Theme: Revenue and (lack of) volatility
Revenue and (lack of) volatility The current lack of volatility is not exceptional; in equities, FX, and rates it has merely returned to pre-‘Crunch’ levels. The link between banks’ revenue and volatility has been overstated. Equally important factors – to name a few – are banks’ risk management, regulatory initiatives, and investors’ inertia. We reiterate […]
Sector: Capital Markets: Results Review 1Q14
Capital Markets: Results Review 1Q14 The top 13 investment banks recorded $54bn revenue in 1Q14: only 6% below 1Q13, and better than expected by most observers. FICC declined by 16% during this period – largely due to persistent weakness in Rates and FX – but this was offset by strong primary issuance and equities revenue. […]
Sector: Capital Markets Regions: FY13
Capital Markets: Regions FY13 This publication is supplementary to our quarterly Results Review: it ranks top capital markets revenue generators in each region and product area. All data is reconciled against the published financial statements. Further detail is available on request.
Sector: Canadian Commercial Banking: regional variations
Canadian Commercial Banking: regional variations Canada’s commercial banking market remains dominated by local champions… … but there are significant regional differences in client productivity and industry-specific revenue opportunities. Banks seeking to grow their franchise or enter the market need province- and sector-specific strategies.
Sector: Capital Markets: Results Review 4Q13 / FY13
Capital Markets: Results Review 4Q13 / FY13 Compared to prior-year periods, the Top 13 banks’ capital markets revenue was flat in 4Q13 and only slightly ahead for the whole of 2013. FICC proved more resilient that many commentators expected, with cumulative decline being mostly offset by stronger primary, equities, as well as prop and principal […]
Theme: ‘Rescuing’ banks from HF & PE investments
‘Rescuing’ banks from Hedge Fund & Private Equity investments Our analysis shows that Top 14 US and European banks generated $35.5bn in net revenue from their HF and PE investments in 5 years to end-2011… … and that revenue is likely to all but disappear as a result of the ‘Volcker Rule’ and similar legislation being […]
Theme: Proprietary Traders – then and now
Proprietary traders – then and now The Volcker Rule’s ban on proprietary trading ignores the fact that no bank required a bailout due to proprietary losses; on the contrary, our analysis shows that prop desks of Top 13 banks made a strong positive contribution to banks’ revenue during FY07-FY10. In this note, we look at ex-prop […]
Sector: Profit Masters
Profit masters This note provides a brief, high-level snapshot of how pre-tax profits of Top 13 investment banks evolved vis-à-vis peers since the original ‘Crunch’. Product- and/or regional-level detail is available on request. Highlights: The two banks that most improved their share of the peer group profit pool are J.P.Morgan and UBS. Uniquely among its peers, […]
Theme: Profit Drivers
Profit drivers Cost management, while important, is at best a short-term play. Revenue generation has a far greater – and more immediate – impact on the underlying profitability and share price. Investment banks seeking to improve their long-term returns should therefore focus on creating new business lines and finding new revenue sources. The challenge for […]
Sector: Capital Markets: Results Review 3Q13 / 9m13
Capital Markets: Results Review 3Q13 / 9m13 The Top 13 investment banks’ 3Q13 revenue declined 13% versus 3Q12, erasing gains made in 1H13. A sharp decline in 3Q13/3Q12 FICC rates, credit and FX revenue was only partially offset by strong equity derivatives, cash (especially low-touch) and steady prime services. Headcount reductions continued in 3Q13, but at […]