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

Much like the other areas of the capital markets, structured finance and securitisation work has been very patchy in the last year. With investor and consumer confidence at rock bottom after the country's recent troubles it is perhaps unsurprising that issuers have been less than ambitious in their undertakings.

In truth, work around products such as CDO and CLOs was low before the earthquake and connected events. With their reputation damaged by the financial crash the market had not recovered enough to have been further effected in the aftermath of the natural disasters.

A small beacon of light is the subtle rise of convertible bonds. A relatively new product in certain parts of Asia, it is beginning to garner interest and a few deals have been seen in the Japanese market. There has also been a slight resurgence of work in terms of securitisation.

'Allen & Overy's performance has been excellent," says a client of the magic circle firm's structured finance practice. "It is not the cheapest but you pay for quality." Another client remarks: "The lawyers are well-experienced in different types of structured deals and always advises us new and innovative solutions for a risk of the deal."

Allen & Overy remains a prominent name within the structured finance and securitisation field due to the impressive work done by partner Norifusa Hashimoto and his team, including leading derivatives counsel Aaron Comerford. Many clients are quick to mention the team's unparalleled advice on over-the-counter (OTC) derivatives work. The already impressive team was bolstered in October last year by the arrival of Counsel, Mark Heimendinger from Skadden's Tokyo office. The firm hopes to boost its real estate finance and securitisation capabilities with Heimendinger's arrival. Peers offer a resounding chorus of admiration and credit to this team that stays high up in the top tier. Clients are even more effusive in their praise.

"The firm has good expertise in OTC derivatives products. Its quality is very good," says one banking client, while another adds: "The lawyers provide the necessary advice in a timely fashion, which is quite impressive."

"On derivatives side, Aaron Comford and Seiji Matsuzoe is a very good team who can provide seamless services from an international perspective plus have Japanese local input," says a client. "Other firms tend to be strong in either of international aspect or domestic aspect but as I mentioned, Aaron and Seiji are the good team to provide very well-integrated legal advice".

Despite investor appetite continuing to languish and a slow deal flow due to market conditions, whatever work that was to be had in the securitisation or structured finance space, Allen & Overy was quick to pick it up. The team was involved in the first CMBS deal since the collapse of Lehman Brothers and the first secured TMK Bonds and restructurings of asset-backed securities (ABSs) and CMBS.

Clients single out Allen & Overy for its credit derivatives experience, being the go-to firm for this work given its first-hand experience with credit events and the resulting credit derivative auction settlement. For example, Comerford and Matsuzoe have been busy this year advising a group of ten international and domestic financial institutions on the establishment of the first credit derivatives clearing platform in Japan. In another deal, Hashimoto worked with Nomura Securities as an arranger of a ¥5.5 billion (71 million) loan and CMBS backed by a loan. Clients flocking to the magic circle firm read like a who's who on a list of prestigious financial institutions: Goldman Sachs, Shinsei Securities, UBS, Credit Suisse and Bank of America Merrill Lynch, among many others.

A US investment bank client says the firm's "analyses are always very thorough", and suggests that Comerford "should be made up as a partner. Aaron is indispensable with respect to complex finance deals in Japan involving derivatives. The results he produces will unfailingly exceed your expectations."

"Tatsu Katayama is a very good lawyer," proclaims one rival, one among many to shower Mr Katayama with praise. Katayama, along with a 13 other partners, helm Anderson Mori & Tomotsune's securitisation and structured finance team. The market was quiet this year, further strained by the earthquake and tsunami, but the team managed to deliver on several notable transactions.

"The lawyers' advice is very precise, to the point, persuasive and easy to understand," says one client. "They are quick to respond."

Minoru Kobayashi and Naokuni Fukuda served as counsel to Sumitomo Life Insurance Company and its special purpose company (SPC) on its funds securitisation worth $859 million. Reflecting its lawyers' ability to develop novel structures, the team developed an innovative and complicated mechanism that maximised flexibility for mutual life insurance companies by using a "foundation funds securitisation structure". This transaction set precedent as the first securitisation case to include a call option exercisable by the SPC in the event that the company transformed into a joint stock corporation.

Known for its specialisation in complex structured finance and securitisation work, Atsumi & Sakai may be the most well-known domestic firm in this space. "It is one of the most famous legal firms for structured finance in Japan," said a local banker. "We are satisfied with its lawyers' knowledge and skills."

Hiroo Atsumi has long-been regarded a luminary in the market and his firm has done well over the past year since evolving from Atsumi & Partners. Despite a loss of partner Horaki Takahashi and his team of seven to a rival joint venture firm, Davis & Takahashi, the firm's core focus on growth remained unfazed. It hired no less than 15 new partners and of counsels since last summer.

Of counsel Yoshihito Ueno, a recent lateral hire from Baker & McKenzie GJBJ, is praised by a Japanese securities firm client: "He has given us not only appropriate legal advice we ask for but also introduces innovative securitisation structures of various assets. He is particularly unique as a Japanese attorney in that he can advise not only from transactional attorney's perspective but also from tax viewpoints. We highly value and recommend his deep understanding of the business and legal-tax integrated service."

Though the market remains in a bit of a lull, the domestic side began to pick up late last year and Atsumi & Sakai's lawyers have been sought out for their quality local law expertise. There hasn't been a shortage of deals for the team. For example, last December, Ryuichi Nozaki represented a large securities company as an arranger in respect of the securitisation of lease receivables and instalment receivables. In March, Yasuhiro Shimada closed a syndicated non-recourse financing to a hospital valued at ¥20 billion ($260 million). "Partner Masaji Hashimoto is knowledgeable and detailed, we are very satisfied with his work products," says a happy client.

"Clifford Chance is a good all-round firm with a focus on primary and secondary capital markets in Japan," says a client, adding: "It has an extensive and deep knowledge in structured financing."

Possessing several highly respected practitioners on its roster, including Peter Kilner, Eiichi Kanda and Leng-Fong Lai, Clifford Chance maintains a standout structured finance and securitisation practice. In line with the growth objectives of the team, it recently poached two experienced multi-lingual lawyers from Allen & Overy, Wendy Yeo and Kaori Kino, and relocated Yasuko Moriwaki, a structured debt specialist from its London office last year. The expanded team has led to more work such as repackaging, structured notes issuances, CMBS and securitised debt portfolio sales, among others.

"It has an excellent structure to handle large flow work," says an investment banking client. "This is important in a climate where appetite for risk has diminished and where flow business has increased."

At the moment, Lai is acting for several securities firms on establishing repackaging and structured notes programmes. The firm's star trio of Kilner, Kanda and Lai, along with counsel Kenji Miyagawa have been working with a bank on the restructuring of its CMBS and non-recourse real estate loan assets. As the restructurings require many different structures, the Clifford Chance team has demonstrated its cross-disciplinary capabilities and strengths to be able to tackle such a multi-layered and complex transaction. In one landmark deal, Lai advised Citigroup Global Markets on the restructuring of $1 billion covered bonds that were issued by Korea-based Kookmin Bank back in 2009. These were the first covered bonds issued by an Asian issuer.

"Leng-Fong Lai is proving to be a reliable contact at Clifford Chance, and he is always available," says a director at a European investment house.

"I think they're legally very good, fair, quite commercially-minded," comments a banking client. "Specifically, the Tokyo office is quite commercially-minded, provides good practical advice and is quite a good value for money."

Noted partner Philip Hyde is the key contact for Hogan Lovells' structured finance and securitisation practice. A few market observers have questioned the team's depth in this practice area with the relocation of Andrew Carey from Tokyo to Singapore in April 2011. Senior associate Jonathan Green and associate Richard Bleackley filled in any gaps created by the move and were busy on several structured transactions. "Philip and Jonathan are both reachable, responsive, and provide quite considered practical advice," said a client. "I think they do so with consideration of commercial constraints."

The client continues: "To be honest, I'm pretty happy with their service. Also we have a relationship with them - if there were things they weren't doing well, I would feel comfortable picking up the phone and talking to them about it."

Hyde, Green and Bleackley continue to regularly advise a European lender on its structured finance deals, including regular issuances of collateralised loan notes (CLNs), collateralised debt obligations (CDOs) and repackagings. A venerable investment bank relies on the team for a number of its EMTN transactions.

As the only firm to appear in both the foreign law and local law rankings, Linklaters is a confident choice for top-tier advice in structured finance and securitisation. "They are a bit expensive, but the lawyers are well-trained and smart," noted a client. "All of them are a real pleasure to deal with."

Senior finance lawyer Paul Kruger departed last summer to help with the opening of the firm's new office in Abu Dhabi. Despite this loss, the team, under Andrew Carmichael and Akihiro Wani's leadership has transitioned smoothly and continues to provide its top-tier clients with advice on some of the market's most complex and prominent transactions. The firm's bench is deep, with over 30 lawyers exclusively dedicated to derivatives and structured finance work around Asia. Especially on the domestic derivatives front, Wani stands out and wins accolades from competitors. "I consider Mr Wani to be at the very top for derivatives work," says one.

Examples of the team's work include a number of market 'firsts' and those requiring novel structuring. For example, Carmichael led a team that advised a bank as the purchaser on a distribution finance programme. Here, the bank required a highly bespoke structuring programme from its legal team. The firm's structured credit derivatives practice is thriving, as it continues to advise market participants such as Barclays Capital, Bank of America Merrill Lynch and RBS on an array of issues including credit default swaps, credit-linked notes and credit/index-linked hybrid transactions.

"We believe Mori Hamada & Matsumoto is very positive for doing new types of transactions," says a local banking client, impressed with the firm's proclivity for creating novel financing structures.

At the beginning of the year, the firm's structured finance and securitisation team began to see more activity in its deal pipeline. These transactions have kept the practice busy and solidified its status as a go-to firm for high-end structured financing work. The well respected and experienced Masanori Sato and Takahiro Kobayashi lead the practice.

One area the firm hopes to capitalise on is the burgeoning Islamic finance scene in Japan. Last summer, Susumu Masuda, Naoki Ishikawa and Taro Omoto advised Nomura Holdings on the very first dollar-denominated sukuk (Islamic bond) for a Japanese company. It was issued out of Malaysia and valued at $100 million. This year, a team worked with Japan Airlines (JAL) on its refinancing that was necessary for it to complete its corporate reorganisation procedure. This was very high profile and followed closely by the domestic media. The Mori Hamada team assisted the airline to refinance its financial debt of ¥255 billion ($3.3 billion), achieving this under new loan documents entered into with 11 major Japanese lenders. Once this refinancing was complete, the Tokyo District Court declared the completion of JAL's corporate reorganisation process.

A star on the securitisation front, Nagashima Ohno & Tsunematsu remains at the forefront of this market. It boasts a robust deal flow, winning work consistently from loyal clients such as Mizuho Securities and Sumitomo Mitsui Banking Corporation. Although the size of the transactions may not be staggering, the novel structuring and creative approaches to the securitisations is what keeps the team at the top of the tier. Head of department Fumihide Sugimoto is considered a leading light.

In a deal for the Development Bank of Japan, Motohiro Yanagawa advised the lender as arranger and originator on a securitisation of loans against a local government that totalled ¥30 billion ($390 million). Yanagawa was instrumental again for client Mizuho Securities on a consumer finance loan securitisation that required a complicated master trust programme.

Nishimura & Asahi's all-star cast of practitioners and excellent banking client relationships buoy the firm in the first tier. In particular, partners Masaru Ono and Mitsuhiro Yasuda win compliments from peers and clients alike.

A team advised the Bank of Tokyo-Mitsubishi on its participation in a syndicated loan totalling ¥20 billion ($261 million). In another deal for private equity firm Carlyle, Masahiro Ueno helped it amend existing syndicated loan documents so that the borrower's shares could be listed on the Tokyo Stock Exchange (TSE). Demonstrating its ability to find creative solutions, Ueno and his team worked out that the existing leveraged buyout loan would continue to be outstanding after the borrower was listed on the Tokyo bourse, therefore, the terms of the loan agreement had to be amended to remove some of the borrower's covenants that were deemed inappropriate by the TSE.

Partner Hauro Narimoto of TMI Associates has been quite active in the structured and finance and securitisation area this year. Narimoto has advised a local government regarding a ¥8.5 billion ($1.1 billion) mezzanine loan to redevelop the area in front of a station.

Partners Yoshiyasu Yamagushi and Akihiro Tsukamoto have also advised a global alternative asset manager regarding ¥8.9 billion refinancing of securitisation structure of a nursery home.