Middle Eastern debt issuance up 53% in H1

Middle Eastern debt issuance increased 53 per cent year-on-year to $57.4bn in the first half of 2017, its best start to the year in decades, according to Thomson Reuters.

In its report, the company said the increase marked the best first half since 1980 and came thanks to Saudi Arabia’s $9bn bond issuance in April and Kuwait’s $8bn issuance in March.

The two countries accounted for 21 per cent and 18 per cent of the activity by value respectively.

However, Thomson Reuters said it did not reflect positively on Middle Eastern banking fees, which were down 15 per cent compared to the same period last year to $462.1m.

This was despite an 88 per cent increase in debt capital markets underwriting fees to $136.9m, with debt accounting for 30 per cent of the overall Middle Eastern investment banking fee pool – “the highest first half total in the region since our records began in 2000”, according to the firm.

MENA region managing director at Thomson Reuters, Nadim Najjar, said capital market fees increased by 36 per cent to $39.7m, with M&A transactions fees accounting for $98.0m – a 20 per cent decrease since last year and the lowest H1 total since 2012.

“Syndicated lending fees declined 41 per cent year-on-year to $187.6m, a three year low,” Najjar said

Completed M&A advisory fees accounted for 21 per cent and equity capital markets underwriting fees 9 per cent, he added.

HSBC earned the highest investment banking fees in the Middle East at $29.2 m, or 6.3 per cent share of the total.

The value of announced M&A transactions with any Middle Eastern involvement increased by 8 per cent to $20.1bn with energy and power deals accounting for 41 per cent of the total.

Despite this, the report highlighted that domestic and inter-Middle Eastern M&A declined by 46 per cent and outbound M&A activity declined by 13 per cent.