Canadian investment banking slumped a bit in 2011, with both debt and equity issuance down year over year, according to the latest data from Thomson Reuters
Overall debt issuance slipped 3.4% in 2011 to $159.6 billion from 410 deals (excluding self-funded transactions). Canadian corporate bond issuance was responsible for the overall decline, as it dropped to $52.0 billion from 151 issues, representing a 15.4% decrease in deal value from 2010. Total government debt issuance rose year over year to $104.3 billion from 251 issues in 2011, an increase of 6.3% compared to the same period last year.
Government issuance remains the largest sector of the market, accounting for 65% of all transaction value. Financials and energy & power were the next two most active sectors, with 20.0% and 5.0% of the market, respectively.
On the equity side, Canadian equity and equity-related issuance totaled $32.2 billion from 565 issues in 2011, which represents an 11.5% decrease in total proceeds from 2010, the firm reports. Common stock issuance was down about 6%, and the market for initial public offerings plunged 65% year over year to just $2.2 billion. Preferred share volume was up 12.8% from 2010, and retail structured product volume was down 2.7%.
TD Securities led the equity league tables for the year, ranking as the top overall bookrunner, with $5.4 billion from 53 deals (a 16.9% market share by proceeds). RBC Capital Markets and BMO Capital Markets rounded out the top three for 2011, with a 12.7% and 10.6% share of total market proceeds, respectively.
The 2011 results reflect a significant shakeup in the underwriting league tables. In 2010, TD ranked just fifth in overall equity underwriting, BMO was first, and GMP Capital ranked second. BMO has now slipped to third spot and GMP has dropped all the way to eighth. CIBC World Markets held onto fourth place, and Scotia Capital climbed back up to fifth spot in 2011 from eighth place in 2010.
Within the equity underwriting business, CIBC, RBC, and BMO took the top three spots in the Thomson Reuters’ rankings for retail structured product underwriting, with market shares of 32.7%, 29.2% and 9.7%, respectively. And, the preferred share market was led by RBC Capital Markets, who worked on deals worth $1.7 billion in 2011. Scotia Capital and TD Securities ranked second and third, with $1.5 billion and $1.1 billion, respectively.
Among debt underwriters, the league tables remained largely unchanged from last year, with RBC leading the way among overall debt underwriters, followed by TD and CIBC.