Investment banking fees in western Europe are falling victim to the Greek debt crisis, as companies from London to Dusseldorf pull stock and bond offerings and put takeovers on hold.
Income from advising on mergers and selling shares and bonds in the region dropped 17 per cent from a year earlier to $5.9 billion in the first four months of 2010, the lowest in six years, according to estimates from New York-based research firm Freeman & Co. Fees in Europe are at about the same level as in 1999, the year the euro started, the data show.
“Companies have been held back from tapping primary markets because of the volatility and uncertainty driven by concerns over sovereign debt,” said Ivor Dunbar, London-based co-head of global capital markets at Deutsche Bank AG, the top-ranked adviser on corporate bond sales and mergers in Europe this year.
The decline in fees in Europe contrasts with a 53 per cent jump in revenue in the US and a 68 per cent increase in Asia, Freeman said. The sovereign debt crisis, which led to an unprecedented bailout package of almost $1 trillion, sapped confidence among European companies.