Best Corporate and Investment Bank 2019
China Merchants Bank
China Merchants Bank is China’s premier joint stock commercial bank; its investment banking business has a team of more than 500 bankers in offices across the mainland, headed by general manager Han Gang from the Shenzhen headquarters.
CMB may not be comparable with the big four state-owned banks in terms of its debt and equity underwriting volume or lending power, but it is known for its growth momentum and its ability to innovate.
In debt financing, CMB’s underwriting volume grew twice as fast as the overall market over the first five months of the year compared with the same period in 2018. Ranking in the top spots among joint stock banks in terms of overall domestic bond underwriting, CMB’s presence in financial bonds puts its bigger state-owned peers to shame; it has executed the largest number of deals among all Chinese banks during our awards period (June 1, 2018 to May 31, 2019), and was second only to Industrial and Commercial Bank of China in terms of deal volume.
It was involved in many market opening trades during this period as lead or joint lead underwriter, having spotted perfect windows to launch innovative – and therefore less familiar – projects. These include the first bond by a central government-owned enterprise in support of privately owned enterprises (POE) for China Reform Holdings; the first credit risk mitigation warrant for POEs by a joint stock bank for O-film Tech; the first subordinated perpetual bond in China by Guangzhou Yuexiu; and the first bank capital perp for China Mingsheng Banking.
CMB also takes the innovative approach into the more structured products it was involved in, working as a joint lead underwriter alongside lead underwriter Industrial Bank on the first so-called ‘three green’ – in other words by a green company, backed by green underlying assets and to fund green projects – asset-backed notes in China, as well as other ABNs and commercial mortgage-backed notes (CMBNs) for the likes of China Construction Second Engineering Bureau, Everbright Jiabao and Guangdong GDH Water.
The bank is also a tier-one player in leverage finance, competing against the big four and was picked as our winner for the category. It ranks among the best either by overall value of the M&A deals it was involved in or the leveraged lending volume, having grown at high speed over the last few years.
With a focus on mixed-ownership SOE reform, the privatization of A-share and H-share listed companies as well as domestic asset purchase and outbound Chinese acquisitions, CMB wins praise from not only its clients but also its competitors for its professionalism and its new – and sometimes daring – approach.
It is also one of the few Chinese banks working on the non-lending side of M&A transactions, cooperating closely with the financial advisers (the securities houses) and involving itself in the negotiation, design and structuring process of the deals.
Although a part of the business that only started to take off two or three years ago, CMB has acquired talent from the securities houses with the goal of building its investment banking business.