The total value of capital markets issuance from U.S. banks declined sharply month over month in August, despite monthly increases in both common equity and preferred equity offerings.

The total raised by U.S. banks decreased during the month to approximately $4.65 billion, a 64.1% decrease from July and an approximately 27.9% decrease year over year, according to S&P Global Market Intelligence data. The reduction was driven by senior debt, which fell by 71.8% month over month.

Senior debt continues to lead

Despite the sizable decrease in senior debt offerings month over month to $3.2 billion, for the past 13 months, senior debt has been the highest capital offering type. Senior debt was also the only type of offering to exceed $1 billion in August. Nevertheless, August represented the least amount of senior debt raised in any month in 2022.

Senior debt was followed by preferred equity at $715.0 million, which represented a 2,283.3% increase month over month from the $30.0 million raised in July. Common equity generated the third-highest total value in August at $498.9 million and was the only other type of issuance to see a monthly increase.

With an 82.8% decline month over month to $240.0 million, subordinated debt saw the largest monthly decline and lowest total value in August. The month of August also featured the second-lowest amount of subordinated debt raised in any month in 2022 behind April.

The combined $4.65 billion in capital raised by U.S. banks in August was the lowest monthly total in 2022.

Largest issuers among US public banks

State Street Corp. and Huntington Bancshares Inc. were the largest U.S. public bank issuers in August as both companies completed $750.0 million senior debt offerings, respectively, on Aug. 1. In total, six companies completed senior debt offerings and all six offerings were $350.0 million or greater.

M&T Bank Corp. and JPMorgan Chase & Co. each completed $500.0 million senior debt offerings while Synovus Financial Corp. and F.N.B. Corp. both completed $350.0 million senior debt offerings.

The only other companies to exceed $100.0 million in offerings during August were First Republic Bank, KeyCorp and Midland States Bancorp Inc.

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First Republic Bank completed the largest disclosed common equity offering, $353.3 million, on Aug. 2. KeyCorp and Midland States Bancorp completed the two disclosed preferred equity offerings. KeyCorp completed a $600.0 million offering, which was the second-largest capital offering of the month, while Midland States Bancorp completed a $115.0 million preferred equity offering.

Three companies combined for the four subordinated debt offerings totaling $240.0 million. QCR Holdings Inc. led the way with two separate offerings totaling $100 million. Five Star Bancorp completed a $75.0 million offering while Flushing Financial Corp. completed a $65.0 million offering.