Investment banking fees in Singapore surge 34.4% to hit US$1b in 2021 to date

INVESTMENT banking activities in Singapore have raised US$1 billion in fees so far this year, a 34.4 per cent increase from 2020 as mergers and acquisitions (M&A) activity hit a record high.

According to preliminary data from Refinitiv released on Wednesday (Dec 22), the growth in investment banking fees was largely buoyed by a 91.1 per cent growth in advisory fees for completed M&A, which amounted to US$349.2 million so far this year.

This comes as M&A activity in Singapore witnessed a record period of deals amounting to US$175.1 billion (see amendment note) so far in 2021, up 70.4 per cent from the previous year mainly due to the US$31.1 billion de-SPAC transaction of Grab and Altimeter Growth Corp.

Over the year, Singapore saw a total of 7 de-SPAC transactions totalling a combined value of US$42.8 billion, as opposed to just 1 deal last year. Singapore-targeted M&A activity amounted to a combined value of US$94.7 billion, up 97.8 per cent compared to 2020.

Morgan Stanley led in the M&A league table rankings for any Singapore involvement, accounting for 32 per cent of market share and US$56 billion in related deal value.

Debt capital market (DCM) underwriting fees, too, surged 87.6 per cent from a year ago to hit US$182.6 million as primary bond offerings from Singapore-domiciled issuers witnessed a record period to raise US$45 billion so far this year.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

This represents a 67.3 per cent increase compared a year ago, with Singaporean companies from the financial sector capturing more than half (55.2 per cent) of market share to raise US$24.8 billion so far this year, up 84.5 per cent from 2020.

The top Singaporean bond deal this year was a combined US$2.5 billion bond offering priced by Temasek in July.

Green, social, sustainability and sustainability-linked bonds from Singapore issuers notably accounted for 20 per cent of the total bond proceeds in 2021 after raising US$9.2 billion.

DBS led the Singapore bonds underwriting activities with US$7.4 billion in related proceeds, capturing about 16.4 per cent market share.

Meanwhile, equity capital market (ECM) underwriting fell 19.3 per cent from the year before to US$229.3 million as follow-on offerings fell 18.4 per cent from the previous year despite a higher number of follow-on issues.

Equity and equity-linked issuance by Singaporean companies raised US$11.9 billion, relatively unchanged from 2020.

Sea's US$3.5 billion primary follow-on offering marked the largest Singaporean ECM deal this year, while High Technology accounted for 58.4 per cent of Singapore's ECM proceeds.

The ECM underwriting rankings were led by BofA (Bank of America) Securities with a 20.6 per cent market share and US$2.5 billion in related proceeds.

READ MORE: 

• Grab's share price slide a reminder of risks in any de-SPAC
• Sea's mega US$6.3b fundraising will test market appetite for e-commerce ambition 
• M&A activity within Singapore and region expected to remain robust

Amendment note: An earlier version of this article misstated the total deal value of M&A activity. The story has been amended to reflect the correct amount.