The large multinational bank Citigroup (C 3.12%) by and large reported solid third-quarter earnings, as the bank benefited from the higher interest rate environment and continued to make progress on a multiyear transformation plan.
But one weak point in the quarter was the bank’s investment banking business, which has seen its revenue plummet on a year-over-year basis after a spectacular performance in 2021.
Yes, the entire investment banking industry is struggling, but Citigroup seems to be struggling more than its peers right now. Let’s take a look at why this might be and if investors should be concerned.
The size of the wallet has shrunk
Within investment banking, there are three main sub-businesses: mergers and acquisitions (M&A) advisory, equity underwriting, and debt underwriting.
M&A advisory is pretty much what it sounds like: helping companies that are purchasing another company or selling to another company. Equity…
