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

Although Romania was hit very hard by the financial crisis, the banking sector did not collapse. However, high unemployment rates, reduced disposable income, high interest rates and the unpredictable leu reduced demand and generated conservatism. "The banks are still quite cautious and conservative. In terms of security they're quite picky," one partner comments, with another saying: "They're very selective, conservative and have the ability to cherry pick projects. If there is a history of good projects and you can take it to completion, you can discuss. It's different to last year but there is still reluctance. It's moving slowly." Non-performing loans were characteristic of the aggravation of credit quality, and for many banks, all mentioned factors conspired against the sector's productivity. Consequentially, we have seen a rise in restructuring, debt recovery, forced execution and insolvency procedures.

While the trend in restructuring continues, there has been a lack, with a few exceptions, of an underlying market in the sale and purchase of distressed credit assets, despite its potential prospects for buyers. Rather than selling such assets, banks have endeavoured to reorient them, either to their associates or to new companies specially designed for the task. Moreover, we have also seen banks reduce their operational expenses; reassess their expansion plans and even exit Romania.

Nevertheless, while the last year has seen restrained activity from the banks, quiet optimism simmers below the surface. "2011 is completely different, there's a lot of new money," says one partner, adding: "We have eight facility agreements. It's very strange". Fresh money deals are on the rise and there is general feeling that while corporate finance is stabilising, this is not the case for the retail sector or project finance (or anything with a state element). Interestingly, there are also reports of German banks willingness to lend into Romania. This is so, even with German banks that have a real estate component. "Maybe it's a turning point," says one partner.

"Retail is a major issue of the banking system in Romania," says one partner, adding: "What is worrying is that individuals are not willing to take new loans. They prefer to postpone this. It is taking longer for retail to recover." There had been some legislative difficulties with there being a dissonance between domestic and international arrangements. In mid 2010, there was a government ordinance, which had introduced tough measures on banks in order to protect the borrower. Bank associations then reacted and won an amendment, which created conditions conducive for litigation on the lenders. Nevertheless, there have been efforts made with banks being carefully open to retail clients.

Badea Clifford Chance is a market leader and this fact remains uncontested. "Clifford chance is a worldwide name with the capacity and number of transactions to be in tier one," says one partner. "Clifford Chance is in tier one because they're great in finance law across Europe and there's nothing in the structure in Romania that prevents that," another rival says.

Clients have reported their satisfaction with the firm's service. "It is obvious from their approach they are part of a large, international-focused network, which is beneficial for the Romanian legal market," one client says.

In contrast to other firms with international representation, Badea Clifford Chance is integrated in the Romanian market. "It is more attractive to have one law firm," says one partner. The firm now represents all the major international and investment banks in Romania on a considerable number of cross-border finance transactions. Over the last year, driven by Daniel Badea, the firm has been involved in some high profile mandates.

Closed in November 2010, the firm advised lead arrangers ING and Rabobank with regard to a €694 million loan for commodities trader Nidera. Additionally, the firm supported UniCredit on a €45 million development and investment loan facility for the construction of a retail centre in Craiova. This was engaged by a joint venture of Bel Rom, which involved co-financing of the development by Auchan. The firm also supported agent and lenders BRD - Société Générale in connection to the refinancing of an existing syndicated facility of €60 million to Hidoconstructia.

"They are a lot more expensive," one competitor says. However, as one client puts it: "They're not cheap but it is premium quality. They're in the premium segment."

It's no secret that CMS Cameron McKenna has a dominant presence in Central and Eastern Europe (CEE). Nevertheless, there have been whispers from competitors, which suggest that the banking and finance practice is a bit depleted since Todd Robinson's departure from the management role. However, any such impact can only be relative to the pre-existent market share of the firm as it is another of those international firms, which has successfully integrated into the Romanian market. Furthermore, very few would challenge CMS Cameron McKenna's proficiency in banking.

Simon Dayes is a well-respected figure on the market and he is often drawn out for praise in both the personal and professional capacity. "Simon Dayes is one of the best finance lawyers here [in Romania]," says a peer.

Clients have expressed their satisfaction with the work of the firm. "They're very very good. Good quality, professional. The team is very professional," says one, adding: "I recommend them to other banks because I'm pleased."

Over the last 12 months, CMS Cameron McKenna has been active in a number of high value deals. At €80 million, the firm was involved in one of the highest profile private sector and real estate financing deals of the year. It advised lead arranger, Alpha Bank Athens and syndicate banks EFG Eurobank and Bank of Cyprus on the investment finance for the City Gate two-tower office building development in Bucharest (for GTC). Furthermore, the firm demonstrated its inclination towards cross-border finance when it advised ING as lead arranger, in a €300 million medium term factoring programme for Arcelor Mittal group.

Musat & Asociatii is a Romanian brand, which has developed itself a formidable reputation on the market. It has been the source for spin-offs and low cost alternatives and this is testament to the space the firm has traditionally occupied. However, on the banking side, competitors are starting to query the dominance of the firm on the legal landscape. "Musat organise themselves differently. They have a different setup. Some do finance but none specialise in working for banks," says one partner, adding: "They don't organise on the cross-border basis. We haven't seen them in banking for a while." Another partner says: "I'm unsure about Musat. I don't know if they have a specialised team and they're not on the panel of so many banks. They are one of the top three law firms, so it's a tradition that they're there."

Nevertheless, in spite of reservations held by peers of the firm, clients have been in no doubt about the quality of the service provided. "Musat & Asociatii is one of the best Romanian law firms we have had the chance to collaborate with. They possess an impressive knowledge of the legal sector, being very practical and dedicated. I've noticed their business awareness, being able to combine legal matters with business related issues," says one client. Another says: "We rate our overall experience with the firm as excellent, as we have been working with them for more than ten years and they have been very professional every time we have requested their advice. They stand out for the full spectrum of legal services they are providing at the highest level".

Moreover, clients have been full of praise for Catalin Baiculescu and Miruna Suciu. "We must single out Catalin Baiculescu, who is one of the most talented lawyers on the local market. Straight-forward and skilled, Catalin has an original approach and gives us both innovative and practical solutions on the most sensitive legal issues," says one client, adding: "We have worked with Miruna Suciu, a hands-on lawyer and natural-born negotiator, with a remarkable expertise both in the finance sector, as well as in the capital markets area.

This year the firm advised the European Investment Fund in connection with a "First Loss Portfolio Guarantee" granted to BCR and Raiffeisen Bank. This was connected to an agreed portfolio loan volume of €315 million in the context of the operation of Jeremie (Joint European Resources for Micro to Medium Enterprises). Furthermore, the firm advised Gabriel Resources with regard to the negotiation of a complex credit arrangement with several lenders. Exceeding €1 billion, this is aimed at financing the mining investment project for the exploration and exploitation of the biggest gold and silver mining site in Europe: Rosia Montana (in Romania).

"I have endless admiration for Nestor," says one peer, adding: "They're focused on banking and have the strength and depth". Nestor Nestor Diculescu Kingston Petersen is another of those domestic firms steeped in history and a prominent symbol of the traditional order. On the back of substantial experience, the firm has carved itself a reputation as the firm to turn to when foreign investors enter the market. "I have had very positive experience with Nestor on a few occasions and would work with them again," says one happy client.

With over 35 years of experience, Manuela Nestor is one of Romania's leading commercial lawyers and fronts the Banking, Finance and Capital Markets practice of the firm.

This year, the banking team has been very active with regard to the restructuring of cross-border or domestic financing facilities, identifying possibilities of recovering debt and, consonant with a positive market trend, new money financings. In one of the more important financings of late, the firm advised the Den Braven Group with respect to Romanian law issues in connection with a €75 million refinancing facility extended to the group by a bank syndicate. Additionally, the firm advised the Korean Development Bank, the arranger and lenders, on a €20 million and €15 million working capital and refinancing facilities granted to the local subsidiary of a large Korean industrial conglomerate.

On the restructuring side, NNDKP advised Globe Trade Centre with regard to the restructuring of the €30 million financing facility granted for the development of a complex of residential buildings, FeliCity, in northern Bucharest. The firm also advised the same client with regard to the restructuring of the €27 million financing facility granted for the development of a complex of residential buildings, Rose Garden, in northern Bucharest.

Bulboaca & Asociatii is a solid practice with a very healthy deal flow. This year, the firm retains and strengthens its position in the second tier. Market commentators are unanimous as to the banking practice's quality and express their satisfaction that the firm has earned its place among market players. "Bulboaca is in the right place," says one peer, adding: "We see them on more deals". Another says: "Bulboaca have a good track record in banking."

Adrian-Catalin Bulboaca is a well-respected individual with a strong reputation. The market has not been short of praise for the firm with another partner saying: "Bulboaca is coming up from the Linklaters pedigree for finance work. They're seen on the other side quite a lot. They're quite proficient, good professionals."

There is nothing in the deal list of the firm that would stand opposed to the observations above. The firm has been highly active and is engaged in work for some high profile clients. In the last 12 months, the firm advised JPMorgan Europe with regard to the restructuring of a €674 million secured facility arranged for the acquisition of a German automotive company. Furthermore, the firm advised BNP Paribas in relation to a €29 million loan provided to Perissa Maritime for the purpose of financing part of the acquisition cost of a ship from Daewoo Mangalia Heavy Industries. On the real estate side, the firm advised Credit Europe Bank in the restructuring of €30 million loans to Can Serv for the development of a residential apartment building in Bucharest. The firm also advised the Romanian branch of a leading Greek bank with regard to the €90 million restructuring and increase of the existing financing for the development of a residential park.

Market players have noted the increased visibility of Schoenherr si Asociatii. The space the firm occupies is no doubt helped by the representation they secure among Austrian banks and companies. I'm a fan of Schoenherr, they're in the right place," one peer says, adding: "Matei Florea is a genuine banking guy through all the implications of lending cross border." This year the firm has strengthened its reputation in domestic and cross border finance and will be looking to push ahead in the coming editions.

Led by Ioana Florescu on the Bucharest side, Schoenherr acted as the Romanian, Austrian, Hungarian and Slovak counsel to the agents and arrangers Deutsche Bank and Commerzbank in regard to €14 billion term and revolving facilities and a €3 billion forward start facility for German automotive components supplier Continental. Furthermore, owing to the current market situation, the firm has been engaged in novel solutions pertaining to the structuring of securities packages. Firstly, in the real estate sector, the firm advised Erste Group Bank and a club of lenders on the €120 million refinancing of Sun Plaza. Sun Plaza is one of the largest shopping malls and the only one to open in Bucharest in 2010. Moreover, this was one of the largest real estate financings of 2010. Secondly, the firm advised ING as facility agent in connection to a €75 million senior facility extended to a group of companies active in the field of professional insulation materials.

On the regulatory side, Schoenherr's Bucharest team advised Volkswagen on Romanian financial services regulation in connection to the client's Austrian and CEE (Central 7 Eastern Europe) aspects of the creation of an integrated automotive group with Porsche led by Volkswagen.

In this edition, Tuca Zbârcea & Asociatii retains and consolidates its position in the second tier. The future looks very promising for the firm and its prospects are a source for animated discussion. In light of a market that is increasingly competitive the tussle for higher places, looking ahead, will be very interesting. "Tuca will become a relevant player," says one competitor, adding: "Tuca will develop to being there. They did not have a banking team until last year. They will be more active this year. They brought in a senior associate from Cameron McKenna. He worked with Simon Dayes."

The senior associate alluded to is Mihai Dudoiu. Hired in May 2009, Mihai has developed a strong reputation on the market and has recently been promoted to partner status at the firm. The firm has been building its practice with a series of recruits and internal promotions. "Tuca have a new generation. They are young and will develop," another competitor says. However, this optimism is not unanimous, as one partner says: "Tuca have a senior associate from Cameron McKenna. They're good but not a competitor."

"Tuca is different from the normal law firm. In the mould of Musat they do a lot of government liaison work. They'll introduce you to the government," says one partner, adding: "They've done well. They're well connected but it's pretty much local banking work. They're good draftsmen".

This year, the firm is involved in some interesting mandates. Presently, the firm is acting as designated lead Romanian advisor to Caterpillar Financial, ING, Investec Bank and UniCredit as lead arrangers of €84 million term and revolving senior credit facilities to be granted to a leading European company active in mining operations. The firm also worked for Caterpillar Financial in relation to a €15 million equipment lease facility proposed to be made available to a Romanian mining company. Additionally, Tuca Zbârcea & Asociatii counselled Investkredit with regard to the restructuring of the €28 million credit facility agreement made available to a Romanian group of companies for financing the development and operation of an office and commercial project in Timisoara, Romania.

Gide Loyrette Nouel has had a consistent year and is a firm that operates well within its spheres of influence. "Gide is okay and traditionally does work for the local subsidiary of Société Générale," says one peer, adding that they get finance work from French clients".

This year, the firm was active advising foreign banks and development finance institutions. The firm advised BRD Société Générale and Romanian Commercial Bank (BCR) – ERSTE Group with regard to a €100 million financing for the development and modernisation project of the National Company Bucharest Airports.

Competitors note that Popovici Nitu & Asociatii do not have a specialised banking and finance team. However, the firm is active and attracts interesting mandates, including coming head to head with Gide Loyrette Nouel on a €100 million loan granted by BCR and BRD Société Générale, represented by Gide, for the construction of a new terminal at the international airport.

In another deal, the firm counselled Hidroconstructia on the refinancing of a €60 million syndicated loan by BRD Société Générale.

RTPR in association with Allen & Overy has a banking practice which is growing in stature and some commentators suggest it should be as high as tier one. "We interact with them a lot. They have a continuous stream of transactions," says a competitor.

The firm advised an international financial institution with regard to a €126 million financing, part of which was syndicated by commercial banks, to aluminium company Alro. This was done in order to help the company refinance most of its existing debts and enable it to pursue its objectives in aluminium production.

Salans move up a tier into the third band this year based partly on the recommendations of key market players.

The firm is renowned for its real estate finance capabilities and, amid difficult market conditions, it continued to be active in this sector.

The firm advised Raiffeisen Bank and Raiffeisen Bank International with regard to the €26 million restructuring of finance documents and increase of the security coverage by new mortgages in the Rose Garden residential project. It also provided legal assistance to Ermes holding in relation to the restructuring of the €80 million financing of Era Shopping Park, Iasi, and supported the European Fund for Southeast Europe in arranging the restructuring of the club deal financing granted to an important Romanian financial institution.

"They can provide English and New York law advice," says one competitor alluding to the firm's cross-border capabilities.

Apart from advising a consortium of leading global banks in a multi-jurisdictional €690 million financing package linked to CVC capital partner's acquisition of InBev, Kinstellar also advised Commerzbank, as agent in connection with the amendment and restructuring of pre-existing facilities granted to RailOne and Basler.

"I would like to mention Kinstellar for their quality of advice and commitment, especially in real estate and banking/finance," says one client.

After attracting a healthy flow of mandates, Reff & Associates earns itself a place in the fourth tier this year. The firm acted as exclusive legal advisor to the Bank of Cyprus in the structuring and implementation of the first large financing transaction concluded in the real estate sector in Romania in 2011. The firm assisted in the loan facility provided to Nova Imobiliare for the development of the first and second phase of the Colosseum shopping centre in Bucharest.

In another deal, the firm acted for three prominent Romanian companies in retail, FMCG and real estate with regard to the restructuring of several loan agreements totalling €500 million.

Zamfirescu Racoti Predoiu has spent the year advising Bancpost on regulatory matters and on issues pertaining relation to banking operations in order to optimise the bank's performance. The firm has also assisted clients including Banca Italo Romena, Romconsulting Group and Tezaur Imobiliare in regard to the transfer of loan portfolios.