US
Investment banking businesses weren’t doing particularly well to begin with this year. European ECM revenues fell 42% between January and April, and European M&A fell to its lowest level since 2003 in the first quarter
Until today, it seemed that ECM at least might perk up a bit after the UK election: earlier this week, The Times suggested that 15bn of IPOs were waiting in the wings.
Not any more. Nor does it look like the Prudential IPO, with its $660m of fees, is happening.
Meanwhile, Eurozone meltdown and risk aversion look certain to put the brakes on the high yield market. And the chaos and uncertainty will make large M&A deals impossible to execute.
“Anyone who works in investment banking and was about to do a deal is going to lost out from this,” says Ralph Silva, senior analyst at Tower Group. “I can tell you for a fact that a lot of organisations have called their investment bankers and said that they want to wait and see how this pans out.”
“ECM and M&A are going to be very tricky,” confirms Dirk Hoffmann Becking, a banking analyst at Sanford Bernstein. “However, once the European side stabilises, there may be M&A from the US into Europe as US organisations take advantage of the strong dollar.”
For the moment, however, most people in investment banking can kiss their hopes of being well paid in 2010 goodbye.
On a day like to today, I feel it deeply improper that all you can worry about are bonuses. Have you no soul?
Pardon?
Mr Outrage, maybe you should just leave early and get the Guardian.
I work in leveraged finance (HY) and your numbers are a joke. Pls check again re: issuance and deal values.. What a joke.
@Manthebig – the figures are from Dealogic, a well-reputed information provider. They show 2010 YTD HY bond issuance at $27bn, down from $57bn last year. I can check this with them, but they’re usually very reliable. These figures are for Europe alone.
european high yield has had it’s best start to a year ever, by a mile, not even a topic for debate.
@Calderaj+Manthebigman – I’ve removed the reference to hy while the figures are clarified.
EU HY was dead first half of last year….
@Man the big – I stand totally corrected. It turns out the figures I had were for ytd 2010 and fy09 and 08. I thought they were all ytd. You were right. I was badly wrong. I was hoping to sweep this quietly under the carpet…