A blockbuster year for investment banking

Global investment banking fees reached $159.4bn during 2021, a 22% year-on-year increase and the highest annual total since records began in 2000, according to Refinitiv Deals Intelligence. Performance was strong throughout the year, with fourth-quarter fees totalling $39.4bn, and the fees hovering around the $40bn mark for all four quarters.

The Americas contributed the largest proportion of this total, at 53% of fees and reaching $84.7bn, a 26% increase compared with 2020. Fees in Europe, the Middle East and Africa also increased, by 24% year-on-year, driven largely by activity in the UK and France. Asia-Pacific, including Japan, likewise saw a rise in fees, although this was less pronounced at 12% year-on-year.

JPMorgan maintained its leading league table position, with 8.1% of total investment banking fees wallet share. It was followed by Goldman Sachs and Morgan Stanley in second and third positions. US banks continued their dominance, collectively representing more than 30% of total fee take during 2021 and holding the five highest league table positions.

The strong performance was driven by a robust and record-breaking year across categories. Notably, merger and acquisition (M&A) advisory fees increased by 46% year-on-year to hit $48.2bn, the strongest year for M&A advisory fees since records began in 2000. Equity capital markets (ECM) fees reached a record $40bn and syndicated lending fees a record $26.7bn. Even in debt capital markets, which had seen a slight slowdown in deal activity compared with 2020, saw fees marginally increase to hit an all-time high of $44.5bn.

A stellar year for global ECM activity was comprised of more than 7200 individual offerings, worth a total $1.3tn, a record high by both the number and value of transactions done. These totals were supported by a bumper crop of more than 2000 initial public offerings (IPOs), worth $413bn, as well as 4600 secondary offerings, worth $691bn.

Separate figures from Refinitiv show that more than $162bn-worth of capital was also raised via special purpose acquisition company (SPAC) IPOs. Although 2021 started with a three-month period of runaway SPAC listing activity, a phenomenon which almost exclusively played out in the US markets, activity fell sharply in April 2021. It has since recovered but remains subdued compared with first-quarter levels. Nonetheless, the capital raised for these so-called blank cheque companies during 2020 and 2021 continues to be a meaningful driver of M&A activity.

Global syndicated lending volumes also reached a record total in 2021, hitting $5.4tn, a 49% year-on-year increase and the highest total since records began in 1980. Within this total, acquisition-related financing reached $928bn, a 70% year-on-year increase.