China is not excluded from the global M&A boom, and if you’re wondering which investment banks are securing the most business, the answer remains the same – the local players.
Figures from Dealogic show that Asia Pacific (ex Japan) targeted M&A volume reached $770.9bn in the first nine months of 2015, and China comprises 50% at $384.3bn, up 48% year-on-year.
Technology has become the top targeted industry in the same period of time, with $97.7bn worth of deals. It’s also seen the most senior moves. Winston Cheng, the previous head of Asia technology, media and telecommunications (TMT) at Bank of America Merrill Lynch left the bank in August to take up the role of senior vice president and head of corporate finance and development at China’s online video giant LeTV. A few days later, China’s e-commerce giant Alibaba appointed former senior Goldman Sachs banker Michael Evans as president, charging him the task of overseeing Alibaba’s global expansion.
Chinese banks have taken up eight positions in the top ten ranking of investment banking revenues earned. This time last year, there were only three Chinese banks in the top ten. Global banks are being pushed out of business in China.
This is not only happening in China. It’s across East Asia now. The table below shows that global banks are facing serious challenges from Chinese banks in the Asia Pacific (ex Japan) region too. For the first nine months of 2014, there were eight global banks in the top ten ranking of Asia (ex Japan) (in fact, the first eight). Now only five left.