AFME is pleased to circulate its Q1 2019 Government Bond Data Report. This report provides a comprehensive data source with updated statistics of the Government bond primary and secondary markets in Europe (EU28). Report highlights include: Average daily trading volumes of European government bonds increased by 15% YoY during 1Q19, driven by a significant increase in France (52% YoY), Ireland (39% YoY) and Hungary (24% YoY) trading. There was a reduction in trading Italy (-27% YoY), Germany (-15% YoY) and Sweden (-5% YoY). European Government bond and bills gross issuance increased by 44% compared to 4Q18 and was 2% greater than the volume issued in 1Q18. During 1Q19 there were 4 long-term credit rating upgrades for EU countries and no downgrades. Divergence in secondary market trading of government debt securities in EU countries: turnover in the UK has increased 170% since 2006, whilst Germany and Italy have experienced modest declines in sovereign trading activity within the same period. Record bid cover ratio in Sweden as issuance volume shrinks. In 1Q19 a record breaking auction of 500mn SEK had a bid cover ratio of 6.03, this represents the most oversubscribed sovereign auction in Sweden for 3 years. The decline in supply of Swedish sovereign securities may be a contributory factor as debt issuance remains at record lows. Debt issued in longer tenors in selected EU CEE countries. During Q1 2019, weighted average years to maturity increased in Latvia (18.5% QoQ), Romania (12.6% QoQ), Slovenia (11.2% QoQ) and Czech Republic (8.8% QoQ).

AFME is pleased to circulate its Q1 2019 Securitisation Data Report. Main findings: In Q1 2019, EUR 32.4 billion of securitised product was issued in Europe, a decline of 63.4% from Q4 2018 and a decline of 44.7% from Q1 2018. Of the EUR 32.4 billion issued, EUR 16.5 billion was placed, representing 50.9% of issuance, compared to the 39.9% of issuance in Q4 2018 and the 55.1% of issuance in Q1 2018. Outstanding volumes rose slightly to EUR 1.2 trillion outstanding at the end of Q1 2019, a decline of 3.8% QoQ and an increase of 0.2% YoY. Credit Quality: In Europe, upgrades outpaced downgrades in Q1 2019, with upgrades concentrated in RMBS, both conforming and non-conforming. European asset backed commercial paper (ABCP) issuance was EUR 158.5 billion in Q1 2019, a sharp increase of 62.4% QoQ and a 132.3% increase YoY. Multiseller conduits continue to dominate as the largest category of issuer in the ABCP market, particularly from France and Ireland Regulatory update: The finalisation of the Level 2 legislation under the STS Securitisation Framework is still ongoing. Despite the slow start to the year, March saw the first STS transactions come to the market, from Volkswagen in Euros and then from Nationwide Building Society in sterling.

The Report contains European leveraged finance market trends for the first quarter of 2019, which includes issuance and credit performance figures for the high yield and leveraged loan markets. Key highlights: European leveraged finance issuance (leveraged loans and high yield bonds)increased to €41.9 billion in 1Q’19, a 19.0% increase from €35.2 billion in 4Q’18 but a 53.8% decrease from €90.6 billion in 1Q’18. Primary high yield issuancetotaled €17.0 billion on 38 deals in 1Q’19, a 145.1% increase from €6.9 billion on 22 deals in 4Q’18 but a 31.9% decrease from €24.9 billion on 71 deals in 1Q’18.The proportion of USD-denominated issuance increased to 52.4% of all issuance in 1Q’19 (8.8% in 4Q’18 and 43.1% in 1Q’18).The leading use of proceeds for high yield bonds issuance in 1Q’19 were general corporate purposes with €6.3 billion— up 126.8% from €2.8 billion in 4Q’18 but down 22.7% from €8.2 billion in 1Q’18.High yield issuance for refinancing and/or repayment of debt in developed market Europe increased to €2.4 billion in 1Q’19, representing 22.7% of all issuance, a twofold increase from €1.2 billion (17.0% of total) in 4Q’18 but a decrease of 55.1% from €5.2 billion (27.0% of total) in 1Q’18. Leveraged loan issuance, including first lien, second lien, and mezzanine financing, decreased to €24.9 billion in the first quarter of 2019, a 11.9% decrease from €28.2 billion in 4Q’18 and a 62.1% decrease from €65.7 billion in 1Q’18.Over one third (37.0%) of deals financed in the first quarter of 2019 were issued for refinancing and/or repayment of debt, down from 66.7% in 4Q’18 and down from 42.0% in 1Q’18.Pricing spreads for institutional loans widened by 25 basis points (bps) q-o-q and by 58 bps y-o-y while spreads for pro rata loans widened by 12 bps q-o-q and by 36 bps y-o-y. Credit quality:As of March 2019, S&P reported the trailing 12-month speculative-grade default rate at 2.0%, an increase from 1.9% end-December 2018 but a decrease from 2.1% end-March 2018. Moody’s reported the trailing 12-month speculative-grade default rate in March 2019 to be 0.9% (1.3% end-December 2018 and 3.1% end-march 2018).Four bond-related defaults were reported in the first quarter of 2019, three in developed market Europe and one in emerging market Europe. The most common reason for default in 1Q’19 was distressed exchange.According to S&P, in 1Q’19 downgrades exceeded upgrades in developed market Europe (26 downgrades to 13 upgrades), a much worse ratio than 39 downgrades to 27 upgrades in 4Q’18 and the 20 downgrades to 22 upgrades in 1Q’18.

Key highlights: In Q1 2019, EUR 32.4 bn of securitised product was issued in Europe, a decrease of 63.3% from Q4 2018 (EUR 88.4 bn) and a decrease of 44.6% from Q1 2018 (EUR 58.5 bn) The delay in approval by the EU public authorities of key elements of the new securitisation framework was a relevant factor behind the significant issuance decline during the quarter. However, in March, the European securitisation market saw the first transaction aimed to be compliant with the new STS regime, with further STS-compliant transactions currently in the pipeline. In April, the first public SONIA benchmarked RMBS transaction was marketed and notified to ESMA. This transaction is also the first UK STS compliant securitisation. Of the issued amount during Q1 2019, EUR 16.5 bn was placed, representing 50.9% of the total, compared to EUR 35.2 bn placed in Q4 2018 (representing 39.8% of EUR 88.4 bn) and EUR 32.2 bn placed in Q1 2018 (representing 55.0% of EUR 58.5 bn). In Q1 2019, PanEuropean CLOs led placed totals followed by UK Residential Mortgage-Backed Securities (RMBS) and UK Auto ABS.

AFME is pleased to circulate its Equity Primary Markets and Trading Report for the first quarter of2019 (1Q 2019). The report provides an update on the performance of the equity market in Europe in areas such as primary issuance, Mergers and Acquisitions (M&A), trading, and equity valuations. Key highlights: Equity underwriting on European exchanges accumulated a total of €25.3 bn in proceeds in 1Q19, a 33% decrease from the value originated in 1Q18 (€38.0 bn). IPO issuance in 1Q19 decreased 94% against the amount issued in 1Q18. Political uncertainty regarding the future relationship between the UK and the EU may have adversely impacted the European equity primary market as companies delayed capital raising on UK and EU27 exchanges to gather more information on potential implications of Brexit on capital markets. Only 5 IPOs were issued on UK exchanges during 1Q19— the lowest quarterly number since 2009. Completed Mergers and Acquisitions (M&A) of European companies totalled €208.9 bn in 1Q19, an increase of 6% from the amount completed in 1Q18 (€197.8 bn). The amount of announced M&A deals totalled €166.4 bn in 1Q19, a 51% decrease from 1Q18. APAC firms represented 77% of the inbound deal value, a sharp increase compared with 28% of the 2018FY inbound value. One “megadeal” (deal value above €10bn) was completed during 1Q19: Takeda Pharmaceutical-Shire plc. This deal represented 77% of the total deal value in the healthcare industry and 31% of the amount of completed M&A transactions in 1Q19. Equity trading activity on European main markets and MTFs generated a total of €2.6 tn in turnover value in 1Q19, a decrease of 18% from 1Q18 (€3.2 tn) Update on MiFID II dark trading caps: In March 2018, ESMA published the double volume cap (DVC) data files specifying the securities that surpassed the MiFID II limits of total dark trading on EU venues. The number of banned instruments from dark trading has decreased during the last 12 months to 342 instruments, from 755 in March 2018 and from 1,262 in August 2018. Due to concerns about disruptions of the ESMA IT systems after Brexit (expected initially for late March 2019), ESMA will not perform the DVC calculations in April and May 2019. The publication will be resumed in June 2019. 1Q 2019 YoY variation of European Equity activity

This report collates timely information on EU GSIBs’ prudential capital, leverage and liquidity ratios with updated information as at 31 December 2018. It also illustrates the recent performance of the debt and contingent convertibles (CoCo) markets and the funding structure for banks in Europe. Among the main findings of this report: The weighted average CET1 and leverage ratios for EU GSIBs declinedin 2018 against the ratios reported at the end of 2017. This was the first annual decline since 2013 when our dataset began.The annual decline in solvency ratios was due to several factors, including the implementation of the new accounting standard (IFRS9), an increase in RWAs and other bank-specific factors. EU GSIBs end-point CET1 ratio stood at 13.1% in 4Q18, below 13.4% in 4Q17. Earnings retention contributed 84bps to the CET1 ratio variation. This increase was offset 24bps by an increase in RWAs. IFRS9 implementation had a weighted-average negative impact of 24bps. Other factors, including FX variation, contributed to fully offset the contribution of profit retention (-64bps) End-point Tier 1 ratios decreased to 14.9% in 4Q18, from 15.1% in 4Q17. End-point Leverage ratios (LR) declined to 4.8% in 4Q18 from 4.9% in 4Q17. Liquidity Coverage Ratio (LCR) improved to 146.7% on a weighted average basis in 4Q18, from 141.8% in 4Q17. Capital raising from markets decelerated from a year ago:The amount of new capital raised during 2018 by EU banks totalled €22.0 bn— the lowest amount raised since 2009. The amount raised in 2018 brings the total tally of capital raised from markets since 2009 to €494 bn. Box: Capital markets trading: a recap of 2018:Securities trading revenues for the largest US and European investment banks marginally increased in 2018, reversing a post-crisis downward trend.However, there’s a sharp contrast between US and European trading revenue trends. US banks have continued to increase FICC (Fixed Income Currencies and Commodities) trading market share from 54% in 2012 to 66% in 2018 following a steep downward trend in European banks’ FICC revenues. US banks have consolidated their equity trading market share.

AFME is pleased to circulate its Q4 2018 Government Bond Data Report. This report provides a comprehensive data source with updated statistics of the Government bond primary and secondary markets in Europe (EU28). Report highlights include: The lowest annual average trading volume since 2013 was observed in 2018, according to MarketAxess. The average bid-cover ratio (demand/amount allocated) was 2.14 in 4Q18, showing no YoY change from 4Q17 however a decrease from 2.19 in 3Q18. The largest rise in bid-cover ratio was observed in Denmark, which increased 52% YoY and 41% QoQ to 2.66 in 4Q18. During 4Q18 there were 3 long-term credit rating upgrades for EU countries (following 8 in 1Q18, 3 in 2Q18 and 6 in 3Q18) and 1 downgrade, bringing the 2018 total to 20 upgrades and 1 downgrade. This shows substantial credit quality advancement of CEE and southern European countries, as all rating actions concern member states in these regions. Following 20 Primary Dealers leaving the market in 2018, the EU now has the lowest average number of Primary Dealers since the financial crisis. France now has 15 primary dealers, the lowest since records began, in 2006. In the Eurozone there are clear signs of fiscal consolidation over the last 10 years, with issuance volumes in 2018, at €1.8 tn, being 31% lower than the record issuance in 2008 of €2.6 tn. Annual issuance of EU Sovereign Green Bonds increased 40% in 2018. After issuance from Ireland in 4Q18, 5 EU countries now have green bonds outstanding.

AFME is pleased to circulate its Q4 2018 Securitisation Data Report. Main findings: In Q4 2018, EUR 88.4 billion of securitised product was issued in Europe, an increase of 62.1% from Q3 2018 and an increase of 19.3% from Q4 2017. Of the EUR 88.4 billion issued, EUR 35.2 billion was placed, representing 39.9% of issuance, compared to the 55.1% of issuance in Q3 2018 and the 42.5% of issuance in Q4 2017. It should be noted that in 2019 to date, public issuance has fallen sharply with only EUR 3.0bn European ABS issued to date according to market analysts, representing the slowest start to the year since 2009. The delay in approval by the EU public authorities of key elements of the new securitisation framework is clearly a factor, as well as the new and unhelpful LCR rules. At the time of writing, only one transaction which aims to be compliant with the new STS regime has been announced. Outstanding volumes rose slightly to EUR 1.24 trillion outstanding at the end of Q4 2018, an increase of 3.8% QoQ and an increase of 1.9% YoY. Credit Quality: In Europe, upgrades outpaced downgrades in Q4 2018, with upgrades concentrated in RMBS, both conforming and non-conforming. European asset backed commercial paper (ABCP) issuance was EUR 97.6 billion in Q4 2018, a decline of 24.4% QoQ (from EUR 129.1 billion in Q3 2018) but a 30.1% increase YoY (from EUR 75.0 billion in Q4 2017). Multiseller conduits continue to dominate as the largest category of issuer in the ABCP market, particularly from France and Ireland in the fourth quarter Regulatory update: The final drafts of the following technical standards have been submitted for the European Commission’s (EC) endorsement: (i) EBA draft RTS on Risk Retention; (ii) EBA draft RTS on Homogeneity; (iii) ESMA draft RTS and ITS on STS Notification; and (iv) ESMA draft RTS and ITS on Securitization Data Repositories. These final drafts are expected to be adopted by the EC and will then be subject to a scrutiny period by the European Parliament and the Council. It is hoped that this process will be completed very soon, and in any event before the European Parliament rises in April for the elections in May The impact of the Liquidity Coverage Ratio (LCR) Delegated Act is now observable as a material constraint on bank investor participation. This is concerning, and AFME intends to revisit this topic with the Commission later in 2019.

The Report contains European leveraged finance market trends for the fourth quarter of 2018, which includes issuance and credit performance figures for the high yield and leveraged loan markets. Key highlights: European leveraged finance issuance (leveraged loans and high yield bonds) decreased to €28.9 billion in 4Q’18, a 43.7% decrease from €51.3 billion in 3Q’18 and a 72.4% decrease from a record €104.6 billion in 4Q’17.For the full year 2018, European leveraged finance issuance reached €215.5 billion, a decrease of 34.0% from €329 billion in 2017. Primary high yield issuance totaled €6.9 billion on 22 deals in 4Q’18, a 60.9% decrease from 3Q’18 (€17.7 billion on 46 deals) and a 82.1% decrease from 4Q’17 (€38.6 billion on 90 deals). All of the high yield issuance in 4Q’18 was in developed market Europe with no issuance in emerging Europe. For the full year 2018, high yield issuance totaled €74.9 billion, a decrease of 41% from €127.9 billion in 2017.The proportion of USD-denominated issuance decreased to 8.8% in 4Q’18, down from 20.6% in 3Q’18 and 16.8% in 4Q’17. For the full year 2018, USD-denominated deals accounted for 27.2% of total issuance, down from 30.3% of the total in 2017.The leading use of proceeds in 4Q’18 were general corporate purposes with €2.8 billion, followed by acquisitions with €1.5 billion and leveraged buyouts with €1.3 billion. For the full year, general corporate purposes was also the main use of proceeds with €34.3 billion, followed by refinancing and/or repayment of debt (€ 17.6 billion) and acquisitions (€9.5 billion). Leveraged loan issuance, including first lien, second lien, and mezzanine financing, decreased to €22.0 billion in 4Q’18, a 34.7% decrease from €33.6 billion in 3Q’18 and a 66.7% decrease from €65.9 billion in 4Q’17. For the full year 2018, €140.6 billion in leveraged loans were issued, down 30.1% from €201.1 billion in 2017.Refinancing and/or repayment of debt were the largest use of proceeds in 4Q’18 with €14.8 billion, followed by leveraged buyouts (€6.1 billion) and general corporate purposes (€0.5 billion). For the full year, leveraged buyouts was the main use of proceeds (€52.2 billion), followed by refinancing and/or repayment of debt (€50.4 billion) and acquisitions (€30.6 billion).In 4Q’18, pricing spreads for institutional loans widened by 4 basis points (bps) q-o-q but tightened by 21 bps y-o-y while spreads for pro rata loans widened by 21 bps q-o-q and by 11 bps y-o-y. Credit quality: As of November 2018 (December 2018 data not available at time of publication), S&P reported the trailing 12-month speculative-grade default rate at 1.9%, a decrease from 2.1% end-September 2018 and a decrease from 2.4% end-December 2017. Moody’s reported the trailing 12-month speculative-grade default rate in December 2018 to be 2.3%, up from 2.0% end-September 2018 but down from 3.4% end-December 2017.Five bond-related defaults were reported in 4Q’18, four in developed market Europe and one in emerging market Europe. For the full year 2018, 20 European high yield issuers defaulted, 15 in developed market Europe and the remaining five in emerging market Europe.According to S&P, in 4Q’18 downgrades exceeded upgrades in developed market Europe (39 downgrades to 27 upgrades), a much worse ratio than 17 downgrades to 19 upgrades in 3Q’18 and than 26 downgrades to 47 upgrades in 4Q’17. For the full year 2018, the number of upgrades decreased to 99 from 137 in 2017 while the number of downgrades increased to 102 from 91 in 2017.

AFME is pleased to circulate its Equity Primary Markets and Trading Report for the fourth quarter of 2018 (4Q 2018). The report provides an update on the performance of the equity market in Europe in areas such as primary issuance, Mergers and Acquisitions (M&A), trading, and valuations. Key highlights: Equity underwriting on European exchanges accumulated a total of €123.2 bn in proceeds in 2018, a 42% decrease from the value originated in 2017 (€211.6 bn). IPO issuance in 2018 decreased 15% against the amount issued in 2017. The 2018 market uncertainty generated a sharp increase in the number of European IPOs withdrawn or postponed. 51 IPO deals were withdrawn or delayed in 2018, an increase from 20 in 2017— also the highest number since 2008 Completed Mergers and Acquisitions (M&A) of European companies totalled €1,042 bn in 2018, an increase of 11% from the amount completed in 2017 (€937.6 bn). The amount of announced M&A deals totalled €1,078.7 bn in 2018, a 23% increase from 2017. APAC firms represented 28% of the inbound deal value, a sharp decline compared to 47% of the 2017 inbound deal value Valuation multiples stood roughly above 2006-18 averages. The median Enterprise Value to EBITDA ratio (EV/EBITDA) of targeted firms stood at 12.5x in 2018, compared to an annual average of 11.2x in 2006-18. Equity trading activity on European main markets and MTFs generated a total of €11.9 tn in turnover value in 2018, an increase of 4% from 2017 (€11.4 tn) Update on MiFID II dark trading caps: In March 2018, ESMA published the double volume cap (DVC) data files specifying the securities that surpassed the MiFID II limits of total dark trading on EU venues From a Universe of 26,750 equity-like securities traded in the EU, 625 are currently suspended from dark trading either on specific EU venues (93 securities) or on all EU venues (532) after surpassing the MiFID II dark trading thresholds (4% dark traded in a given trading venue and 8%on EU venues to triggersuspension at EU level). The number of instruments suspended from dark trading has decreased during the year from 755 in March 2018 and from 1,262 in August 2018 after c700 instruments completed its 6-month suspension period started in March Annual dark trading volumes declined 21% in 2018 against 2017, in part attributed to the new DVC regime. 2018FY annual variation of European Equity activity