July 13, 2011
It is one of Wall Street's few certainties. Ask a banker selling bonds or shares how their deals are doing and the answer is invariably: "Lots of interest from investors."
Now a European self-regulatory body is looking at whether that perennial optimism might have at times been misleading for investors in the European debt markets, according to people familiar with the matter.
The International Capital Market Association, or ICMA, is examining whether banks have been improperly exaggerating the amounts of investor demand they are seeing in certain bond sales, including for debt issued by European governments, these people say.
The action by ICMA has been sparked by complaints from some banks and investors that some lenders talked up investor interest in some bond deals in an attempt to whet investors' appetites for potentially risky bonds, such as those issued to support ailing euro-zone countries, these people say.
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