London, April 1, 2005 – Companies in Europe, the Middle East and Africa (EMEA) borrowed a record $227 billion of loans in the first quarter, as Europe's corporate titans cut borrowing borrowing costs further, according to Loan Pricing Corporation, Reuters syndicated loans unit.

Bankers had their busiest-ever start to the year as companies rushed to refinance existing debt to lock in favourable rates, pushing lending 77% higher than the first quarter of 2004.

The cost of syndicated loans has been falling since mid 2003 as bank competition for mandates and income has intensified, but the rate of decline accelerated during late 2004, allowing companies to make further reductions to interest margins.

"It was an active, upbeat and aggressive quarter," a head of loan syndicate said.

French drug giant Sanofi set the tone of the quarter with a Eurofive billion refinancing of the short-term element of the Euro 16 billion loan of April 2004 that financed its acquisition of rival Aventis. The deal cut Sanofi's interest margin 75% from 40 bps to 10 bps.

The pharmaceutical giant found market conditions so favourable that it returned to refinance the remaining Euro8 billion in March, extending its maturity to seven years and cutting pricing by a similar percentage to 12.5-14 bps.

French utility Gaz de France was inspired to cut its costs with a three billion euro refinancing and EdF followed suit with a Euro6 billion loan that cut its interest margin to 12.5-15 bps. and extended its maturity to seven years.

All of the large blue-chip multi-billion refinancings were well received by the highly liquid loan market and achieved large oversubscriptions despite aggressive pricing.

M&A financing is on the rise. First quarter M&A lending of $41.6 billion is up 42% year on year, and is the highest figure seen since 2001.

The $6.5 billion loan backing BHP Biliton's agreed A$9.2 billion bid for Australia's WMC Resources was the largest M&A loan of the quarter and caused rival Xstrata's $6.6 billion loan to lapse as its bid was eclipsed.

Strong activity from France - also a theme of 2004 - meant France's BNP Paribas (BNP.PA)emerged as the lead arranger of syndicated EMEA bank loans with $20.8 billion of volume.

Citigroup (C.N) came in second with $19 billion, followed by Royal Bank of Scotland, which notched up $16.7 billion of loans.

LEVERAGED MARKET STRONG
The leveraged loan market, which finances more indebted non-investment grade companies and private equity activity produced first quarter lending of $36 billion.

Private equity activity of $27 billion has more than doubled since the first quarter of 2004 due to the large number of recapitalisations, as private equity firms used bank debt to pay themselves dividends.

Large recapitalisations in excess of Euro 1 billion such as U.K. gaming firm Gala Group, rival Coral Eurobet, European satellite operator Eutelsat and French electrical equipment distributor Rexel pushed recapitalisation volume to $12.7 billion, while new LBO lending reached $14.6 billion.

Following is Loan Pricing Corporation's EMEA league table for the first quarter of 2005.

Rank	Bank Holding Company	Volume (U.S.$)	Deals	Share
1	BNP Paribas	$20.78	66	9.17%
2	Citigroup	$19.05	54	8.41%
3	Royal Bank of Scotland	$16.69	66	7.37%
4	Societe Generale	$15.68	42	6.92%
5	HSBC	$15.39	56	6.79%
6	Barclays	$14.19	57	6.26%
7	Deutsche	$12.81	24	5.66%
8	Calyon	$10.71	44	4.73%
9	J.P. Morgan	$7.89	24	3.48%
10	ABN AMRO	$7.77	25	3.43%

About Loan Pricing Corporation
Since 1985 Loan Pricing Corporation (LPC) (www.loanpricing.com), a Reuters Company, has provided market players around the world with the most complete and accurate news, data and analytics on bank loans. LPC's coverage spans the U.S., Europe, Middle East, Africa, Latin America, and Asia-Pacific via subsidiary Basis Point Publishing Limited. LPC's content is delivered via publications, on-line services and databases.

LPC is the premier global provider of loan market information and analysis as a result of its in-depth focus on the loan industry and development of state-of-the-art products and services for bankers, borrowers and loan investors.

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