Global syndicated lending falls 25% from 2015
Global syndicated lending reached US$762.0 billion during the first quarter of 2016, a 25% decrease compared to the first quarter of 2015 and the slowest opening quarter for global lending since 2012. Just over 2,000 transactions closed during the first quarter of the year, a decrease of 27% compared to a year ago.
Acquisition financing drives first quarter lending
Acquisition financings accounted for seven of the top 10 syndicated loans closed during the first quarter of 2016, including Shire PLC's US$18.0 billion financing package to fund its US$33.7 billion acquisition of Baxalta Inc and a US$16.1 billion loan for Avago Technologies Finance related to its $36.5 billion acquisition of Broadcom. The US$10.5 billion loan to finance the combination of Newell Rubbermaid and Jarden rounded out the top three loans of the first quarter of 2016.
Americas lending accounts for 58% of activity
Americas loans accounted for 58% of global loan volume during the first quarter of 2016, as lending in the region declined 12% to same period last year. Within the Americas, loan volume in the United States totaled US$400.5 billion, down 34% compared to the same period last year and representing 53% of global volume. Europe accounted for 19% of global volumes as lending decreased by 42% compared to the first quarter of 2015. Asia Pacific fundraising saw a year-over-year decrease of 36%, while Japanese lending registered an uptick of 71% compared to 2015.
Energy & power, industrials & financials lead lending
Borrowing in the Energy & Power sector totaled US$114.0 billion during the first quarter of 2016, accounting for 15% of global loan activity, down 45% compared to lending in the sector during first quarter 2015. Technology lending saw the largest year-over-year percentage increases, up 46% compared to a year ago while Telecom lending declined 73% compared to 2015 levels. Energy & Power, Industrials and Financials together accounted for 42% of syndicated loan volume during the first quarter of 2016, compared to 49% a year ago.
Bank of America Merrill Lynch tops bookrunner rankings
Bank of America Merrill Lynch secured the top ranking for global bookrunners, by proceeds, with US$60.7 billion from 232 transactions during the first quarter of 2016, an increase of 1.6 market share points compared to the first quarter of 2015. JP Morgan maintained second place, with US$46.0 billion or 6.8% of overall loan proceeds during the first quarter of 2016, a loss of 0.5 market share points from a year ago.
Syndicated lending fees down 11%
According to Thomson Reuters/Freeman Consulting, bookrunning fees from global syndicated loans totaled US$2.7 billion during the first quarter of 2016, a decrease of 11% from last year. Fees from leveraged lending decreased 9% compared to a year ago and accounted for 60% of all lending fees during the first quarter of 2016.