Fee pools are up but Asia's debt markets look overbanked

Asia's bond markets have started 2013 on a strong note, but there are signs that investors are starting to rotate out of bonds into stocks.
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BOC International is one of the new entrants seeking to play a part in the pickup of debt issuance in Asia (AFP) </div>
<div style="text-align: left;"> BOC International is one of the new entrants seeking to play a part in the pickup of debt issuance in Asia (AFP) </div>

Last year was a watershed year for Asia’s debt markets. For the first time in history, debt accounted for about 40% of investment banking revenues, according to Dealogic. The unprecedented earnings were driven by record volumes, as the total dollar bond issuance from Asia ex-Japan surged to $130 billion.

But competition is also rife. In previous years, the fee pool was spread among a smaller handful of players. These days, every man and his dog wants a piece of the action. Aside from the bulge bracket banks, there are new entrants like ANZ, Mizuho, Mitsubishi UFJ and Bank of China International, which are all vying for business.

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