Investment banks see underwriting income rise despite epidemic

Coronavirus-dented IPO business seen recovering as economy reawakens

by Xu Jiangshan and Yuan Tianyi
Investment banks see underwriting income rise despite epidemic
CITIC Securities saw income hold up in first two months of the year. 

(ATF) – Wind data showed that in the first quarter of this year, investment banks received a total of 2.9bn yuan in equity underwriting income, up 65% from 1.7bn yuan in the same period last year.

The increase was mainly attributed to a substantial increase in starting income.

There are nine securities firms with equity underwriting income of more than 100m yuan, of which CICC and CITIC Construction Investment Securities each pull in more than 400m yuan. CITIC Securities, Everbright Securities, Guangfa Securities and Guojin Securities rake in more than 200m yuan.

IPO business affected by the coronavirus epidemic in the first two months, but since March 6, when the CSRC opened the "cloud issuance review", the flotation review has been progressing smoothly. 

On the whole, in the first quarter, the Development and Examination Committee (DEC) examined projects 55 times, and approved 50 (including scientific boards), with an approval rate of 90.91%. While that was almost the same as the corresponding period last year, the number of items discussed at meetings in 2020 was much higher.

The approving rate of projects by 27 securities firms discussed at DEC meetings was 100% in January and February. Everbright Securities has five projects, becoming the "biggest winner", Minsheng Securities has four and Guoxin Securities three.

In addition, the new refinancing rules are also seen as good for major industries, and refinancing has become a market for investment bankers to compete vigorously.