Fitch: Weak FICC Results Limit Large U.S. Banks' Capital Markets Growth

Tue Jan 28, 2014 11:01am EST

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(The following statement was released by the rating agency) Link to Fitch Ratings' Report: U.S. Banking Capital Market Update: 4Q13 (Weak FICC Results Limit Overall Revenue Growth) here NEW YORK, January 28 (Fitch) Revenues from fixed income, currency and commodities trading (FICC) activities were challenged for the large U.S. banks and securities firms in 4Q13, limiting the overall growth in capital markets revenues, according to a special report published today by Fitch Ratings. Despite these challenges, aggregate capital markets net revenues moderately increased in 4Q13, and remained a significant contributor to consolidated revenues at 29% of the total. For the Global Trading and Universal Banks (GTUBs) based in the U.S., capital markets revenues comprised 22% to 62% of total revenues, which is dependent on contributions from other business segments. Looking toward 2014, lingering regulatory, economic and political uncertainty will be key drivers of activity levels. For example, Fitch believes that if the upcoming U.S. debt ceiling is not addressed in a timely manner, the resultant market uncertainty could contribute to a further reduction in capital markets activity in the first quarter. Conversely, a more substantial improvement in economic conditions and market sentiment could spur increase volumes and M&A activity. The full ‘U.S. Banking Capital Market Update: 4Q13’ is available at ‘www.fitchratings.com.’ Contact: Tara Kriss Senior Director +1-212-908-0369 Fitch Ratings, Inc. One State Street Plaza New York, NY 10004 Media Relations: Brian Bertsch, New York, Tel: +1 212-908-0549, Email: brian.bertsch@fitchratings.com. Additional information is available at 'www.fitchratings.com'. ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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