Highest Fee Income: According to an industry analysis, investment bankers were laughing all the way to the bank in the first nine months of 2023, as their fee income increased by 41% year-over-year to USD 967.5 million despite a significant drop in deals.
According to Refinitiv, an LSEG (London Stock Exchange Group) business, completed M&A advisory fees increased by 34% year-over-year and totaled USD 362 million from January to September 2023, while ECM (equity capital market) underwriting fees increased by an even steeper 38% to USD 194.3 million.
Debt capital market (DCM) underwriting fees totaled USD 181.7 million, a 41% increase from the previous year, while syndicated lending fees grew 56% to USD 229.5 million in the first nine months of 2023, according to Lucille Jones, an analyst at LSEG. During the same period, the total fee income for the sector increased 41% to USD 967.5 million.
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Investment Bankers See Highest Fee Income
With a total of USD 58.6 million in investment banking fees, or 6.1% of the wallet share of the i-banking fee pool, the domestic arm of Wall Street titan Citi ranked first among all investment banking firms.
Despite a 56.6 percent drop in India-bound M&As to a three-year low of USD 65.6 billion in the first nine months of 2023, the fees increased, while the number of deals increased by 3 percent year-over-year.
Similarly, India-targeted mergers and acquisitions reached USD 60,5 billion, a 56.8% decrease from the previous year and the lowest first nine-month period by value since 2020. Domestic M&A transactions totaled $44.1 billion, a 59.7% decrease compared to the same period in 2022.
Inbound M&As totaled USD16.4 billion, a decrease of 46.6% from the previous year, while outbound M&As reached USD4.8 billion, a decrease of 46.5 percent year-over-year, with the United States being the most targeted nation with a 24.6% market share.
The majority of deal making activity involving India targeted the financial sector, which totaled USD30,6 billion (down 55.9% in value) and accounted for 46.7% market share, followed by industrials at USD7,7 billion (down 32.4%) and 11.7% market share.
High technology, which saw the most transactions announced during the period, captured 9% of the market with USD5.9 billion in deals, a decrease of 71.7% from the previous year.
Private equity-backed mergers and acquisitions totaled USD11.1 billion, a decrease of 58.1% from the prior year and the lowest first nine-month period by value since 2020.
In the first nine months of 2023, equity capital markets (ECM) raised USD 18.4 billion, a 34.4% increase compared to the same period in the previous year. The number of ECM offerings increased by 30.4% year-over-year to 253 equity and equity-linked issuances.
During the first nine months, initial public offerings (IPOs) in the ECM sector raised USD3.5 billion, a decrease of 38.1% by proceeds, but the number of IPOs increased by 35.2%. The proceeds from follow-on offerings, which accounted for 81 percent of the total ECM proceeds, increased by 85 percent year-over-year to $14.9 billion, while the number of follow-on offerings increased by 24.4 percent.
The financial sector accounted for the preponderance of ECM issuance with a 19.8% market share or USD3.6 billion, down 6.2% year-over-year. Industrials captured 18.3% of the market, followed by advanced technology (11.5%) and materials (11.2%), each with 11.2% of the market.
Jefferies ranks first in the ECM underwriting industry with USD2.3 billion in related proceeds and a market share of 12.4%.
On the debt capital markets, primary bond offerings brought in USD65,1 billion during the first nine months, a 39.3 percent increase in proceeds and the highest nine-month period since 2019’s first nine months.
Financial sector issuers captured 78% of the market at USD 50.8 billion, an increase of 61.6%, followed by industrials with 5.6% of the market at USD 3.7 billion, an increase of 86.3%.
With related proceeds of USD 10.96 billion and a 16.8 percent market share, ICICI Bank ranks first in bond underwriting.
