India takes over China in M&A dealmaking fees for the first time

The world’s largest banks this year will earn more dealmaking fees in India than in China. The development has been described as a historic reorientation by financers as they diversify from a decoupling Chinese economy. So far, foreign banks have been able to pull $231 million in mergers and acquisition (M&A) fees in India, beating China’s $204 million earned over the same period. According to a report by Financial Times, JP Morgan will earn more M&A in India and China this year for the very first time. COVID-induced lockdowns in China led to a fall in revenue from Chinese equity and bond markets, which were once considered one of the biggest sources of fees for the European and US finance houses settled in Asia. However, China’s deal activity is expected to grow now as it reopens gradually. The country’s stringent zero-COVID policy, according to some Wall Street bankers, led Chinese companies to turn to domestic banks for advisory-related work. Data from Dealogic shows that foreign investment banks’ core revenue from equity and debt capital markets as well as M&A has dropped by 70 per cent as compared to last year. The Head of banking and capital markets for Citi in Asia said, “The evolution of the banking wallet there with the growth in tech, alongside the established Indian corporate titans being more active has made India a leading investment banking market for Citi in 2022.” “We expect that to continue in the years ahead with the pipeline [in India], one of the largest we have,” he added. A Singapore-based Asian investment banking head of one US bank described the rise by saying, “It is a fundamental and I think permanent repositioning by Wall Street. If you believe Xi Jinping is intent on building his own sphere of economic influence, while the US shows no sign of stopping its crackdown on China, where else do you go in the region?” India saw an M&A surge of 58 per cent year on year to an all-time high of $148 billion in the first nine months of 2022, according to data given by Refinitiv. With inputs from agencies Read all the  Latest News ,  Trending News ,  Cricket News ,  Bollywood News , India News  and  Entertainment News  here. Follow us on  Facebook,  Twitter and  Instagram.