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Investment banking fees rise 13 percent as deal volumes surge

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[October 02, 2014]  LONDON (Reuters) - Increased deal activity in the first nine months of the year has netted investment banking advisers $68.8 billion in fees, 13 percent more than they earned a year earlier, new data showed on Thursday.

It was the best start to the year for investment banking fees since 2007, according to data for the year to Oct. 1, compiled by Thomson Reuters and Freeman Consulting.

Greater levels of confidence and the availability of cheap financing have encouraged companies to pull the trigger on mergers and acquisitions, lifting volumes by more 60 percent to $2.7 trillion, while strong investor demand has driven up equity capital market (ECM) deals by a quarter to $678.1 billion, separate data showed this week.

The end of the third quarter featured Chinese e-commerce company Alibaba's $25 billion initial public offering (IPO), for which bankers earned fees of $300 million.

The deal, the world's largest ever listing, helped to lift fees in the Asia Pacific region by 23 percent in the first nine months. Elsewhere, fees rose by almost a third in Europe, while in the Americas fees were 7 percent higher. Only Japan recorded a decline, with fees down 11 percent.

Wall Street bank JPMorgan, a joint bookrunner on the Alibaba IPO, topped the league table for fees, having earned $5 billion by the end of the third quarter and making up 7.6 percent of the total fee pool.

The top 10 was largely unchanged from a year earlier, with Bank of America Merrill Lynch and Goldman Sachs maintaining second and third places respectively.

Only RBC Capital Markets made an improvement, jumping one place to replace UBS in tenth position.

(Reporting by Clare Hutchison; Editing by David Goodman)

[ 2014 Thomson Reuters. All rights reserved.]

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