Investment banking fees surge by 11% to $580.7m, led by Mitsubishi UFJ

The $14.1b merger of NBAD and FGB was the largest M&A deal from the region so far this year

Investment banking fees across the Middle East surged 11 per cent to $580.7 million (Dh2.13 billion) for the first nine months of 2016 compared to the same period last year, according to data from Thomson Reuters/ Freeman Consulting.

Equity capital markets (ECM) underwriting fees declined 64 per cent to $29.1 million, marking the slowest first nine month period since 2009, while debt capital market fees increased 64 per cent to $83.2 million.

Syndicated lending fees accounted for 53 per cent of the overall Middle Eastern investment banking fee pool, the highest first nine months share since 2002. Completed M&A advisory fees accounted for 27 per cent of fees in the region, while debt and equity capital markets underwriting fees accounted for a combined 19 per cent.

Fees generated from completed M&A transactions totalled $158.3 million during the first nine months of 2016, a 23 per cent decrease compared to a year ago and the slowest first nine months for M&A fees in the region since 2012.

“The value of announced M&A transactions with any Middle Eastern involvement reached $37.4 billion during the first nine months of 2016, 19 per cent more than the value recorded during the first nine months of 2015 and the highest first nine month total in the region since 2010.” said Nadim Najjar, Managing Director, MENA, Thomson Reuters.

The $14.1 billion merger of National Bank of Abu Dhabi and First Gulf Bank was the largest deal to be announced in the region so far this year, it is the largest domestic Middle Eastern deal of all time. Boosted by this deal, domestic and inter-Middle Eastern M&A increased 149 per cent year-on-year to $20.5 billion.

Credit Suisse, which advised the Abu Dhabi banking merger with UBS, topped the first nine months of 2016. UBS ranked second.

Mitsubishi UFJ Financial Group earned the most investment banking fees in the Middle East during the first nine months of 2016, a total of $36.5 million for a 6.3 per cent share of the total fee pool.

Rothschild topped the completed M&A fee rankings with 12.9 per cent of advisory fees.