ZACKS·2025-10-20 14:41Core Insights - Major U.S. banks reported significant growth in investment banking revenues for Q3, indicating a revival in deal-making activity after a prolonged slowdown [1][10] - The positive trend in investment banking is supported by strong advisory revenues and a favorable market environment, with expectations for continued growth into 2025 and beyond [3][4][10] Investment Banking Revenue Growth - Goldman Sachs reported IB fee revenues of $2.7 billion, a 42.5% increase year-over-year and 21.3% sequentially, driven by higher advisory revenues and M&A volumes [3] - JPMorgan's IB fees rose to $2.6 billion, reflecting a 17.1% year-over-year growth and a 4.5% increase from the previous quarter, supported by strong advisory and underwriting performance [4] - Morgan Stanley achieved IB revenues of $2.1 billion, up 44.1% from the prior year and 36.9% sequentially, fueled by increased deal-making and IPO activities [5][6] - Bank of America reported IB fees of $2.0 billion, a 43.5% year-over-year increase and 41% from the prior quarter, bolstered by higher advisory and underwriting income [7] - Citigroup's IB fees reached $1.2 billion, up 17% year-over-year and 10.5% sequentially, driven by growth in advisory revenues and capital markets [8] Market Outlook - Executives from major banks expressed optimism about the deal pipeline and M&A sentiment, anticipating continued growth in investment banking through 2025 [10][12] - Management highlighted that sustained growth in investment banking will depend on stable macroeconomic conditions and interest rates [10][11] - The current favorable environment for M&A is expected to persist, with banks investing in their IB franchises to support future growth [7][12]