March 11, 2015

BNY Mellon’s 2014 DR Market Review Recaps a Strong Year

Depositary receipt capital raising more than triples in 2014 to highest level since financial crisis; annual report highlights key performance stats and regional data.

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. Online retailer Alibaba’s $25 billion initial public offering — the largest ever — led a wave of 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. 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. The value of DR ownership also increased by more than $53 billion (up 7%) to $876 billion.

“Investors continue to see DRs as a preferred option for portfolio diversification and cross-border investing, despite recent volatility in global stock markets,” said Christopher M. Kearns, CEO of BNY Mellon's Depositary Receipts business. “The dramatic jump in capital raised through DRs shows that companies from around the globe rely extensively on DRs to finance their growth and expansion.

“It’s been another pioneering year for DRs as well with the first American Depositary Receipt (ADR) by a Namibian company, and ground-breaking new rules in India, Taiwan and Romania that are helping open up these markets to increased foreign investment,” Kearns added. 

Watch Chris Kearns talk about the 2014 Market Review.

Companies from the EMEA region experienced the highest trading volume with 69.7 billion DRs traded valued at $1.4 trillion; followed by Latin American companies with 46.1 billion DRs traded at a value of $601 billion; and Asia Pacific companies, where investors traded 43.8 billion DRs valued at $1.3 trillion.