Several investment bank head interviewed by the Financial Review
questioned the profitability of a number of their competitors.
Macquarie Groupís Greg Ward, deputy managing director of Macquarie Group told the newspaper there were too many investment banks in Australia.
"It strikes me there is too much capacity in the market for the volume of transactions," Ward said.
"How many of these competitors have made money consistently; I think that would be a different answer than how many competitors are here."
Goldman Sachs Australia chief executive Simon Rothery told the AFR that "if you look at volumes and you look at primary equity issuances, I donít know how anyone is making money in their equities business outside the top one or two at the moment."
Investment banking heads from Morgan Stanley, Noumura, Citi and Bank of America Merrill Lynch all offered more optimistic views, though BA-ML's chief executive, Craig Drummond, said there was too much capacity in a product such as equity research.
On the other hand Drummond predicted that "youíre going to see more Asian names and more Chinese names."
One of those names is Malaysia bank CIMB, which bought the equities capital markets business of Royal Bank of Scotland.