Wall Street banks benefited from a surge in mergers and acquisitions in Q4 that boosted investment banking fees.

Dealmaking was also propelled by a strong US economy, interest-rate cuts, and expectations of lighter regulation under incoming US President Donald Trump.

“We are executing against four pillars – strategy, culture, financial strength and growth – that support our integrated firm, creating long-term value for our shareholders,” CEO Ted Pick said, citing growth in investment banking and wealth management.

Morgan Stanley’s investment banking revenue rose 25% to US$1.64 billion, echoing results at rivals Goldman Sachs and JPMorgan, which also reported stronger profit yesterday.

Its earnings grew to US$3.7 billion, or US$2.22 per share, it said today, compared with US$1.5 billion, or 85 cents per share, a year earlier.

Shares of the bank rose 1.1% before the bell.

Globally, investment banking revenue jumped 26% to US$86.80 billion in 2024, according to data from Dealogic.

Wall Street CEOs and dealmakers expect more large deals to be approved under the Trump administration than his predecessor Joe Biden.

Investment banks also cashed in on rallying equities, which encouraged initial public offerings and follow-on stock sales, while lower borrowing costs led companies to issue bonds.