IFLR 1000
The Guide to the World's Leading Financial Law Firms

Though some have commented that Poland's banking system has been holding up better than counterparts in some neighbouring jurisdictions, raising debt is not easy. One partner says: "The credit market is a problem, really....

Though some have commented that Poland's banking system has been holding up better than counterparts in some neighbouring jurisdictions, raising debt is not easy. One partner says: "The credit market is a problem, really. I've just visited eight banks looking for loans for clients in the range of €30 million to 200 million. On spot deals like these, not one of them is willing to enter into arrangements without handling things as a club deal."

The slow-down in lending first hit in September 2008, and firms comment that a lot of their work between that time and Q3 2009 has involved the restructuring of existing loan facilities, acting either for banks or for borrowers in negotiations following breaches of covenant.

In Q2 2009 a partner at one of Warsaw's big firms said, "This is probably the most difficult period in the history of Poland's capital markets."The equity market has historically been the area of highest activity on Poland's capital markets, and of course equity has been worst hit by the global financial downturn....

In Q2 2009 a partner at one of Warsaw's big firms said, "This is probably the most difficult period in the history of Poland's capital markets."

The equity market has historically been the area of highest activity on Poland's capital markets, and of course equity has been worst hit by the global financial downturn. While some neighbouring jurisdictions saw faint signs of recovery during the first two quarters of 2009, Poland remained quiet, save for the occasional debt issuance – such as the city of Warsaw's landmark €1.3 billion MTN programme, which was handled by Allen & Overy.

There have also been some big moves between firms over the past year. Zbigniew Mrowiec has shifted from Dewey & LeBoeuf Grzesiak to Allen & Overy. Linklaters lost Marcin Chylinski, who, as well as taking some other lawyers from the firm, has moved back to Weil Gotshal & Manges.

As a clear result of the global financial downturn, M&A dropped off steeply in September 2008 according to many partners – largely because private-equity funds slowed their activity down dramatically due to fast-shifting prices and the risk-averse attitudes of lenders.However, in Q2 2009 one partner said: "The market index has risen 40-50% since December and now private equity funds are complaining the prices are too high already....

As a clear result of the global financial downturn, M&A dropped off steeply in September 2008 according to many partners – largely because private-equity funds slowed their activity down dramatically due to fast-shifting prices and the risk-averse attitudes of lenders.

However, in Q2 2009 one partner said: "The market index has risen 40-50% since December and now private equity funds are complaining the prices are too high already. It could be they feel they missed the boat."

It hasn't been all doom and gloom for the legal market. Firms have been seeing activity from strategic investors who are either cash rich, ready for their next move, or both. There has also been a good flow of work for firms' corporate teams as companies have reorganised themselves internally to move through the downturn and beyond.

It would be easy to assume that the slowdown in bank lending would cause project and infrastructure financing to come to a grinding halt, but that hasn't been the case in Poland.Bank lending has slowed down and financial institutions are less likely to jump into syndicates on highly-geared project financings, but the willingness of regional development banks and export credit agencies to act as mandated lead arrangers in, mostly, club deals has meant that project finance activity, including the use of PPP structures, has rolled on through 2009....

It would be easy to assume that the slowdown in bank lending would cause project and infrastructure financing to come to a grinding halt, but that hasn't been the case in Poland.

Bank lending has slowed down and financial institutions are less likely to jump into syndicates on highly-geared project financings, but the willingness of regional development banks and export credit agencies to act as mandated lead arrangers in, mostly, club deals has meant that project finance activity, including the use of PPP structures, has rolled on through 2009.

There have also been some encouraging infrastructure-driven municipal bond issuances, including those for the city of Warsaw and the Agency for Development of Mazovia.

The A1 and A2 motorway financings closed in 2009, as well as financings for coal-fired and renewable energy projects.