DEALTALK-Down to wire, UBS tops Asia ECM pile again

* UBS overcame a tough first half to regain top spot

* Wealth management, distribution key parts of UBS ECM

* Goldman won top spot for Asia, ex Japan, ex Australia

* Morgan Stanley top underwriter for Hong Kong IPOs

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By Michael Flaherty

HONG KONG, Dec 24 (BestGrowthStock) – After a brutal first half that had rivals
calling the end of UBS’s equity capital markets reign in Asia, the Swiss bank
staged a late-year revival to land it on top for the sixth year running.

For the investment banking business, equity capital markets deals account
for more than two-thirds of what a major foreign bank earns in Asia. The 2010
IPO boom pushed that percentage even higher, with some banks earning an
estimated $500 million in 2010 fees from Asia stock deals alone, according to
Thomson Reuters.

The top three Asia Pacific equity and equity-linked underwriters for 2010
were UBS AG , Goldman Sachs , and Morgan Stanley , in
that order, according to Thomson Reuters. The data excludes Japan.

Preliminary data as of Dec. 22 showed UBS on 107 deals worth $25.7 billion
in proceeds credit. Goldman’s tally was 77 deals worth $23.9 billion in
proceeds. League table credit is granted as a percentage of a deal, depending
on the amount of book runners involved

“The key to our success in the ECM business in the region rests on three
key areas. Our wealth management platform, our China JV and securities
license, and our distribution capabilities which are second to none,” said
Matthew Hanning, who is co-head of UBS’s Asia investment bank, excluding Japan.

While Hong Kong raked in a global high of more than $50 billion in IPO
proceeds this year, the city’s red hot stock market cooled down in the final
months, bringing share prices of most of this year’s listings down with it.

TOUGH START

By the middle of the year, UBS had — to borrow a phrase — a perfect
storm of set backs within its Asia ECM division.

Two of its top ECM executives in the region left for other banks, as did
its respected China rainmaker, Henry Cai. In addition, the bank was left off
or given minor status in two of the world’s largest stock offerings this year:
the $20 billion plus IPOs of Agricultural Bank of China ,
and AIA Group .

The bank was able to mop up other China bank mandates, but even just for
prestige stake, missing out on those deals hurt.

Those setbacks seemed certain to push UBS down the regional ECM rankings,
having earned top spot in the last five years, according to Thomson Reuters.
But a flurry of year end activity put UBS on top.

“It’s definitely been a challenging year in which we lost some key
people,” Hanning said. “But we quickly filled those roles to ensure there was
no disruption to our business.”

BIG DEALS

Goldman Sachs also had a stellar year in the ECM category, taking top
roles on AgBank and AIA.

Excluding Australasia, Central Asia and Japan, Goldman earned the most ECM
proceeds of any bank, with involvement in 62 deals worth $21.87 billion.

Dan Dees, Asia Head of Financing Group at Goldman, said that 2010 was an
extraordinary year, given the size of the offerings.

“I doubt we’ll ever see another year like it just in terms of sheer
magnitude of deals. I think we’ll see higher volumes, but to do a $22 billion
IPO, and then immediately a $20.5 billion IPO and have them trade up after
such strong support is unprecedented,” Dees said.

Morgan Stanley, which was the joint global coordinator for AIA and a top
handler of AgBank, was third in the APAC ECM list, ex Japan league tables, and
the top Hong Kong IPO underwriter, the data show.

CHINA JV, WEALTH MANAGEMENT KEY TO SUCCESS

Unlike other foreign banks in China, UBS has a full securities license
through its China joint venture, allowing the bank to underwrite and settle
A-share stock offerings. That’s given them an edge over competitors in China
that are bound by more restrictive securities licences.

The Asia stock syndicate team at UBS has built a steady business over the
years, a distribution channel that feeds off of what is key to its success in
Asia: UBS’s private wealth bank, Europe’s largest by assets.

With that base of customers hungry for Asia exposure, plus the region’s
booming growth of private wealth clients, UBS has a huge base of investors
lined up to scoop up stock offerings and IPOs underwritten by the bank.

That’s a good position for the bank to be in, given the run up in Asian
stock markets over the last several years.

(Editing by Lincoln Feast)

DEALTALK-Down to wire, UBS tops Asia ECM pile again