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.
Fixed-income trading at Lehman Brothers accounted for more than half the firms total revenues in the first quarter, Derek Chambers, a European banking analyst at HSBC, told Reuters. At Goldman Sachs, it represented more than 40%, and at Deutsche Bank, Morgan Stanley, JP Morgan and UBS, bonds brought in about 30% of the business.