Morgan Stanley’s focus on the equity trading business since 2012 has made it the largest player in the industry over recent years, and has helped the bank’s equity trading desk contribute more than 23% of its total revenues for 2016. These operations are also an equally important part of Goldman Sachs’ business model. In comparison, the more diversified business models and smaller equity trading desks of JPMorgan, Bank of America and Citigroup resulted in these operations only contributing between 4-6% of their top lines.
Despite strong equity trading volumes over the second half of 2016, major investment banks reported a decline in total equity trading revenues for the year compared to 2015 due to the weak first half performance. Notably, the seasonal securities trading business sees the most activity in the first quarter of the year, and a weak Q1 2016 weighed on the total figure. This, in turn, led to a reduction in the share of equity trading revenues for each of these banks compared to 2015. But equity trading revenues are expected to increase sharply in 2017, and this should help increase their share in the top line of all banks this year.
- Morgan Stanley’s Q1 Results Show That Its Long-Term Growth Plan Is Aligned With U.S. Economic Outlook
- Bank of America Closed Most M&A Deals In Q1 Despite Sluggish Industry Conditions
- How Have Debt Origination Deal Volumes For U.S. Investment Banks Changed In The Last 5 Quarters?
- JPMorgan’s Q1 Debt Originations Were The Best By Any Bank In Five Years
- Goldman Sachs Bests JPMorgan To Grab Largest Equity Underwriting Share In Q1
- U.S. Banks’ Share Of Global Equity Capital Markets Increases After Shrinking For Three Consecutive Quarters
See the links below for more information and analysis about the 5 largest U.S. investment banks:
- How Have Securities Trading Revenues At The 5 Largest U.S. Banks Changed In The Last 5 Years?
- How Much Did The 5 Largest U.S. Investment Banks Make Through FICC Trading Activities In 2016?
- How Much Did The 5 Largest U.S. Investment Banks Make Through Equity Trading Activities In 2016?
- How Much In M&A Advisory Fees Did The 5 Largest U.S. Investment Banks Generate In 2016?
- How Much In Equity Underwriting Fees Did The 5 Largest U.S. Investment Banks Generate In 2016?
- How Much In Debt Origination Fees Did The 5 Largest U.S. Investment Banks Generate In 2016?
- How Much In Total Advisory & Underwriting Fees Did The 5 Largest U.S. Banks Earn In 2016?
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 comment 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