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Global Investment Banking Review Full Year 2012

As the global economic downturn continues to affect countries across the world and particularly members of the eurozone, financial products and services are still being affected.

 

In 2012, fees for investment-banking services dropped by 3% to $74.8 billion.

This marks the slowest period since 2009 for investment-banking fees, covering everything from capital markets underwriting to M&A advice. There was a rise in the fourth quarter of the year, a 13% increase on the same quarter in 2011.

In Europe, where the single currency is still in trouble, fees took a 17% tumble from 2011 to $17.1 billion and Asia Pacific saw an 18% decline. There was some good news, however, as the Americas saw their fees rise 6% from 2011 and Japan by 18% over the same period.

 

1% decline in investment fees 

Financial sponsors and their portfolio companies were also hit during the year, recording a 1% decline in investment fees over the year to $10 billion. Leveraged-buyout fees comprised 37% of financial-sponsor-related fees throughout 2012 (a similar story to that seen back in 2008 when the financial crisis began). The Carlyle Group LP (and related entities) proved to be a big success story for the year, seeing an impressive 43% increase in investment-banking fees to $396 million. Goldman Sachs also had an excellent year, boasting 7.5% of financial-sponsor-related fees during the year, making it the industry leader for 2012.

 

Debt capital markets made up 30% of overall investment-banking fees

Debt capital markets made up 30% of overall investment-banking fees during the year, boosting its totals by 26% to $22.5 billion. However, M&A advisory fees were another casualty, dropping by 12% to $20.5 billion. Equity capital markets saw their slowest annual period since 2003, recording a 17% decrease to $15.6 billion. Meanwhile, the industrials, financials, materials and energy and power sectors made up 63% of the overall global fees in 2012.

JP Morgan was the year's big winner. The company took $5.6 billion in fees, which translated as 7.5% of the overall share. RBC Capital Markets also ranked well, gaining 0.8 points (the biggest increase). Barclays, Wells Fargo and Citi also followed closely behind in improving their share. Bank of America Merrill Lynch, however, saw a 6.5% decline in its fees to $4.9 billion.

 

Morgan Stanley took 10.7% of investment-banking fees in the technology sector

JP Morgan's success saw it lead the fee rankings for eight sectors for the year. Deutsche Bank did well in agency and government underwriting, with 6.3%, while Morgan Stanley took 10.7% of investment-banking fees in the technology sector for 2012.

Global Investment Banking Review Full Year 2012 - Written by Ross Stokes

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