China’s investment banking fees drop 33% as ECM falls to 15-year low

The value of IPOs by Chinese issuers also fell to a decade low.

Investment banking fees generated in China dropped 33% to $5.6b in the first six months of 2023, according to data from the London Stock Exchange Group (LSEG).

Equity capital markets (ECM) underwriting fees accounted for a large portion of the plunge, dropping 75% to $645.8m in H1 compared to H1 2023. It accounted for 12% of the investment banking fee pool.

This comes as China’s ECM total fell to its lowest first half period since 2009. The country’s ECM raised just $26.6b in the first half of 2024– a 66.2% decline in proceeds compared to the first half period of 2023. 

Traditional initial public offerings (IPOs) by Chinese issuers have fallen to a decade low, plunging 81.7% to $5.8b. The number of IPOs is down 65.5% in H1 compared to H1 2023.

Debt capital markets (DCM) underwriting fees fell by 7% to $4.3b over the same period. 

Primary bond offerings from China-domiciled issuers raised $1.5t, a 1.8% decline compared to a year earlier.

Completed M&A advisory fees were also 26% lower at $264.5m in H1. 

Syndicated lending fees reached just $332.8b, a 52% decline.

CITIC is named the leading financial institution in LSEG’s China investment banking fee league tables, with $452.5m in related fees. CITIC also occupies an 8.1% wallet share in H1 2024, according to LSEG.