Investment banks post huge drop in income
Source: Agencies |
March 22, 2011, Tuesday
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Print Edition
Print Edition
INCOME for top investment banks fell by almost a quarter last year to US$167 billion from a record performance in 2009, according to an industry report.
The drop came as staffing levels at the top 10 investment banks recovered to pre-crisis levels of about 66,000, following a 10 percent drop during the financial crisis, according to the study released yesterday.
Coalition, an independent research firm for the investment banking industry, said income for the top 10 investment banks fell 23 percent from a record US$219 billion in 2009. Income had slipped to US$124 billion in 2008 from US$184 billion in 2007.
The London-based research firm said bankers in fixed income generated more income than their peers, bringing in an average of US$3.7 million per person last year, almost double the average US$1.8 million generated by bankers in equities and origination.
Fixed income has consolidated its position as the dominant driver of revenues in the last four years, Coalition said, despite greater market volatility.
Fixed income contributed US$94 billion of revenues last year, or 56 percent of the total, down from the record US$139 billion in 2009 but up from US$83 billion in 2007, when it accounted for 45 percent of overall revenues.
Equities brought in US$37 billion last year, down from US$55 billion in 2007, while origination and advisory revenues were US$36 billion in 2010, down from US$47 billion three years earlier.
The report estimated that the top 1,000 clients accounted for more than 65 percent of the banks' revenue pools.
The drop came as staffing levels at the top 10 investment banks recovered to pre-crisis levels of about 66,000, following a 10 percent drop during the financial crisis, according to the study released yesterday.
Coalition, an independent research firm for the investment banking industry, said income for the top 10 investment banks fell 23 percent from a record US$219 billion in 2009. Income had slipped to US$124 billion in 2008 from US$184 billion in 2007.
The London-based research firm said bankers in fixed income generated more income than their peers, bringing in an average of US$3.7 million per person last year, almost double the average US$1.8 million generated by bankers in equities and origination.
Fixed income has consolidated its position as the dominant driver of revenues in the last four years, Coalition said, despite greater market volatility.
Fixed income contributed US$94 billion of revenues last year, or 56 percent of the total, down from the record US$139 billion in 2009 but up from US$83 billion in 2007, when it accounted for 45 percent of overall revenues.
Equities brought in US$37 billion last year, down from US$55 billion in 2007, while origination and advisory revenues were US$36 billion in 2010, down from US$47 billion three years earlier.
The report estimated that the top 1,000 clients accounted for more than 65 percent of the banks' revenue pools.
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