The Strategist

Foreign bank participation in China's IPOs fall to its lowest level since 2009

06/12/2023 - 05:18

Participation of foreign banks in Chinese initial public offerings has reached its lowest level in 14 years. They currently only make up 1.2% of the value of new products, down from more than 40% in 2009.

According to statistics from financial markets platform Dealogic, foreign banks' involvement in initial public offerings in mainland China has reached its lowest point in at least 14 years. Since the year's beginning, foreign banks have engaged in fewer new listings, totaling just $297 million (1.2% of the total), than in any entire year since Dealogic started compiling data in 2009. Then, by value, banks took part in 40.8% of all IPOs in China.

Dealogic claims that since 2019, Western banks have decreased their involvement in new listings in China. Their share was 19.3% at the time. In 2022, it was just 3.1%.

The 109 initial public offerings on the Shanghai and Shenzhen stock exchanges this year, which raised a combined $26 billion thanks to strong demand from Chinese investors, were not attended by any US banks. Only Credit Suisse and Deutsche Bank were involved as bookrunners this year.