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Citi's Jim Cowles, head of EMEA |
It would be natural to assume that the collapse of investment banking volumes in any global region would be bad news for the leading players in that market.
So it is slightly surprising to find the man in charge of Citi’s central and eastern European (CEE) operations in buoyant, not to say bullish, mood.
“We are pleased with these franchises,” says Jim Cowles, head of EMEA. “Despite a difficult environment over the last couple of years, they are profitable and their operating efficiency levels are above our corporate benchmark.”
It is hard to overstate just how difficult the environment has been. A combination of Russian sanctions, rising geopolitical risk and weak growth and liquidity has set investment banking in emerging Europe back by more than a decade.
Since 2013, M&A activity has halved, while debt capital markets volumes are down by two-thirds. Equity markets have been even worse affected, with primary supply over the past two years amounting to barely a quarter of levels seen in the early years of the decade.
This might be expected to bear particularly hard on Citi, which dominated DCM and ECM league tables for CEE before the Russia crisis – as indeed it does today – and has a healthy M&A franchise in the region.
