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Trust and Agency Services

Supporting issuers and investors at home

April 2020

As the coronavirus pandemic continues to impact corporate issuers, how can they minimise the impact on their depositary receipt programmes? flow illustrates how partnering with an experienced depositary bank, with a global footprint and strong track record, instils confidence and stability in a time of volatility

Ongoing volatility in the wake the Covid-19 pandemic continues to take its toll in the capital markets. In April alone, Bloomberg showed 23.38 billion of depositary receipts traded, up 63% on the previous month, and US$531.45bn of DRs traded, 38% more than March 2020.1

These volumes present a very persuasive case for even closer interaction between issuers and investors because with 1,474 sponsored programmes2, DRs provide a simplified and well-established way for international companies to access global markets. Hundreds of companies globally have issued American depositary receipts (ADRs) and global depositary receipts (GDRs) to carry out IPOs, to raise additional capital or simply broaden their investor base free from the requirements of a direct listing. ADRs are US dollar denominated negotiable instruments issued by a depositary bank such as Deutsche Bank3, while global depositary receipts will access two or more markets, usually the Europe and the US (similar to an ADR).


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International companies can list their shares via ADRs4 on a US exchange, for quotation through the US over-the-counter (OTC) market or list GDRs on a European exchange. These instruments offer them the opportunity to become dual listed in their home market as well as in the US. Trading in ADRs permits US investors to trade in non-US companies directly in the US equity markets, where ADRs are quoted in US dollars and traded during US trading hours.

Given their popularity among international investors, these programmes have usually relied on face-to-face investor meetings and roadshows. However, behavioural changes resulting from Covid-19 present a growing challenge to investor relations officers as these will impact on economic growth in the coming quarters and mean that their ADR programmes need to work more smartly. Putting the global economic impact of the pandemic into context during a webinar on 16 April, Deutsche Bank Securities Chief Economist Torsten Slok assessed how these changes, including lower dividend payouts and the halt of business travel globally were taking their toll on the corporate sector.


He stressed that the recession curve and impact on the global economy was very significant and foreshadowed a 33% decline in GDP by the US Federal Reserve in the second quarter. Tempering this outlook, however, he said that while the economy was not yet out of woods, the situation has not yet been as bad as it was during the global financial crisis of 2008/9.

While global stock markets had lost US$15trn in the past month, market conditions are beginning to normalise, he said5. “The impact on the economy is the duration of the shock [and] we expect a much faster rebound today than we had in 2009”.

This uncertainty in global financial markets has necessitated skilled co-ordination and resilience when managing DR programmes. This is demonstrated by Deutsche Bank’s consistently strong market position, having raised in aggregate US$5.8bn of DR capital through issuer IPOs in the 27 months from 2018 to March 2020. With a global presence and regional teams, Deutsche Bank’s DR team continues to support issuer clients, who are now working from home but who still need multiple local contact points they can deal with in their time zones.


Having introduced the DBVIC platform eight years ago, we were pioneering in the use of digitalisation to facilitate investor engagement.

Daniel Clark, Global Head of Depositary Receipts, Deutsche Bank

Daniel Clark

Demonstrating resilience

Leveraging a track record of providing DR programmes for more than 20 years6 Deutsche Bank has demonstrated the stability of the DR franchise to support corporate issuers’ DR programmes. Systems and processes have remained stable and fully operational. The teams are seamlessly administering 249 sponsored DR programmes and 798 unsponsored DR programmes from over 40 countries.

Having processed close to 1000 dividend payments in 2019 across its entire DR portfolio, these teams continue to execute high volumes of all types of corporate actions and conversions on behalf of issuers. They also provide support and guidance to investor relations teams on how to reach out to international investors.

This resilience demonstrates that even during these virtual times resulting from the pandemic, the franchise continues to successfully engage clients. This is evidenced by business wins from new and existing clients, who mandated Deutsche Bank to help them grow and develop their ADR programmes. These issuers include:

  • Travis Perkins, the UK building and construction group, which mandated Deutsche Bank as successor depositary bank for their sponsored Level I American Depositary Receipt programme completed in March 2020
  • AstraZeneca, the global, science-led biopharmaceutical company, which also mandated Deutsche Bank as successor depositary bank for its sponsored NYSE-listed American Depositary Receipt programme in February 2020
  • Lizhi, a leading audio content service provider from China, chose Deutsche Bank for its NASDAQ-listed American Depositary Receipt programme in January 2020

Business continuity, the well-being of their employees, the potential disruption of supply chains, weakened customer demand and potential revenue delays make up one set of challenges for corporate issuers; another lies in securing liquidity, adequate credit and investment to ensure the continuation of businesses. Given the current uncertainties around the duration and extent of the sharp economic slowdown, positive investor sentiment remains a priority.


Engaging investors

Maintaining this sentiment is even more crucial in a world where business travel is suspended and video conferencing replaces road shows and face to face investor meetings. To this end, Deutsche Bank Depositary Receipts has been working with investor relations teams and has provided alternatives for them to engage those investors. Issuers have found these options invaluable given that the global nature of DR ownership (see Figure 1) relies on investor outreach.

Figure 1: Depositary receipt ownership

Source: Factset

Among these new facilities, the Deutsche Bank Virtual Investor Conference (DBVIC) provides a free opportunity for both small and major investors to listen to experienced investor relations professionals and senior management who are responsible for communicating a company's equity story to the investment community. They can also ask a company representative questions in real-time and get valuable insights into a corporate and its industry in an efficient time frame. “Having introduced the DBVIC platform eight years ago, we were pioneering in the use of digitalisation to facilitate investor engagement,” notes Daniel Clark, Global Head of Depositary Receipts at Deutsche Bank. “And in today’s virtual world, with many parts of the globe in lockdown, that platform has now really come into its own, with participation well above average levels for the last DBVIC event and positive feedback received from issuer clients who presented.”

There has also been a response to China now leading the pack in DR capital raising, with US$17bn accrued from new IPOs or follow-on offerings in 20197. To cater for a growing Chinese client base, Deutsche Bank has begun hosting webinars conducted in Mandarin for Chinese companies to offer help and advice in communicating with their stakeholders during these unprecedented times.

In a challenging environment, issuers want to be able to still engage consistently with investors and to work with a depositary bank that can effectively promote the various alternative communication channels. The current discussions with issuers are now also extending to the legal, practical and governance considerations around hosting virtual AGMs.


Safety and soundness

Another factor in making this engagement work is the strength and stability of the depositary bank for issuers and counterparts alike. Here, Depositary Receipts is backed by a financial institution now marking 150 years in business and regulated in multiple jurisdictions.

Deutsche Bank Depositary Receipts continues to consistently hit notable milestones. Some key highlights include:

  • Number 1 in China and Hong Kong for all DR deals in 2019
  • Depositary Bank for the largest DR capital raising in EMEA: the US NASDAQ listing of Genmab from Denmark
  • Completion of the 19th virtual investor conference (“dbVIC”), a service Deutsche Bank has been offering to clients since 2012
  • Awarded Best ADR Bank, Best Local Depositary Receipts Bank for TraCRs, and Best DR Program in Asia for Pinduoduo at the Global Finance 2019 Best Depositary Receipts awards. Winner of 52% of all DR industry awards since 2011.
  • Placing IR education high on the agenda, Deutsche Bank continues to sponsor the UK IR Society’s Professional Development course for the 7th year running. At the same time, the Bank engages and supports the work of all the major IR associations around the world.




1 DR Monthly Snapshot, Deutsche Bank
2 DR Monthly Snapshot, Deutsche Bank
3 Video: What are Depositary Receipts?
4 ADRs are US dollar denominated negotiable instruments issued by a depositary bank, representing ownership of the underlying ordinary shares of a non-US issuer
5 Deutsche Bank Research, April 2020
6 Deutsche Bank entered the DR business in 1998 when it acquired the Bankers Trust business
7 Deutsche Bank Depositary Receipts



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