U.S. Banks Poised for Robust Rebound in Investment Banking Income in 2024

Investment banking revenues at major U.S. banks are projected to bounce back in 2024, fueled by increased activity in mergers and debt transactions following a two-year downturn. According to Visible Alpha consensus estimates, income from investment banking operations at JPMorgan Chase (NYSE: JPM), Goldman Sachs (NYSE: GS), Morgan Stanley (NYSE: MS), and Bank of America (NYSE: BAC) is expected to increase by an average of 25% year over year in the upcoming second-quarter earnings.

For the full year, Bank of America is anticipated to experience the most significant growth in its investment banking income, rising by 29.3% from the previous year to $6.1 billion. Morgan Stanley is expected to see a 25.5% increase to $6.2 billion, followed by Goldman Sachs with a 23.7% rise to $7.7 billion, and JPMorgan Chase with a 23.6% increase to $8.1 billion.

Despite these gains, the 2024 estimates are still below the peak levels observed in 2021, when average investment banking revenue surged by 41% year over year, driven by record-low interest rates and government intervention during the pandemic.

JPMorgan Chase is set to report second-quarter results on July 12, with Goldman Sachs following on July 15, and Morgan Stanley and Bank of America announcing their earnings a day later.