Banks could earn $332 million from wave of financial services deals

Mon Mar 6, 2017 12:12pm EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Pamela Barbaglia

LONDON (Reuters) - A spate of big deals by financial services companies in Europe could earn investment banks an estimated $332 million in advisory fees, with Goldman Sachs (GS.N: Quote) set to take the lion's share of the pot.

In the past two days, Standard Life (SL.L: Quote) revealed plans to buy Aberdeen Asset Management (ADN.L: Quote) and Deutsche Bank (DBKGn.DE: Quote) said it would raise 8 billion euros ($8.48 billion) from investors, potentially generating a big payday for investment banks working on those transactions.

Earlier, British bank Shawbrook Group (SHAW.L: Quote) said it had received a $1 billion bid from two private equity firms.

Goldman Sachs, which secured a major role in all three deals, has pocketed the highest fees from investment banking in the first two months of 2017 and pushing usual top dog JPMorgan (JPM.N: Quote) into third place.

The U.S. bank could earn between $18 and $24 million for advising Standard Life while an additional $13 to $18 million could come from its advisory work with Shawbrook, according to estimates from Freeman Consulting.

Aberdeen's corporate brokers, JPMorgan and Credit Suisse (CSGN.S: Quote), which advised the Scottish asset manager on its sale, could share proceeds of between $23 and 30 million.

But the biggest boost to investment banks' fees will come from Deutsche Bank's 8 billion euro share sale which could pay advisers up to 260 million euros, according to Freeman Consulting, based on underwriting fees of between 2 and 3.25 percent of the total raised.

Goldman Sachs is one of eight banks underwriting Deutsche's the rights issue alongside Credit Suisse, Barclays (BARC.L: Quote), BNP Paribas (BNPP.PA: Quote), Commerzbank (CBKG.DE: Quote), HSBC (HSBA.L: Quote), Morgan Stanley (MS.N: Quote) and UniCredit (CRDI.MI: Quote).   Continued...

A green traffic light is seen next to the logo of Germany's largest business bank, Deutsche Bank in Frankfurt, Germany, October 27, 2016.   REUTERS/Kai Pfaffenbach