LONDON, Dec 6 (Reuters) – President-elect Donald Trump’s return to the White House is anticipated to ignite a revival in dealmaking, potentially driving global investment banking income to $316 billion in 2025—a 5.7% increase compared to 2024, according to data seen by Reuters.
M&A bankers are projected to earn around $27.6 billion in fees, according to previously unreported data from analytics provider Coalition Greenwich, marking what could be their second-best year in at least two decades.
The data highlights that global investment banking income has exceeded $300 billion only five times in the last 20 years. Recent years were challenged by the pandemic, inflation, and global political instability, limiting revenue growth.
Trump’s pro-business stance is expected to support the already robust U.S. economy, potentially encouraging higher volumes of cross-border deals and attracting investment from European firms seeking growth, industry insiders said.
“I know it’s that time of year where bankers love to be bullish, but we genuinely believe that political clarity and macroeconomic stability will drive M&A activity,” said Richard King, head of corporate banking, EMEA, at Bank of America.
“There’s significant pent-up demand that will likely materialize in 2025,” he added, pointing to private equity investments and acquisitive trade buyers across sectors such as healthcare, technology, and energy.
Trump’s administration is also expected to be more favorable to M&A activity by allowing deals to proceed that were previously blocked due to competition or strategic concerns, according to bankers.
Strong Year Ahead for Debt and Securities Trading
Bankers managing corporate and government debt sales could see record revenues, projected to reach $49 billion in 2025. Securities trading, the largest contributor to investment bank income, is forecasted to generate $220 billion, the highest figure since 2022.
Credit and emerging markets macro products are expected to see a 6% increase, while trading in interest rate-related products may decline by 3.5%, the data reveals.
“We have healthy corporate balance sheets, but the higher cost of capital means businesses need to be proactive,” said Taylor Wright, co-head of global banking at Barclays. He predicted robust private equity activity as both buyers and sellers of assets.
“Geopolitical risk is the wild card. While difficult to plan for, absent such disruptions, the next 12 to 24 months look very promising for investment banking,” Wright added.
Salaries and Hiring Expected to Rise
As revenue grows, banker compensation is expected to follow suit, though bonuses may not yet reach the peak levels seen in 2021. New York-based pay consultancy Johnson Associates forecasted salary increases across most business units, with real estate investing being a notable exception.
Banks are also ramping up hiring in response to Trump’s re-election, particularly in securities trading and roles ranging from junior to senior positions, according to recruiters.
Natalie Nicolaou, Senior Manager at Robert Walters UK, noted, “There’s a renewed focus on recruitment as banks aim to strengthen their teams in early 2025, traditionally a period for headcount reductions.”
With the industry poised for growth, 2025 could prove to be a pivotal year for global investment banking.
