18 December 2007: 2007 survey of holders of french government debt: investors' view of primary dealers

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The Survey

For the fifth year in a row, IEM-Finance conducted an online survey of investors who are customers of Primary Dealers in French Treasury Securities. The survey was commissioned by Agence France Trèsor (AFT) and focused on the quality of the Primary Dealers' customer relationships and customer service. In 2007, 341 respondents filled out the questionnaire, as compared to 344 in 2006.


Main survey findings

- The ranking of Primary Dealers cited by the most respondents as their leading intermediaries on the French Treasury securities market is as follows: BNP Paribas, followed by Société Générale, Calyon, Barclays Bank, and with ABN Amro and HSBC tied for fifth place. Three banks join this list in 2007: Calyon, ABN Amro and HSBC.

- The quality of Primary Dealers is still the most important selection criterion. The importance of this criterion declined for foreign-based investors, but the proportion of investors based in France who consider it “very important” increased by 10 points over 2006.

- Another noteworthy development in 2007 was a large increase in the importance that investors in France attach to Primary Dealers' being located in Paris. Some 46% deemed a Paris location to be “very important” or “fairly important”, as opposed to 36% in 2006.

- In terms of the quality of service provided by Primary Dealers, pricing was by far the most frequently cited aspect. The proportion of respondents who deem pricing to be “very important” was the highest in the history of the survey. The quality of information, advice and sales coverage was deemed to be “very important” by 53.3% of the respondents, maintaining its position as the second most frequently cited service quality criterion.

- The average rating attributed to Primary Dealers for research quality (7.4 out of 10) was down slightly from the previous year's survey and their average rating for pricing (7.3 out of 10) returned to it 2003 level. The average rating for the quality of information, advice and sales coverage was stable at 7.3 out of 10.

- Respondents were asked about their expectations with regard to a sovereign issuer, such as France. The most frequently cited qualities included liquidity (cited by 87.6% of respondents, versus 86.2% in 2006) and transparency (67.7% of respondents in 2007, versus 69.2% in 2006).

- As in previous years, the vast majority of respondents are very satisfied or fairly satisfied with how the French debt market works. The percentage of respondents reporting that they are “very satisfied” or “fairly satisfied” rose from 95% in 2006 to 96% in 2007, the highest level since 2004. Not one respondent reported being “not satisfied at all”.

- The use of electronic trading platforms is growing rapidly, particularly in France and the United Kingdom, but Italy is still the leading user of such platforms. The proportion of respondents using electronic platforms for more than three quarters of their trades in France rose from 24.1% in 2006 to 36.3% in 2007. The increase in the United Kingdom was from 8.7% in 2006 to 23.1% in 2007.

Press Contact:
Pierre Salaun
33 1 4004 1550
33 6 7224 0388