Middle East's investment banks struggle in 2015 while mergers skyrocket

The Middle East’s investment banks recorded 22 percent less in fees over the first nine month of 2015 than last year according to Thomson Reuters' quarterly investment banking analysis for the region.

Thomson Reuters estimates Middle Eastern investment banking fees reached just above $480 million during the first quarter of 2015 -- that 22 percent decrease makes it the worst third-quarter total for the region’s investment banks since 2012.

Not a single investment banking component made year-over-year percentage gains during the first nine months of 2015. Equity capital market underwriting declined by 3 percent over last year, with fees from completed merger and acquisition transactions reducing 1 percent.

Nadim Najjar, Thomson Reuters Managing Director for the MENA region, said the lowered fees taken in by investments banks is somewhat offset by higher rates of mergers and acquisitions, though.

"The value of announced Mergers and Acquisitions (M&A) transactions with any Middle Eastern involvement reached $33.7 billion during the first nine months of 2015, 23 percent more than the value registered during the same period in 2014 and marking the best annual start since 2010," Najjar said.  

The third quarter also saw an equity issuance total of $2.6 billion, showing a slight decrease from the second quarter of 2015. Debt issuance in the Middle East, however, was more than $16 billion during the third quarter – more than double the amount raised during the second quarter.

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