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Global investment banking fees fall 29% in Q1, worst since 2009

[LONDON] Global investment banking fees fell 29 per cent in the first quarter of 2016 from a year earlier as market volatility put a brake on dealmaking and equity and debt capital markets activity, Thomson Reuters data published on Monday showed.

Global fees for services ranging from merger and acquisitions advisory services to capital markets underwriting reached US$16.2 billion by the end of March, the slowest first quarter for fees since 2009.

Regionally, fees in the Americas totalled US$8.7 billion, down 32 per cent from last year. Fees in Europe were down 27 per cent at US$3.9 billion and the Asia-Pacific region saw an 18 per cent decline to US$2.6 billion.

Investment banking income was dragged down across all products as global markets were hit by volatility sparked by global growth worries, geopolitical tensions in the Middle East and a China slowdown.

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Company boards and their chief executives were deterred from pulling the trigger on big transformative deals, in contrast to the record levels of activity seen last year, although the quarter saw a flurry of Chinese companies seeking Western targets.

Equity capital markets fees saw the steepest decline of 48 per cent compared to a year ago, followed by a 26 per cent fall in debt capital markets fees and an 18 per cent decline in M&A revenue.

JPMorgan topped the global league table for fees, drawing in US$1.2 billion during the quarter, a decline of 23 per cent compared to a year earlier but gaining slightly in overall wallet share.

The top five banks were all American, but European banks Barclays and Credit Suisse each gained one place to rank sixth and seventh respectively.