Investment Banking Industry Profile

Companies in this industry underwrite, originate and maintain markets for clients issuing securities; they may also offer advisory services, help facilitate corporate mergers and other deals, or act as principals in buying or selling securities on a spread. Major companies include Goldman Sachs, Bank of America, and Morgan Stanley (all based in the US), as well as Barclays (UK), BNP Paribas (France), Nomura (Japan), UBS Group and Credit Suisse (Switzerland).

Worldwide revenue for investment banks was about $81 billion in 2018, down 3% versus the prior year, according to Dealogic. The US is the main driver of investment banking revenue, accounting for nearly half the annual total. However, European and Asian banks also are key players within the industry. Overall, the global investment banking industry has struggled in the aftermath of the financial crisis and ensuing regulatory changes that have made it harder to profit from their traditional lines of business.

The US investment banking industry includes about 3,400 establishments (single-location companies and units of multi-location companies). US revenue for the industry in 2018 was about $40 billion, according to Dealogic.

COMPETITIVE LANDSCAPE

Demand is driven by economic activity that results in company mergers, acquisitions, or public financing. The profitability of an investment bank depends on its ability to accurately assess both the value of a business transaction and the readiness of the market to buy the attendant debt or equity. Big ...