Investment bankers laugh their way to banks, garner highest ever fee of USD 1.1 bn in 2021 as IPOs see historic traction

Investment bankers collected over USD 1 billion in fees in the year 2021 riding high on historic traction in Initial Public Offering (IPO) led by the new-age companies. This makes it the highest-ever advisory fees collected, says an industry report, according to news agency PTI.  

Bettering the previous record of USD 10.8 billion in 2017, the year 2021 has seen a lifetime record initial public offers mopping USD 16.6 billion. 

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The report is prepared by Refinitiv, an LSEG (London Stock Exchange Group) Business, and one of the world's largest providers of financial markets data. 

While the number of IPOs more than doubled from a year ago to 63, the proceeds were more than four-times the amount raised from the same period previous year and the momentum is likely to continue as more IPOs are anticipated next year, with mother of all issues, LIC issue, expected to boost proceeds next year much higher, it said. 

Investment banking activities generated a record USD 1.1 billion in 2021, which is 8.5 per cent higher compared to 2020, making it the highest-ever annual period since records began in 2000, the report said. 

Of the total, equity capital markets underwriting fees touched USD 433.8 million, up 49.7 per cent over 2020 and the debt capital market underwriting fees totalled USD 164.8 million, down 24.4 per cent year-on-year, and this was the lowest since 2018. 

Overall the equity capital markets raised USD 35.6 billion in 2021, down 4.3 per cent in proceeds from 2020, despite a 73.6 per cent growth in volume as deals were done in smaller values. 

Follow-on offerings, which accounted for 52 per cent of overall ECM proceeds, raised USD 18.6 billion, again down 42.8 per cent, but in volume it was up 21.4 per cent. 

Equity capital market issuances by financial sector accounted for majority of the activity with 30.9 per cent market share worth USD11 billion, down 20.3 per cent year-on-year. 

Telecom saw a 46.5 per cent increase in proceeds and captured 17.4 per cent market share, followed by materials with 11.9 per cent market share. 

Among the I-bankers, SBI Caps took the overall top spot in investment banking fee league tables with 7.8 per cent wallet share and USD 86.9 million in related fee. 

(With PTI Inputs)