JPMorgan and Goldman retain top two spots in Global Investment Banking Rankings (NYSE:JPM)

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Chris Hondros

Investment banks have faced headwinds in 2022 as rising interest rates make mergers and acquisitions more expensive and raising capital in debt markets less attractive. And market volatility has caused some companies to delay IPOs and other actions offerings.

Through September 14, the 10 largest investment banks generated $56.4 billion in revenue this year, down nearly 39% from $92 billion in the same period a year ago. year, according to Dealogic.

Earlier this month, JPMorgan Chase (NYSE:JPM) President and COO Daniel Pinto told an industry conference that he expects the company’s investment banking fees in the third quarter to drop 45% to 50% compared to a year ago. And while fees are down, the bank is not quick to cut jobs to match the activity. “You have to be very careful when you have a bit of a downturn to start cutting bankers here and there because you’re hurting the possibility of growth going forward,” Pinto said.

On the other hand, the New York Times reported that Goldman Sachs (NYSE: GS) was preparing earlier this month to begin a new round of job cuts as the bank faces a slowdown in business activity.

While the size of the pie has shrunk this year, most banks have been able to maintain their ranking in the global rankings. For 2022 YTD, JPMorgan Chase (JPM) and Goldman Sachs (GS) both retained their first and second spots as global investment banking revenue generators, while Bank of America Securities (NYSE: BAC) moved up a level to third place, pushing Morgan Stanley (NYSE: MS) in fourth place, according to 2022 numbers compiled by Dealogic through September 14.

Citigroup (NYSE:C) remains in fifth place. Wells Fargo (WFC) Securities landed in 10th place in global investment banking, improving two spots from a year earlier.

JPMorgan (JPM) ranked first in debt capital markets revenue, equity capital markets revenue and U.S.-traded loan revenue, all unchanged from the prior year period. Source: Dealogic

In global M&A revenue, the ranking of the top six banks is that of the previous year. Goldman Sachs (GS) retained its leading position, followed by JPMorgan (JPM), Morgan Stanley (MS), BofA Securities (BAC), Citi (C) and Jefferies LLC (JEF). Lazard (LAZ) made the biggest gain in the top 10, taking seventh from 11th a year earlier and dropping Barclays (BCS) to eighth. Rothschild and Evercore (EVR) came in at No. 9 and No. 10 respectively.

For the biggest shifts in global rankings, Chinese banks made significant progress in global equity markets, with Citic Securities taking second place (after being 10th in 2021 year-to-date), China International Capital Corp. was in fourth place (vs. 13th a year earlier), and China Securities Co. Ltd fell to seventh place from 26th place a year ago. In addition, Haitong Securities Co. rose to 9th place, up 10 places from a year earlier, and Huatai Securities ranked 10th, up from 23 places last year.

Last week, UBS analyst Brennan Hawken downgraded investment banks Evercore (EVR) and Moelis (MC) due to rising compensation ratios and falling M&A activity.

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