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Despite moments of sharp market volatility brought about the US tariff saga and a smorgasbord of geopolitical, political, economic and monetary factors, global investment banking ( IB ) fees were broadly stable year-over-year in the first half of 2025 at US$60.5 billion. There was some regional jockeying, though: a 5% decline in fees in the Americas and 10% decline in EMEA was counterbalanced by a 27% increase in Asia-Pacific ex-Japan and a 3% rise in Japan.
The fact that IB fee generation has kept up is to some extent testament to the ingenuity and staying power of investment bankers, but perhaps much more so to the ingenuity, staying power and composure of their clients. Even if deal-making conditions aren’t the best and IB fees remain stable, big pick-ups in trading volumes expected over 2025 – traders love volatility – look like they are going to power banking profits for firms with large IB divisions.
By IB product, debt capital markets had a record half – volumes hit an all-time record of US$6.4 trillion – pushing underwriting and distribution fees up 2% to US$21.6 billion. Completed merger and acquisition ( M&A ) fees were stable at US$16.9 billion. Acquisition financing volumes rose 7% but overall syndicated lending volumes fell 4%, dragging fees down 10% ( to US$13.4 billion ). Equity capital markets fees held up the product rear-guard, at US$8.1 billion, albeit that represented a rise of 6% year-over-year.
Eternally positive
Talking of M&A, I have never ceased to be amazed at the irrepressible optimism of advisory bankers through the cycles, even in the face of crushingly poor conditions. I guess it’s an essential condition of their craft to bat away negativity and find reasons to predict an upturn just around the corner. For over five years now, the world has been beset by factors that have delayed, dissuaded or derailed M&A activity:
The Covid pandemic in 2020 and the eye-watering global economic crash to which it gave rise.
The sharp reversal and the spike in growth the following year, which offered promise but dashed by Russia’s full-scale invasion of Ukraine, the fastest rise in interest rates in years, and the cost-of-living crisis.
Deadly conflict in the Middle East.
And now the US tariff farce, a US-China trade war, question marks over the future shape of global trade, and the global hegemony of the US dollar.
All accompanied by anaemic global economic growth.
Yet, M&A bankers find solace, comfort and reasons to be optimistic. A quick perusal of media coverage of M&A activity sees one gushing, effusive M&A banker quoted after another.
Renewed optimism is a common general refrain. Expectations of a blockbuster rest of the year are a platitudinous classic. As are: deals put on hold returning to the market; growing confidence that the worst of the turbulence is over; equity inflows signalling a stronger dealmaking environment; probabilities of US$50 billion-plus deals rising; a fall in the volatility index; client momentum continuing to build; and executives feeling more positive.
That latter one is common rejoinder to slack activity, and holds that executives have started to become attuned to or have adjusted their mindsets to an environment of constant volatility and have started to zone out of the constant negative news flow and morale-sapping headlines and events and are instead working with their financial advisers to turn less-than-perfect market conditions to their advantage on price, timing and/or deal structure.
And feeling comfortable about being able to do that, given the leaner, meaner, more efficient balance sheets that those negative conditions have engendered.
Deal pick-up
To be fair, a few big deals in recent months have helped boost market morale. In fact, global announced M&A volumes rose by a third year-over-year in the first half to US$1.98 trillion, the best H1 for three years ( although that’s not saying much, given the above ). There was a variety of types of activity behind the headline number.
Broadband and cable operator Charter Communications’ merger with Cox Communications was the largest year-to-date at US$35.2 billion. The restructuring of Toyota Group involving the take-private of Toyota Industries followed closely behind in size. Holcim’s spin-off of its North American business; Alphabet’s acquisition of cybersecurity firm Wiz; Adnoc and OMV’s joint merger of subsidiaries Borouge and Borealis and acquisition of Nova Chemicals to create a petrochemicals behemoth; and OpenAI and Oracle’s data-centre deal all weighed in at US$30 billion or more.
So let’s see.
While listing those mega-deals, incidentally, I felt it was nothing more than my duty to draw your attention to Cox’s hilarious and appallingly pretentious corporate tag-line: that it is “committed to creating meaningful moments of human connection through technology”. On Planet Earth, it’s just another broadband company.
OpenAI’s mission is “to ensure that artificial general intelligence – AI systems that are generally smarter than humans – benefits all of humanity”. Kind of positive but rather creepy.
Toyota, meanwhile, has crafted an equally fatuous and ludicrous mission: "producing happiness for all”. A bit like M&A bankers.
