Global investment banking fees drop 31% to lowest level in three years

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Global investment banking fees hit $56.7 billion in the first half of 2022, down 31% from the first half of 2021 and the slowest six-month opening period for IB global fees since 2019, according to global data provider Refinitiv.

Fees in the second quarter of 2022 were down 12% from the first quarter of this year, marking the slowest quarter for IB fees since the first quarter of 2019.

JP Morgan retained the top spot for investment banking fees collected in the first half of 2022 with $3.8 billion, retaining its ranking in the first half of 2021 and gaining a market share of 6.6%, despite a drop of 1.6 points in portfolio share.

While Goldman Sachs remained in second place with around 6.1% of global portfolio share, BofA Securities took third place with $2.8 billion in fees, and Morgan Stanley and Citi rounded out the top five. .

The Americas contributed 49% of all fees generated globally with $27.5 billion, down 38% from 2021 levels.

Fees charged in EMEA decreased 35% to $12.4 billion in the first half of 2022. Total IB fees in Asia Pacific reached $15.0 billion, down 9 % from H1 2021 levels, while investment banking fees in Japan fell 40% from a year ago.

ECM fees down 72%

With significant declines in IPOs, follow-ups and convertibles, Equity Capital Market (ECM) underwriting fees totaled $6.5 billion in the first half of 2022, down 72% from compared to 2021 levels and the slowest first half for ECM commissions since the first half of 2003, Refinitiv says.

Investors are becoming increasingly selective and refocusing on company fundamentals rather than “growth” stories and projections, especially given tight market liquidity and declining share prices of several companies that have become public in the past two years.

Paul Go, EY Global IPO Leader, said: “Investors are refocusing on companies with resilient business models and profitable growth, while integrating ESG into their core business values.

Once the current uncertainties and volatility pass, the many mega IPOs delayed in the first half should return. “However, strong headwinds are expected to persist. These include geopolitical tensions, macroeconomic factors, weak capital market performance and the impact of the lingering pandemic on global travel and related sectors,” Go said.

DCM’s underwriting fees were down 26% from the first half of 2021, while fees from the syndicated loan business were $13.3 billion, down 9% from a year ago. a year.

M&A advisory fees completed were down 6% from a year ago with $18.5 billion in fees worldwide, according to Refinitiv data.

Rising government fees

Global government and agency business expenses totaled $6.4 billion, up 12% from a year ago and the only sector to post year-over-year gains by compared to 2021, the global data provider said.

Financial sector imputed fees accounted for 32% of H1 2022 totals, down 31% from a year ago.

The retail and healthcare sectors saw the largest double-digit percentage declines from a year ago, down 60% and 55%, respectively, from the first half of 2021, a- he indicated.

(Reporting by Seban Scaria; editing by Daniel Luiz)

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