“Big Finance” comes out of its decade-long slump as bankers bounce back

The financial sector was hammered by the crisis of 2008. Now, bankers are rediscovering their swagger, says Matthew Lynn.

JPMorgan Chase head office
JPMorgan Chase delivered results way in excess of expectations
(Image credit: © Spencer Platt/Getty Images)

We’ve got used to the idea that Big Tech has done well out of the Covid-19 crisis, with the likes of Amazon, Apple and Google soaring in value. It turns out that Big Finance is having a pretty good crisis too – and it is about to come out of its decade-long slump. Last week Goldman Sachs delivered its best third-quarter results ever, driven by rising profits on trading and asset management. JP Morgan Chase, its closest rival, delivered results way ahead of analysts’ expectations, and so did Citigroup and asset-management giant BlackRock.

And it wasn’t just the big beasts of Wall Street. In London, Man Group reported sharply higher earnings and rising assets under management; stockbroker Hargreaves Lansdown saw rising profits as small investors in particular flock to the market. The same is true across Europe. On Tuesday this week, the Swiss giant UBS reported a near doubling of profits on strong results from its wealth-management unit. At this rate, even Deutsche Bank might post some decent figures. True, retail banking is having a tough time, but the investment banks and hedge-fund managers are doing better than ever.

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Matthew Lynn

Matthew Lynn is a columnist for Bloomberg, and writes weekly commentary syndicated in papers such as the Daily Telegraph, Die Welt, the Sydney Morning Herald, the South China Morning Post and the Miami Herald. He is also an associate editor of Spectator Business, and a regular contributor to The Spectator. Before that, he worked for the business section of the Sunday Times for ten years. 

He has written books on finance and financial topics, including Bust: Greece, The Euro and The Sovereign Debt Crisis and The Long Depression: The Slump of 2008 to 2031. Matthew is also the author of the Death Force series of military thrillers and the founder of Lume Books, an independent publisher.