Investment banking took a hit in August following increased market volatility and downward trending markets that gave many corporates a sense of unease when raising capital.
Barclays Capital reports that announced M&A volume fell 23% year-on-year to $199 billion. Completed volume also fell to $176 billion, down 8% from last August.
From the research note:
August equity underwriting volume declined 73% sequentially to $16bn. Volume was substantially slower across all products with IPO’s lower by 57%, follow-on volume down 81% and convertibles down 60%.
Global debt underwriting volume declined 13% during August to $325bn and was 25% lower than August 2010. Volume during the month was driven by weaker volumes across most products. Corporate investment grade issuance declined 32% sequentially to $85bn, high yield issuance declined 88% to just $3bn, and combined ABS/MBS volume declined 54% to $24bn.
But sales and trading desks may take solace; the high volatility has trading activity and commissions improving. League tables out of Thomson Reuters show Goldman Sachs and JP Morgan leading, each with more than $400 billion so far this year. Morgan Stanley is close behind with $399 billion from 221 deals.
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