Risk Management

12:57 PM
Connect Directly
Facebook
Google+
LinkedIn
Twitter
RSS
E-Mail
50%
50%

Investment Banking Is On The Verge of A Comeback – and Dimon Laughs Out Loud

Dimon makes a "classic" public quip in a heated exchange with an industry analyst.

Although jobs in capital markets continue to be slashed on a regular basis, investment banking is about to make a comeback, according to Bloomberg Magazine’s April issue.

Since 2008, M&A deal volume has slumped, the industry has seen broad pay cuts, huge amounts of new regulation and has often been derided by the public (alla Occupy Wall Street), but investment banking is on the verge of a comeback, according to Bloomberg’s data.

This year has already seen several big M&A deals. Dell and private-equity firm Silver Lake Management LLC agreed last month to take Dell Inc. private for $24.4 billion ,in the biggest leveraged buyout since 2007. A few days later, Warren Buffett announced he would partner with Brazilian billionaire Jorge Paulo Lemann to buy H.J. Heinz Co. in a $23 billion deal.

“I hesitate to be the one that says 2013 will be the year, because invariably it may not,” says Christian Meissner, BofA’s head of global corporate and investment banking, told Bloomberg. “But I think that we’re pretty close to it changing."

Meanwhile, JPMorgan was No. 1 in the Bloomberg 20, Bloomberg Markets’ ninth annual ranking of the best-paid investment banks measured by the fees they earn. The bank took in $3.97 billion in fees last year, a 24.8 percent increase over 2011.

All this news is surely giving CEO Jamie Dimon even more reason to smile - if he ever needed it.

In an exchange with an analyst that Rolling Stone’s Matt Taibbi calls “priceless,” Dimon had an unexpected quip after being asked about banks’ capital ratios.

Obnoxious, much?

Taibbi points out that Dimon's first instinct is to misinterpret analyt Mike Mayo's question, while also admitting that his bank has a lower capital ratio than UBS.

“So Dimon thinks he's pushing Mayo around, and thinking he's a big tough guy doing it, but actually he's just helping Mayo make his point,” says Taibbi.

“It's classic,” he adds.

Melanie Rodier has worked as a print and broadcast journalist for over 10 years, covering business and finance, general news, and film trade news. Prior to joining Wall Street & Technology in April 2007, Melanie lived in Paris, where she worked for the International Herald ... View Full Bio

Comment  | 
Print  | 
More Insights
Comments
Newest First  |  Oldest First  |  Threaded View
IvySchmerken
50%
50%
IvySchmerken,
User Rank: Author
3/5/2013 | 6:48:11 PM
re: Investment Banking Is On The Verge of A Comeback – and Dimon Laughs Out Loud
While this is a funny "I gotcha moment" for Jamie Dimon, banks are obviously not happy about having to increase their capital ratios and would rather pocket the money in the form of higher bonuses. Given JPM's problems with the "London Whale" and complex derivatives, higher capital ratios are there for a reason.
Register for Wall Street & Technology Newsletters
White Papers
Current Issue
Wall Street & Technology - Elite 8
The in-depth profiles of this year's Elite 8 honorees focus on leadership, talent recruitment, big data, analytics, mobile, and more.
Video
Inside Abel Noser's Trading Floor
Inside Abel Noser's Trading Floor
Advanced Trading takes you on an exclusive tour of Abel Noser's New York trading floor, where the agency broker known for transaction cost analysis, is customizing algorithms for the buy side, while growing its fixed income trading and transitions business.