U.S. Firms Win Share in European Investment Banking, Report Says
JPMorgan Chase & Co. (JPM), Goldman Sachs Group Inc. and BNP Paribas SA have been gaining market share in European investment-banking fees as most Swiss and European securities firms retreat, Freeman & Co. reported.
The European banks including the Swiss are “recognizing” they don’t need to be “in every product or geography,” and are relying on steadier fee earners such as their wealth-management businesses, the New York-based research firm said today in an e-mailed report. Other companies including Credit Agricole SA (CA), Credit Lyonnais SA and Commerzbank AG have exited or closed parts of their investment-banking businesses, reducing market share, according to the Freeman report.
“The result is that European firms share of total investment-banking fees are down 20 percent post-crisis,” Freeman said. “Firms in Canada, Asia, Australia and South America have benefited as European firms shrink.”
Most European securities firms have struggled as the sovereign debt crisis hurt revenue, and regulators force them to hold more capital and limit compensation. UBS AG (UBSN), Switzerland’s largest bank, announced plans last year to eliminate 10,000 jobs and exit most debt-trading businesses to concentrate on money management and boost profitability.
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