European Capital Markets Revenues Reached Record Highs in Q1 Boosted by Elevated Volatility and Despite Global Uncertainty

Morningstar DBRS released a commentary analysing Capital Market Revenues of European banks in Q1 2025.

Key highlights include
-- The European Peer Group's Q1 2025 capital markets revenues were significantly higher YOY and supported by strong growth in S&T revenues on the back of higher client activity and volatility.
-- European firms and U.S. peers showed similar capital markets revenue growth in Q1.
-- We continued to expect F2025 capital markets revenues to further benefit from still high market volatility and possibly outpace 2024 revenues.

"While S&T revenues reached record highs in Q1, there was already a noticeable slowdown in the growth of advisory and underwriting revenues," said Maria Rivas, Senior Vice President and Sector Lead, European Financial Institution Ratings at Morningstar DBRS. "For Q2, we expect S&T revenues to be exceptionally strong, as April showed one of the highest levels of volatility seen since the pandemic. Moreover, the current uncertain geopolitical and macro environment is expected to translate into lower-than-expected advisory and equity underwriting revenues for the rest of 2025, as we expect delays in any mergers and acquisitions and equity-raising deals."