Islamic debt issuance reached $23.9 billion from 58 issues, up 66% from 2010, according to a report.
“The top Islamic issuer was again Malaysia with 63% of activity. Issuers in the financials sectors accounted for 66% of the DCM issuance in the Middle East last year,” Thomson Reuters in its latest review said.
Middle Eastern debt issuance reached $29.5 billion during 2011, down 20% from 2010. Investment grade corporate debt accounted for 35% of all Middle Eastern DCM activity in 2011.
Thomson Reuters regional investment banking (IB) review for 2011 shows equity capital market issuances grow to $10.2 billion but overall IB fees drop by $271.6 million.
CIMB Group took the top spot in the Islamic bond ranking in 2011 with 27 issues which raised $5.1 billion.
Equity capital markets (ECM) issuance in the Middle East reached $10.2 billion during the full year, a 47% increase compared to 2010 when volumes touched $6.9 billion.
The review examines the performance of the Middle East investment banking industry in the region’s debt and capital markets, both conventional and Islamic. It includes dedicated regional rankings of banks and advisors operating in the Middle East based on their deals and fees.
“Undoubtedly the major factor adversely affecting investment banking in the Middle East this year was the Arab Spring. This was clearly illustrated by the $271.6 million fall in investment banking fees, reflecting the decline in overall activity throughout the region compared with 2010,” Russell Haworth, Managing Director of Financial Services, Middle East and Africa at Thomson Reuters, said.
Investment banking fees in the Middle East only reached $406.8 million during the whole year, which was a 40% decline compared to 2010, when fees were calculated at $678.4 million. Fees for mergers and acquisitions (M&A), which accounted for 54% of the overall fee pool, totalled $221.2 million during the 12-month period, down 37% from 2010.
Debt capital markets (DCM) fee activity in the Middle East fell 66% from 2010 to $55.6 million in 2011. Fees from syndicated lending and ECM totalled $47.8 million and $82.1 million respectively.
HSBC held the top spot in the Middle Eastern DCM and the syndicated loan fee rankings for 2011 earning $8.6 million and $5.2 million respectively. Goldman Sachs topped the M&A fee rankings during the year with $14 million. Bank of America Merrill Lynch controlled 13% of ECM fees in the Middle East.
According to the review, Middle Eastern targeted M&A activity reached $10.1 billion for the full year, down 43% compared to 2010 when activity totalled $17.7 billion. Real estate remains the most targeted industry in the Middle East with $2.6 billion, 26% of the activity down from $4.8 billion during 2010.
The United Arab Emirates was the most active Middle Eastern country with $4 billion, for 39% of annual activity. BNP Paribas topped the Any Middle Eastern Involvement M&A ranking with $10.1 billion. RBS topped the Middle Eastern target M&A ranking with $980 million, bolstered by advisory work for Aujan Industries-Beverage.
In ECM issuance follow-ons accounted for 62% of the year’s activity and the top Middle Eastern ECM transaction was the $3.5 billion follow-on from Qatar National Bank (QNB). Financials was the most active industry in the Middle East during the year (70% of all activity), with real estate, materials and energy and power sectors together accounting for 24% of ECM activity. Al Rajhi Banking & Investment topped the Middle Eastern equity capital markets rankings as sole-lead book runners for Saudi-based Jabal Omar Development’s $688 million follow-on offering.