Wall Street's Deals Rebound Is Missing Something
The recovery in investment banking activity would be much healthier if private equity firms weren't struggling to exit investments.
The IPO flow is looking better.
Photographer: Michael M. Santiago/Getty Images North AmericaDealmaking is back! At least that’s what it looks like after the big five US investment banks reported a 27% increase in first-quarter fees from mergers, takeovers and fund raising than the same period last year. Beneath the surface, the recovery is patchy and the bullish outlook of many Wall Street executives relies on private-equity firms getting back into the game.
Bank of America Corp. saw the strongest rebound with investment banking revenue up 35% versus the first quarter last year, it said on Tuesday. Morgan Stanley, which also reported Tuesday, had the weakest growth of the five, but its fees were still 16% better than last year. Citigroup Inc., Goldman Sachs Group Inc. and JPMorgan Chase & Co., which all reported earlier, also saw growth after nearly two years of depressed activity.