Investment banks that bucked the market downturn with fixed-income issues may soon be scrambling to find additional bond underwriting business, Reuters reports. Many investment banks posted strong revenues in the first quarter due to the boom in the bond market, and are likely to report strong earnings again in the second. But the big question many bond analysts are now asking is whether this can last.
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"I think there will be a shakeout on the debt side of the business because you are almost getting a bubble building in the debt markets at the moment," a senior executive at a bank told Reuters.
"It cant continue at the same pace, so the big question is can it stabilize or does it partially reverse," Chambers added.
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The staff of Money Management Executive ("MME") has prepared this capsule summary based on a report published by the news source to which it is attributed. Reuters is not associated with MME, and has not prepared, sponsored, endorsed, or approved this summary.