What Was The Share Of Major U.S. Investment Banks In The Global M&A Industry For Q3?
Global M&A activity fell considerably over the third quarter of the year, with data compiled by Thomson Reuters showing that the total size of global M&A deals announced for the quarter was $748 billion – 21% below the $949 billion figure for the previous quarter, and 24% below the $980 billion in M&A deals announced a year ago. [1] Notably, the slowdown in M&A activity was seen across major economic regions quarter-on-quarter, and reflects the lukewarm macro-economic conditions prevalent worldwide over the period in the wake of the Brexit vote.
This had a visible impact on the volume of M&A deals announced by the five largest U.S. investment banks, which saw a proportionate reduction in deal volume this time around. However, these banks managed to maintain their market share figures around levels seen in the previous quarter thanks to their strength in the industry.
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In terms of completed M&A deals, Q3 2016 was actually a better period compared to Q2 2016 as total volume of closed deals increased from $803 billion in Q2 to $808 billion in Q3. This was because banks continue to work their way through the strong pipeline of M&A deals that have accumulated since early 2015. That said, deal volumes declined 7% year-on-year from $867 billion in Q3 2015.
It should be noted that the largest M&A deals employ multiple investment banks, so the market share figures in either table are not exclusive – explaining why total market share for these 5 banks in terms of deals completed is well above 100%.
Goldman took top honors in terms of deals completed as well as deals announced in Q3 2016. Notably, the investment bank has held the #1 rank for M&A deals completed worldwide in 15 of the last 20 quarters. You can see how changes in Goldman’s share of the global M&A industry impact our price estimate for the bank’s shares by making changes to the chart below.
See the links below for more information and analysis about the 5 largest U.S. investment banks:
- How Much In M&A Advisory Fees Did The 5 Largest U.S. Investment Banks Generate In 2015?
- How Much In Equity Underwriting Fees Did The 5 Largest U.S. Investment Banks Generate In 2015?
- How Much In Debt Origination Fees Did The 5 Largest U.S. Investment Banks Generate In 2015?
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment / ask questions on the comments section
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to the full Trefis analysis for Goldman Sachs | JPMorgan | Morgan Stanley | Bank of America | Citigroup
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- Investment Banking League Tables, Thomson Reuters Deals Intelligence [↩]