Citigroup, UBS Exit Munis After Market’s Profits Plummet by 50%
- New research shows underwriter profit drop from 2005 to 2023
- Underwriters less able to raise investor markups, issuer costs
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Making money in the $4 trillion municipal bond market is harder than ever after a two-decade long drop in underwriting markups pinched bottom lines, contributing to pullback by major Wall Street firms such as Citigroup Inc. and UBS Group AG.
Profits for municipal underwriters fell by 30% to 50% from 2005 to 2023, according to a report to be presented next month at the Brookings Institution’s municipal finance conference.