Investment Banking Merger Rumours

Although 2005 may have been a good year generally for M&A, we haven't seen anything happening on the merger front involving the large commercial/investment banking players. But there have been plenty of rumours.............

And Morgan Stanley has been at the centre of many of these - that is before John Mack came back on his white charger to rescue the firm. By any standard, Morgan Stanley was a firm adrift earlier this year, especially during the last few weeks of former CEO Philip Purcell's reign. There was talk of a mega-merger with JP Morgan and also a tie-up with HSBC. In the end, it was just Mack who came back.

That old favourite, a Bank of America/Barclays Bank deal was back doing the rounds again this year, as was a possible tie-up between BofA and Fidelity. Then there was the rumour that Allianz was putting DrKW on the block. That one really proved to be wide of the mark. And shares in Charles Schwab rose 15% one day in July, after rumours circulated that the firm was negotiating a sale to either Fidelity or HSBC. Nothing came of that one either. And although Credit Agricole was said to have signalled its intent to enter into a series of cross-border mergers to beef up its asset management and investment banking franchise, nothing happened. Rumours were also flying around that Nomura was close to buying a niche investment bank in the US. And although the firm said that a move like that may be consistent with its strategy, it all quickly went quiet.

Finally, rumours about Bear Stearns also did the rounds this year. HSBC was touted as a potential suitor twice during the year. That that other old chestnut, a SocGen/BNP Paribas deal, also had its five minutes of fame.

So, although the rumours about investment banking mergers made interesting reading this year, nothing really big actually went down. So much for speculation. But there is always next year...........................

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