How Have Equity Underwriting Deals Closed By U.S. Investment Banks Trended In The Last 5 Quarters?
Deal size for equity capital markets worldwide shrunk in the last quarter of the year after recovering from the unusually low levels seen in the beginning of the year over Q2 and Q3. Weaker equity capital market conditions over Q4 2016 resulted in deal volumes for the largest U.S. investment banks shrinking by 8% quarter-on-quarter – in line with the 8% reduction in total market size witnessed over the period.
The chart below captures the total size of equity capital market deals completed by the five largest U.S. investment banks since Q4 2015. The green-to-red shading for figures along a row show the variations in deal size for a particular bank over this period.
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Equity underwriting volumes for individual banks were taken from Thomson Reuters’ investment banking league tables for the last five quarters. The table below captures the respective market shares for each of these banks over this period. The green-to-yellow shading for figures in a quarter should help compare the relative standings of these 5 banking giants in a particular quarter.
It should be noted that the largest equity capital market deals (IPOs and FPOs) employ more than one investment bank, so the market share figures are not exclusive.
These banks captured the top five ranks in the global equity underwriting league table for full year 2016, although Credit Suisse captured the number 5 spot from Citigroup for Q4 2016. Notably, combined market share for these five banks has shrunk over recent quarters – primarily due to the sharp increase in equity underwriting volumes in China over recent quarters. The investment banking industry in China is considerably fragmented, with local players capturing a sizable share of the market. An increase in the market share of local players, coupled with high deal volumes for the country in the last few quarters resulted in each of the top-4 Chinese banks (Bank of China, ICBC, CCB and Agricultural Bank of China) figuring in the list of global top 20 equity underwriters for 2016.
You can see how changes in Bank of America’s share of the equity underwriting industry impact our price estimate for the bank’s shares by modifying the chart below.
See the links below for more information and analysis about the 5 largest U.S. investment banks:
- How Much In Equity Capital Market Deals Did The 5 Largest U.S. Banks Underwrite In Q4?
- How Much In M&A Advisory Fees Did The 5 Largest U.S. Investment Banks Generate In 2015?
- How Much In Equity Underwriting Fees Did The 5 Largest U.S. Investment Banks Generate In 2015?
- How Much In Debt Origination Fees Did The 5 Largest U.S. Investment Banks Generate In 2015?
- How Have Equity Underwriting Fees For The 5 Largest U.S. Investment Banks Changed Since 2010?
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