Global banks in Hong Kong are feeding on scraps.
Fewer initial public offerings in the city mean institutions including UBS (UBSG.S), Bank of America (BAC.N) and Morgan Stanley (MS.N) are tackling smaller transactions. Three companies have sounded the gong to ring in new listings this week, but it’s nearly a year since a debut raised over $1 billion.
As big deals including chip designer Arm and food delivery company Instacart (CART.O) cross the finish line in New York, albeit with mixed results, it will get harder for firms in the Asian hub to stomach slim pickings.
Bankers in Hong Kong are working on smaller issuances than they typically took on in the past, Dealogic data shows. UBS and Bank of America, for instance, are supporting Tuhu (9690.HK), which debuted on Tuesday after pricing at the bottom of the range last week with an offering of $152 million.
In the years 2018 to 2020, the average deal value for the Swiss bank in the Asian hub was around 10 times that figure; for its U.S. peer, the ratio was even higher. The trends are more mixed in the United States.