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JPMORGAN CHASE and the EVERCORE Investment Banks store moved Morgan Stanley as the main competition from Goldman Sachs in the field of Wall Street.
Jpmorgan Consulting fees generated last year – including mergers and acquisitions – of $ 3.29 billion, while Evercore recorded $ 2.45 billion and Morgan Stanley $ 2.38 billion.
Fusing fees and acquisitions are volatile between neighborhoods and even years, as they can run to tens of millions and are generally only paid when an agreement ends. But the costs of 2024 confirm a change in the hierarchical order of Wall Street in the last decade, with the arrival of JPMorgan, traditionally a lender superior to companies, as well as parasites such as Evercore as the main actors of the conference room.
Goldman Sachs Has long dominated the activities of advising the leaders of management on transactions. The latest data indicates that JPMorgan, however, cemented its position as the second largest employee, after having duel with Morgan Stanley until the 2010s.
Last year, JPMorgan reduced the gap with Goldman to his smallest in at least a decade. In the fourth quarter, he declared $ 1.06 billion in consulting costs – excluding stock income and debt subscription – beating Goldman for the second time in one year.
Evercore recorded $ 850 million in fees for the quarter and Morgan Stanley at only $ 779 million.
The mergers and acquisitions remain the Crown Jewel product in investment banks, with high transactions in terms of royalties which attract proportional costs. At the same time, the advice of mergers and acquisitions require only a handful of bankers, unlike the initial public offers or the emissions of bonds which require personnel armies.
“You provide advice that is not a commodity,” said Devin Ryan, analyst at Citizens JMP Securities. “And therefore the costs on transactions have therefore not been subject to pressure, as many areas within financial services.”
The change in Wall Street custody took place while Morgan Stanley concentrated resources on the construction of the wealth management activity, where it wins stable costs which are precious by investors.
Morgan Stanley was a traditional Blue Blood investment bank, leaving JPMorgan 90 years ago following the Glass-Steagall Act that separated advertising from the investment bank. Among his former students are Joe Perella, Bob Greenhill, Frank Quattrone and Paul Taubman, each of whom founded renowned charming banks.
His wealth management strategy was however defended by former managing director James Gorman, who withdrawn from the role At the end of 2023. His successor, Ted Pick, previously directed the investment bank of Morgan Stanley, which made hope for the actors of the company which he directed more resources towards them.
“There has been a lot of relief that Ted has become CEO on our side of the bank rather than an investment or wealth management guy,” said an investment banker Morgan Stanley.
However, bankers often work for years to promote relations with companies that can give lucrative industry costs, requiring a long -term commitment to the investment bank.
“Whatever the agreements this year, you won them three years ago,” said a former main investment banker in a large Wall Street company.
JPMorgan also invested massively in his mergers and acquisitions, using the wide range of products he offers to make his way in lucrative advisory mandates.
“At one point, they have become much more aggressive to say” hey, we are your biggest lender, so you should give us your advisory business “, said a managing director of Wall Street.
In 2023, the bank told investors that it had affected $ 200 million to hire “income producers” in its business and investment bank. Jamie Dimon, Director General of the Bank, is known to personally call customers coveted to make the case of JPMorgan.
“JPMorgan was very consistent and very dedicated to the growth of the investment bank,” said Ryan of citizens.
Evercore was among the biggest winners among a new shopping click that does not offer loan or trading services, winning the main mandates, especially on the sale of $ 29 billion in Calpine to Constellation Energy.
He also widened his consulting activities beyond the merger of mergers and acquisitions to private fund transactions and restructuring advice, where there is less competition from large investment banks.
“They did a lot to build their franchise and settle as an investment bank at first shop,” said Aidan Hall, analyst at Keefe, Bruyette & Woods.
Other challengers such as Jefferies also took advantage of the changes to Wall Street to grasp the land in investment banks. Jefferies reported $ 1.8 billion in consulting costs for the year to November, beating Bulge Banks of America and Citigroup after a recent hiring wave.
