Depositary Receipt Market Review

Depositary Receipt Market Review

December 2014

Message from the CEO

Christopher Kearns

Dear Clients and Friends,

The strong performance of many markets in 2014, including a 12% gain for the S&P 500, a 19.8% gain on the Shanghai SE Composite, and a 31.3% return on the CNX Nifty conceals a volatile year.¹ Contributing factors such as investor anticipation of the end of the U.S. Federal Reserve’s quantitative easing, combined with macro-economic weakness and geopolitical instability, meant that many markets touched year-lows as recently as October.

Despite this imperfect backdrop, the Depositary Receipt (DR) market strengthened in 2014:

  • Issuers raised over $38 billion in 2014—three times more than in 2013, and a post-crisis record.² On-line retailer Alibaba’s $25 billion initial public offering—the largest ever—led a wave of the Chinese deals that accounted for one-third of the year’s capital raisings.
  • Robust demand prompted the creation of 166 DR programs for issuers from 37 countries.² Landmarks in DR expansion included the first American Depositary Receipt (ADR) by a Namibian company, and new DR rules in 2014 in India, Taiwan and Romania, which should help to open up these markets to further investment.
  • Secondary market activity was also vigorous. Trading volume grew 8% to 159 billion DRs, and DR trading value increased by 29% over 2013 with $3.3 trillion in DRs changing hands.2
  • The value of DR ownership increased by more than $53 billion (up 7%) for a total of $876 billion.3

Going into 2015, the outlook is positive, both in terms of demand and supply. BNY Mellon recently interviewed securities analysts and portfolio managers at major U.S. and European buy-side institutions, and overall, survey participants kept a positive outlook on investment in the equity markets for 2015.4

  • The majority expect to maintain their commitment to their current equity allocation overall this year.
  • More than two-thirds of participants viewed the Asia-Pacific, Latin America, and EEMEA markets positively in 2015.

BNY Mellon plays a leadership role in bringing together investors and issuers and by working with regulators to improve market efficiency and accessibility. We look forward to using our deep knowledge and proven expertise to help issuers and their investors achieve their DR goals in 2015.


Christopher Kearns | READ BIO
Chief Executive Officer, Depositary Receipts



2014 Depositary Receipt Highlights
Depositary Receipts are playing an increasingly important role in global financial markets, allowing companies and investors around the globe to connect seamlessly across borders.

  • 159 billion DRs valued at $3.3 trillion traded
  • $38 billion raised through 59 DR offerings
  • 77 new sponsored programs created
  • 89 new unsponsored programs created
  • 3,742 total DR programs in existence

Market Reform and the Evolving Depositary Receipt Landscape in India

BNY Mellon's Global Investor Relations Survey

Supporting Investor Demands for Depositary Receipts

Depositary Receipts Year-Over-Year
Source: BNY Mellon and other depositary websites.
For further information please visit our DR directory

New Sponsored DR Programs

Total Sponsored and Unsponsored DR Programs

Most Active Depositary Receipt Sectors
Source: Bloomberg and London Stock Exchange. Includes both sponsored and unsponsored DR programs.
Value = number of DRs traded multiplied by DR price at trade.
Volume = number of DRs traded during the period.

Top 10 in 2014 by value (billions)

Top 10 in 2014 by volume (billions of shares)

Depositary Receipt Liquidity

Sponsored and Unsponsored Market
Source : BNY Mellon and other depositary websites.
Bloomberg Sector Classifications.

Sponsored and Unsponsored Market

Insights Into North American Investors Views of Corporate Access

Institutional Depositary Receipt Ownership


Global Markets Outlook

Investor Outlook for 2015

BNY Mellon recently surveyed securities analysts and portfolio managers, of large buy-side institutions, for their outlook on global equity markets. Below are some of the key findings.

  1. A Bullish Outlook for 2015 A majority (64%) believe the investment appeal of the equity markets studied will either increase or stay the same over the course of the year.
  2. Signs that Appetite for Risk May Increase in 2015 A higher number say their tolerance for risk will be higher for 2015 than those assessing 2012-2014.
  3. Increased Enthusiasm for Equity Markets Of those expressing opinions on regions, 65% expected the investment appeal of Latin American markets to increase or stay the same in 2015, while only 35% rated them currently attractive or very attractive, and 79% said Asia-Pacific markets would increase in investment appeal or stay the same versus the 57% who viewed them as currently very attractive or attractive. Lastly, 68% had expectations that EEMEA markets would increase or maintain their investment appeal in 2015, while in 2014 only 17% considered EEMEA markets as very attractive or attractive.
  4. Stability of Current Equity Allocations and Approach to Fundamentals A majority say their commitment to equity investments will stay the same in 2015 despite general calls to broaden allocations. An even larger majority say the “noise” around generating short-term results has no impact on their focus on fundamentals or their overall investment approach.




1 Bloomberg, as of December 31, 2014.

2 BNY Mellon and other depositary websites.

3 IPREO, Year-on-Year, Q313 as compared to Q314.

4 Survey by Rivel, January 2015, described in more detail on page 20. For further information, please visit

BNY Mellon is a global investments company dedicated to helping its clients manage and service their financial assets throughout the investment lifecycle. Whether providing financial services for institutions, corporations or individual investors, BNY Mellon delivers informed investment management and investment services in 35 countries and more than 100 markets. As of Dec. 31, 2014, BNY Mellon had $28.5 trillion in assets under custody and/or administration, and $1.7 trillion in assets under management. BNY Mellon can act as a single point of contact for clients looking to create, trade, hold, manage, service, distribute or restructure investments. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Additional information is available on, or follow us on Twitter @BNYMellon.

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