Fees are falling, oil prices are low and the region’s economies are under threat. But top global investment banks say they have no intention of pulling back from the Gulf.
Regional fees from M&A, loans, debt and equity issuance fell 7 per cent in the 10 months to the end of October, Refinitiv data show. Globally, meanwhile, fees rose 17 per cent in the same period as companies in the US and Europe raised cash to deal with the impact of the pandemic.
Comparisons with the rest of the world are likely to be worse for the full year, because last December’s Saudi Aramco IPO — the world’s highest-value listing — drove a one-off fees bonanza for the Gulf in the final months of 2019.
The outlook for 2021 is less clear, as the pandemic spurs activity in certain areas, such as cash raises for relatively healthy companies and restructuring of balance sheets for struggling ones, while stifling other activities, such as fundraising as investors fret that economies could worsen so much they will not get their money back.
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