In the first half of 2004, as bond investors worried about rising interest rates and borrowers congratulated themselves on pre-funding at low absolute rates and spreads in 2003, global debt capital markets volumes fell 11% from first-half 2003 levels. Banks? revenues from the business fell by 10% to $8 billion from $8.9 billion, according to Dealogic.
And this might just be the start.
Of course, banks knew this wretched day would come. But they have hoped all along that revenue from reviving equity capital markets and M&A business would meet the shortfall when the debt bonanza ended.
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