Depositary Receipt Capital Raising Activity Rebounds in 2017
February 01 2018 - 10:35AM
Business Wire
Depositary Receipt (DR) capital raising activity in 2017
rebounded significantly from 2016 as more non-U.S. companies sought
to raise funds from U.S. investors in DR form, according to Citi’s
Depositary Receipt Services Year-End 2017 Report.
Foreign issuers raised $15.6 billion in DR form in 2017, up 126%
from the previous year. Companies from China led the activity,
accounting for 26% of the total, according to Citi’s report. By
sector, companies in the pharmaceutical and biotechnology,
financial and energy industries issued 38% of the capital raised in
DR form.
In addition, 24 issuers leveraged the JOBS Act to conduct DR
initial public offerings (IPOs), accounting for 75% of all DR IPOs.
Enacted in 2012 to help small and emerging companies raise capital
in the United States, the JOBS Act modified regulatory requirements
for a new category of issuer, known as an Emerging Growth Company,
which generates less than $1 billion in gross annual revenue.
“The significant rise in DR capital raising activity
demonstrates that DRs are an attractive vehicle for both issuers
and investors,” said Nancy Lissemore, Global Head of Depositary
Receipt Services at Citi. “Moreover, Citi’s DR programs helped
raise 43% of the total DR capital issued in 2017 and more than 50%
of DR IPOs, clearly showing that Citi is a leading depositary bank.
At Citi, we strive to provide the highest level of depositary
receipt services to our clients and their investors.”
The Asset magazine honored Citi as the “Best DR Bank” in Asia in
the 2017 Triple A Asset Servicing, Fund Management and Investors
Awards.
Other notable DR market highlights in 2017 include:
- The value of DRs held by institutional
investors totaled $1.1 trillion as of the third quarter of 2017,
the first time reaching such levels.
- Total DR trading values increased 16%
from 2016, while trading volumes decreased 9% from the same
period.
- The pool of unsponsored American
Depositary Receipt programs grew to 1,644 in 2017, with programs
from Japan, China and France accounting for 56% of the total
unsponsored trading volume during the year.
Citi is a leading provider of depositary receipt services. With
depositary receipt programs in 61 markets, spanning equity and
fixed-income products, Citi leverages its global network to provide
cross-border capital market access to issuers, intermediaries and
investors.
For more details on the 2017 DR market, please refer to Citi’s
Depositary Receipt Services Year-End 2017 Report. For more
information about Citi’s Depositary Receipt business, please refer
to the Citi DR website: www.citi.com/dr.
Citi
Citi, the leading global bank, has approximately 200 million
customer accounts and does business in more than 160 countries and
jurisdictions. Citi provides consumers, corporations, governments
and institutions with a broad range of financial products and
services, including consumer banking and credit, corporate and
investment banking, securities brokerage, transaction services, and
wealth management.
Additional information may be found at www.citigroup.com |
Twitter: @Citi | YouTube: www.youtube.com/citi | Blog:
http://blog.citigroup.com | Facebook: www.facebook.com/citi |
LinkedIn: www.linkedin.com/company/citi
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CitiRobert Julavits, 212-816-8020robert.w.julavits@citi.com
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