Investment banking fees survey: Under pressure

Sep 25, 2013

Banks are earning about as much in fees as they were a year ago, with a burst of ECM activity compensating for a sharply slower M&A market. Much now depends on market stability in the months ahead

By Ben Miller

Volatile US Treasury markets and flagging regional economic growth have thrown up fresh challenges in 2013 for Latin America’s corporate borrowers.

But such pressure has so far this year failed to make a dent in the earnings of the investment banks that service them: fees are roughly flat on last year, thanks largely to the overall resilience of the main business lines — even though the sources of that revenue have changed.

Equity capital market activity picked up pace this year, helping compensate for a slump in mergers and acquisitions. And despite uncertainty over the direction of interest rates, debt capital market revenue is down only slightly on last year, tracking overall volume.

The fee pool for LatAm investment banking — combining revenue from DCM, ECM, M&A and loans — had reached $1.28 billion this year through September 6, according to Dealogic data. This was up a hair...

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