this session focuses on the diversity of strategies undertaken by major market players as they seek to streamline their balance sheets and find sustainable growth leveraging every possible opportunity throughout the global mortgage value chain. A key focus for the session are the ways in which German lenders are fully leveraging the entire funding spectrum and the implications of that expansion.
	HOST	Horst Bertram, Director, Capital Markets, Fitch Deutschland
	PANEL	Dr. Karsten von Köller, Chairman, Lone Star Europe, Former Chairman, EuroHypo Dr. Louis Hagen, General Manager, VDH Dr. Dieter Glüder, Head of Asset Securitisation, KfW Group Joerg Huber, Head of Debt Capital Markets, LBBW Michael Zlotnik, Managing Director, Head of FI Europe, Financial Services Group, Standard & Poor's Peter Schott, Managing Director, Aareal Bank Iain Barbour, Global Head of Structured Finance, Commerzbank

1530-1545: AFTERNOON REFRESHMENT BREAK
SESSION 6 1545-1645 [main ballroom]	REGIONAL MARKET SESSION: UNITED KINGDOM From High Street to Main Street: Commoditised vs. specialized lending in the UK market Since the mid-1990's UK lenders have flourished in an extended "bullish" operating environment. In addition to the normal attrition of competition, the combined factors of low interest rates, increased customer awareness and one of the most highly intermediated markets in the world has led several mainstream lenders into specialist or niche sectors of the market (Buy-to-Let, Self-certification and Non-conforming) in search of profit. While some argue that "specialist" mortgage lending requires an entirely different set of skills and corporate culture to balance a healthy risk-return profile, others . Others view expansion into new sectors as a natural progression of commoditised lending. "Grid distribution" in mortgage lending: Leveraging distribution channels for profit Despite increased regulation posed by "Mortgage Day" on October 31, intermediaries will retain their pivotal role in the UK mortgage value chain. Specialised packagers are increasingly transitioning from broker to banker by originating loans for a quick sale to larger lenders, while retailers such as Sainsburys, Tesco and other strong brand names are leveraging their brand to aggregate customer bases to intermediate in increasing variety of financial services products including mortgages. We introduce the concept of "Grid distribution" to get everyone thinking about how to leverage all existing channels of distribution and imagine the possibilities for new ones. Integrating funding tools "Structured covered bonds" contain unique structural diversities that integrate securitization techniques to enhance the program creditworthiness of each issuer and reproduce existing UK law in lieu of specific legislative frameworks common to traditional covered bonds. In the funding spectrum with true securitization at one end and secured debt at the other, structured covered bonds are on the securitization end of that spectrum. The HBOS Treasury Services PLC Covered Bond Programme launched in July of 2003 has been the catalyst of the European covered bond sector, issuing €8.25 billion in a series of 4 transactions to date. This past April Northern Rock followed by launching its €2 billion fixed-rate covered bonds series 1, and in July Bradford & Bingley has become the third UK lender to tap the markets with a €10 billion global covered bond program. Animal farm: The UK mortgage market starring Chicken Little, Bambi and Godzilla . Fans of international cartoons cannot forget the 20 second film clip of the initial meeting between Bambi and Godzilla. Bambi, the docile doe of Disney fame, meets a tragic fate as Godzilla's foot crushes her while walking through the forest. Chicken Little, of course, is famous for running around and frantically proclaiming "the sky is falling". This discussion addresses the drama and chaos that many fear could unfold in the UK market, and prospects for its future. If there is, in fact, impending chaos in the market, we'll take our best guesses regarding where the safe harbors will be and who might be best-positioned to profit from it.
	HOST	Adrian Coles, Director General, Building Societies Association
	PANEL	Stuart Jennings, FitchRatings Jeremy Wood, Divisional Director of Treasury, Nationwide Angela Clist, Partner, Allen & Overy Tim Skeet, Managing Director Origination, DCM, ABN Amro Ray Boulger, Senior Technical Manager, Charcol Matthew Wyles, Group Development Director, Portman Building Society Simon Hinshelwood, Chief Executive Officer, Global Home Loans

SESSION 7 1645-1800 [main ballroom]	BOARD ROOM – CHAMPAGNE CHALLENGE: THE DEBATE CONTINUES FOR THE THIRD YEAR . . . PAN-EUROPEAN FUNDING ALTERNATIVES / DO EU POLICYMAKERS CARE ABOUT HOUSING FINANCE? WE WOULD LIKE TO EXTEND SPECIAL THANKS TO PMI EUROPE LTD. FOR THEIR CONTINUED SUPPORT OF THIS ANNUAL CHAMPAGNE DEBATE Held back by inevitable comparisons to Fannie Mae and Freddie Mac, the built-in requirement of standardization along the entire mortgage value chain and the need for implicit state guarantees, proposals thus far for a single European funding agency have fallen by the wayside. Does it really make sense to integrate funding for Europe's national markets? Does size really matter for liquidity? Would a single funding agency truly enhance integration of the mortgage markets? Does globalization require Europe to look like the U.S. 20 years down the road? All of these questions provide fuel for discussion as we bring together the proponents, opponents, and interested observers for a crossfire debate on pan-European funding alternatives.
	CO-HOSTS	Adrian Coles, director general, Building Societies Association Dr. Michael Lea, principal, Cardiff Consulting
	PRESENTERS	Rob Thomas, EMFA Alex Pollock, Senior Fellow, American Enterprise Institute
	PANEL	Tony Porter, Managing Director, PMI Europe Jean-Michel Beacco, Global Head of Credit, Calyon Dr. Luiz Beleza, Millennium BCP Achim Duebel, economist

(Wednesday, 13 October 2004)		© 2004 EuroCatalyst BV