DR Market Remains Robust

January 15, 2010 (PLANSPONSOR.com) – Global equity markets may have experienced significant volatility during 2009, but the depositary receipt (DR) market has remained healthy, according to data from BNY Mellon.

A news release said the BNY Mellon ADR Index finished 2009 36% higher, as total DR trading volume reached record levels with a 2% hike over 2008 despite declining equity values.  

Highlights of the latest BNY Mellon ADR report included :

  • 34 of the 35 BNY Mellon ADR country indexes posted higher returns in 2009, with the Argentina, Brazil, and India indexes each posting returns above 100%. 
  • The world’s largest DR issue as measured by value was Brazil’s Petrobras, with nearly $58 billion worth of DRs outstanding. 
  • By year-end 2009, investors were able to select from a record 3,127 sponsored and unsponsored DR programs for companies from 74 countries. 
  • Issuers from emerging markets continued to dominate many DR market metrics, accounting for 69% of capital raisings, 55% of trading value and trading volume,and 50% of new sponsored programs.   
  • DR capital raisings totaled $32 billion, a 122% increase from 2008’s $14.4 billion, led by issuers from China, India, and Taiwan. The largest DR capital-raising transaction in 2009 was ING Group, which raised $11 billion.  

“Investors are using DRs to access global equities as they seek new investment opportunities,” said Michael Cole-Fontayn, chief executive officer of BNY Mellon’s Depositary Receipts business, in the news release.  “In 2010, we see great opportunities from emerging markets, as evidenced by the continued shift in the flow of funds from developed to emerging markets, especially the BRIC (Brazil, Russia, India and China) countries.”  

The major U.S. stock exchanges remained the largest trading markets, accounting for 84% of total DR trading value in 2009.  Nearly 114 billion DRs traded on U.S. exchanges, valued at $2.5 trillion during 2009.  European-listed DR trading volume increased 17% on $214 billion in value on the International Order Book (IOB), the primary trading platform for DRs listed on both the Luxembourg Stock Exchange (LuxSE) and the London Stock Exchange (LSE).

More information is available at  www.bnymellon.com/dr.