A reminder of the top banks in M&A, ECM and DCM in the Middle East

16 March 2012

2 minute read

A reminder of the top banks in M&A, ECM and DCM in the Middle East

As well as outlining the top players globally in each business area, JPMorgan's massive report on the state of investment banking has some special information on the state of M&A, ECM and DCM in the MENA region.

Conclusion number one: there is still big growth potential (and may therefore be hiring).

Conclusion number two: US and European banks have got the MENA market sewn up. Local banks typically have a market share of less than 2%.

Why MENA capital markets businesses have the potential to grow:

Long term, there's big potential for Middle East-based businesses to float on equity markets, say JPMorgan's analysts.

"Nearly three quarters of businesses in the region remain family or government-owned and hence reliant only on captive funding or direct/indirect government backing," they write, pointing out all the Arabic mega-corporates which remain unlisted (Qatar Petroleum, Rasgas, National Commercial Bank, Saudi Aramco, Emirates Airlines, Etihad & Qatar Airways, Jumeirah Hotels, larger Egyptian banks such as National Bank of Egypt and Bank Misr).

"Capital markets can potentially provide a more efficient and cost-effective way of raising capital /financing," add the analysts, claiming that MENA-based corporates have started to realise this and are keener than they used to be on raising foreign capital. However, this foreign capital can only be sourced by foreign banks - with the result that they dominate the league tables shown below.

Will this be the year that M&A comes back?

2012 could also be a bigger year for M&A in the MENA region, says JPMorgan. They speculate that international investors will return to MENA as the political situation calms down (although in the light of what's happening in Syria and the potential problems with Iran, this may prove wishful thinking).