Global markets have seen a dramatic increase in initial public offerings by emerging-market companies this year, with $53.7bn raised so far in such deals.

Already representing half of the volume raised for all of 2006, the funds raised are the highest level on record for the first five months of the year, according to data from Dealogic.

The spree of new issues in the developing world has been fuelled by the ample liquidity in the financial system, a strong appetite for risk among investors and growing demand for new equity from fast-growing companies.

In the last two weeks alone, investors have backed the $8bn IPO in London and Moscow by Russia's second largest bank, VTB; the $1.85bn offering by Halkbank, Turkey's state lender; and the $1.4bn flotation of Russia's AFI Development, a real estate company. All three issues were priced in just nine days.

"There has been a significant amount of M&A (mergers and acquisitions) and buy-out activity across emerging markets which has returned a lot of cash into the market," said Alasdair Warren, a managing director at Goldman Sachs who worked on all three new issues.

A sustained bullish sentiment in equity markets around the globe has also helped. In February, rising defaults in the US subprime mortgage sector and a decline in the value of mainland Chinese shares helped trigger a capital flight from global equity markets. However, the markets have recovered since then.

So far this year, investors have absorbed 268 emerging market IPOs, including those completed in mainland China and the Middle East, which in total raised $53.8bn. That compares with this time last year when 184 IPOs had raised $25.6bn.

UBS currently ranks as the top bookrunner for emerging market IPOs with 27 deals worth a total $6.1bn. Goldman Sachs is in second position with eight deals worth $4.4bn and Citi comes in third with 11 deals valued at $4bn.

Luis Vaz-Pinto, head of European syndicate at JPMorgan, said: "There is a massive need for capital from emerging market companies that goes beyond what can be offered by bank loans. It makes sense for them to finance themselves through the equity capital markets."

"Also, the biggest source of IPOs is likely to come from emerging economies. Most of the biggest companies from developed Europe, for example, are already public and the privatisation wave there is mostly over."

In addition, emerging market companies are increasingly attracting a wider pool of investors who are increasingly looking further afield for investments that may offer higher returns. "The participation of funds in these IPOs has gone beyond emerging markets specialists to include both European and global funds," Mr Warren said.

For instance, around half of the shares sold by VTB came from was from non-traditional emerging markets investors. The issue was subscribed seven times, according to people close to the situation.

The boom in emerging market IPOs has pushed up the salaries for those bankers arranging corporate mergers and stock and bond sales. According to a recent survey by Napier Scott, the executive search firm, bankers in Moscow, for example, can earn between $2m and $3m.