Thomson Reuters Q1 16 DCM Review - Goldman on the rise

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Global debt capital markets activity falls 8%

Overall global debt capital markets activity totaled US$1.6 trillion during the first quarter of 2016, an 8% decline compared to the first quarter of 2015 and the slowest opening period for global debt capital markets activity since 2008. First quarter global debt activity increased 41% compared to the fourth quarter of 2015, marking the largest percentage gain for consecutive quarters since the first quarter of 2012 when proceeds increased 77% compared to the fourth quarter of 2011.

US investment grade corporate debt breaks first quarter record

Powered by a number of multi-billion dollar acquisition-related financings, high grade corporate debt offerings targeted to the US marketplace totaled US$352.1 billion during the first quarter of 2016, an increase of 1% compared to a year ago and the fifth consecutive first quarter to break a standing record for the asset class.

Global high yield volume down 65%

The volume of global high yield corporate debt reached US$43.6 billion during the first quarter of 2016, a 65% decrease compared to the first quarter of 2015 and the slowest quarter for global high yield issuance since the fourth quarter of 2011. First quarter issuance fell 10% compared to the fourth quarter of last year, marking the third consecutive decline for high yield corporate debt, by proceeds and number of issues.

Telecom offerings lead gainers; energy & healthcare fall more than 50%

Debt capital markets activity in the Telecommunications sector totaled US$34.1billion during the first quarter of 2016, registering an industry-leading increase of 32% compared to year-ago levels and an average deal size of nearly US$1.1 billion. Healthcare and Energy & Power activity saw the steepest year-over-year declines, registering decreases of 58% and 50%, respectively.

Emerging markets corporate debt down 45%

Corporate debt from emerging markets issuers totaled US$37.2 billion during the first quarter of 2016, a 45% decrease from a year ago. Corporate debt issuers from Mexico, India and Malaysia accounted for 56% of first quarter 2016 activity. Issuance from corporations in Russia totaled US$1.8 billion, a decline of 36% compared to a year ago, while offerings from Brazil increased 12% to US$1.2 billion.

JP Morgan tops global debt league table

JP Morgan held the top spot for global debt underwriting during the first quarter of 2016 with proceeds of US$114.2 billion and a decrease of 0.2 market share points. Barclays maintained second place with a market share decline of 0.3 points, while Citi maintained third place. Deutsche Bank fell to seventh place from fourth a year ago, registering a loss of 1.3 market share points.

Overall debt underwriting fees decline 24%

According to Thomson Reuters/Freeman Consulting, estimated fees from DCM activity totaled US$5.0 billion during the first quarter of 2016, a decrease of 24% year-on- year. Fees from high grade debt totaled US$3.0 billion (a 60% share), while fees from high yield debt totaled $433.8 million. High yield fees decreased 69% compared to a year ago, while investment grade fees decreased 3%.

Global Debt Equity Related (A1) Q1 2016

Source: Thomson Reuters

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