CHINESE investment banks have leaped ahead of their Wall Street peers in global rankings for initial public offerings (IPOs), as China wraps up a record year for listings which bucked one of the worst slowdowns in deals history.

CITIC Securities Co. pushed ahead of Goldman Sachs Group Inc. as the top underwriter of IPOs this year, followed by China International Capital Corp. and China Securities Co., Bloomberg league tables show.

It’s the first time the top three spots are held by Chinese investment banks since at least 1999. Six out of the world’s top 10 IPO banks are Chinese, commanding a 28% market share.

Chinese brokerages have muscled into the IPO market historically dominated by global banks, particularly in places like Hong Kong.

A push by Chinese authorities in recent years to encourage more listings on domestic exchanges will offer local lenders a larger IPO market to tap in China.

At the same time, rising tensions with the United States have caused a near-total collapse in New York IPOs by Chinese companies — a big business for Wall Street — and pushed them to list on mainland exchanges or in Hong Kong instead.

“The trend of some firms opting for a Hong Kong listing next year may continue, and that share of the market might be filled by Chinese banks, rather than foreign banks which have an edge in overseas listings,” said Wang Yugang, fund manager at Beijing Axe Asset Management Co.

While listings worldwide have suffered their steepest year-on-year slump since 2008 on the back of rampant inflation and interest rate hikes, the Chinese IPO market has had a record year with US$93.8 billion raised so far.

That’s 45% of the global IPO haul of nearly US$208 billion, data compiled by Bloomberg show. The United States, usually the world’s biggest IPO market, contributed just US$24 billion.

CITIC Securities worked on 82 listings this year, more than those of Goldman and Citigroup Inc. combined. They include the US$5 billion Shanghai share sale by China’s largest offshore driller CNOOC Ltd.

While China’s domestic IPO market is expected to remain strong, with about 376 companies in the pipeline, a resurgence in U.S. listings could see mainland lenders lose their top spots eventually. (SD-Agencies)