Singapore investment banking fees plummet 49.4% in H1

Fees from completed M&A, ECM, DCM, and syndicated lending all registered declines.

Singapore’s investment banking activities totalled $326.55m (US$233.9m) in the first half of 2020, a 49.4% YoY drop compared to H1 2019, according to data from Refinitiv’s preliminary review. All asset classes reported declines.

Advisory fees from completed mergers and acquisitions (M&A) amounted to $61.01m (US$43.7m) this year, down 66.9% YoY from the first half of 2019. Equity capital markets’ (ECM) underwriting fees fell 6.6% YoY from a year ago to $125.51m (US$89.9m), whilst fees from debt capital markets (DCM) underwriting also declined 55.3% YoY, totaling $ 64.08 (US$45.9m).

Syndicated lending fees also declined 58.4% YoY from a year ago and generated only $75.95m (US$54.4m).

DBS Group has taken the lead in investment banking fees so far this year, with a total of $79.16m (US$56.7m) or a 24.2% wallet share of the total fee pool.

Overall announced M&A activity slowed down and reached $52.77m (US$37.8b). In May 2020, M&A activity for any Singapore-involvement saw the lowest monthly total since February 2019.

Singapore-targeted M&A activity amounted to $31.69b (US$22.7b), a 3.3% YoY decline compared to the same period in 2019. Inbound M&A activity fell 53.3% from the first half of last year to $6.28b (US$4.5b), whilst outbound M&A activity declined 18.6% from a year ago to $15.5b (US$11.1b) in deal value.

Some bright spots continue to exist in the investment banking space, however. Domestic M&A in Singapore hit a record semiannual period and totalled $25.41b (US$18.2b) so far this year, up 31.6% from a year ago.

CapitaLand Mall Trust and CapitaLand Commercial Trust also announced a proposed merger valued at $11.17b (US$7.998b) which is currently the biggest Singaporean M&A deal so far this year, and the largest domestic Singaporean deal on record, according to Refinitiv.

Majority or 46.5% of the deal-making activity involved the real estate sector. Activities related to the sector amounted to $24.57b (US$17.6b), which is 55.4% lower from H1 2019. Industrials took second place, with an 24.4% market share, followed by energy and power with 5.3% market share.

Amongst the banks, Credit Suisse leads the rankings for Singapore involved-announced M&A, with 36.1% market share and $18.99b (US$13.6b) in related deal value. Deloitte follows in second place with 23.7% market share, whilst DBS Group takes third spot with 23.0% market share.