US banks rake in cash from wave of big deals

WALL Street banking titans saw their revenues surge after a wave of deal-making.

Bank of America and Morgan Stanley led the charge, after both raked in more money between July and September than the same time last year.

Morgan Stanley’s investment banking revenues were up 67pc from a year ago to £2bn, driven by ‘record advisory revenues’ as it helped clients on their mergers and acquisitions.

This helped push total revenues up 26pc to £10.8bn, and profits up 37pc to £2.7bn.

Bank of America’s revenue climbed 12pc to £16.7bn and its profits rose 58pc to £5.6bn, as it released £804m of reserves it had set aside to cover loans expected to turn sour during the pandemic.

It added that investment banking fees had jumped 23pc to nearrecord levels of £1.6bn. And in its consumer division, deposits surged above $1trillion (£731bn) for the first time.

Citigroup’s revenues hit £12.6bn, down 1pc on last year, although profits were up 48pc to £3.4bn.

Chief executive Jane Fraser said: ‘The recovery from the pandemic continues to drive corporate and consumer confidence.’

The bank’s UK-born boss added that while customers have been holding onto more cash during the pandemic, which has hit Citi’s ability to lend, ‘we are seeing higher consumer spending across our cards products’.

Wells Fargo disappointed slightly as its revenue slid 3pc to £13.7bn, though profits climbed 59pc to £3.7bn as it was able to release £1.2bn which it had set aside to cover loan losses.

While the American economy returned to pre-pandemic levels of output this summer, fears have been growing over a steep rise in inflation.