(Ecofin Agency) - Since January 2020, the international investment banks posted a total of $84.8 billion in revenues, up 14% compared with that of 2019. They achieved this figure despite the coronavirus pandemic, which is affecting global activities in virtually all sectors.
Data published by Dealogic and the Wall Street Journal showed a sharp improvement in banking activity this year. Over the same period last year, revenues of investment banks stood at $77.3 billion, down 3% from that of 2018.
These data once again confirm the hypothesis that, in times of crisis as in times of expansion, banks are the big winners from the changes affecting the world. While Covid-19 weighed on interest income due to large provisions for credit risks or write-downs, the investment side grew.
For example, Ecofin Agency noted that international investment banks benefited from a nearly stable volume of transactions in the equity market, enabling companies to raise $725.4 billion, either through new IPOs or through additional offerings of securities on the financial markets. In this segment, the financial markets in Asia (Japan excluded) led the way in terms of performance, with a total of $228.5 billion in transactions already completed.
But the investment segment that generated the most activity was the bond markets. Canada was the most dynamic with a 39% increase in bond borrowing. The United States was the largest fundraiser with nearly $4091.3 billion raised through bond issues, representing 48% of bond issues to date worldwide.
In terms of revenues, the international debt market generated a total of $28.3 billion for investment banks, while the equity issuance segment raised $26.03 billion. Africa, combined with the Middle East, does not contribute to this boom in investment banking revenues.
The sector's activities there generated $1.2 billion, down 10%. Over the same period in 2019, investment banks had generated $1.4 billion in revenues, up 33% compared to those of 2018.