{"text":[[{"start":9,"text":"The profits of some Wall Street investment banks in mainland China hit record highs last year amid a sharp rise in trading, as global investors piled into the world’s second-largest economy."}],[{"start":20.15,"text":"The China securities units of Goldman Sachs, Morgan Stanley and JPMorgan posted record net profits in 2025, largely on the back of income from trading and brokerage, according to FT calculations."}],[{"start":33.65,"text":"The Wall Street lenders’ income in China comes largely from facilitating cross-border business, which has once again increased amid a surge in interest from trading firms and investors, while investment banking revenues — a traditional engine of growth — have remained weaker."}],[{"start":49.05,"text":"“Markets thrive in uncertainty but dealmaking does not,” said Han Lin, China country director of the Asia Group consultancy. “China’s slower growth, policy shifts, trade tensions have created volatility that is the bread and butter of trading desks.”"}],[{"start":65.25,"text":"The results mark a bright spot after years of stagnation since the Covid-19 pandemic era during which western investment banks reported losses or falling profits and reduced staffing levels."}],[{"start":77.8,"text":"Two years ago, JPMorgan chief executive Jamie Dimon said parts of the bank’s investment banking business had “fallen off a cliff” in China."}],[{"start":86.45,"text":"Overall commissions and fee income for Goldman and JPMorgan rose sharply, while investment banking revenue remained low. The outperformance was driven by revenues from brokerage."}],[{"start":97.3,"text":"JPMorgan said the bank’s China business had “grown 20 per cent annually for the past two years, and we are confident it will maintain that level this year”. "}],[{"start":107.05,"text":"Onshore fees from investment banking remained small except for Morgan Stanley, whose advisory income recorded onshore rose from Rmb123mn to Rmb312mn ($46mn). The mainland Chinese initial public offering market remains muted, with onshore deals dominated by local banks."}],[{"start":128.3,"text":"The onshore securities units’ results represent a snapshot of foreign banks’ China activities, which is valuable as global banks rarely break out their China revenue figures."}],[{"start":138.75,"text":"A significant proportion of revenue from cross-border activities including advising on Chinese IPOs or M&A transactions may be recorded by other entities."}],[{"start":null,"text":"
"}],[{"start":147.8,"text":"The Wall Street recovery stands in contrast with European rivals such as HSBC and Deutsche Bank, whose onshore China securities units continued to underperform. HSBC’s net profit from that division fell from Rmb169mn to Rmb102mn ($15mn) year on year, while it booked Rmb611mn in net commission and fee income."}],[{"start":174.10000000000002,"text":"Net losses at Deutsche Bank’s Zhong De joint venture, in which it holds a 33 per cent stake, worsened to Rmb93mn as investment banking and trading revenues both declined year on year. "}],[{"start":186.25000000000003,"text":"UBS, which last year received approval to fully own its mainland securities business, is the exception among the European banks."}],[{"start":195.10000000000002,"text":"The Swiss banking giant increased its net profit more than fivefold, led by an Rmb800mn increase in brokerage revenues to Rmb1.3bn ($191mn). In 2024 UBS also sold a stake in Credit Suisse’s China operations following the acquisition of its failed rival."}],[{"start":215.70000000000002,"text":"China allowed foreign banks to apply to fully own their own securities firms in the mainland since 2020, as part of other relaxations that followed decades of financial reform."}],[{"start":227.25000000000003,"text":"Other western professional services continue to struggle in China. Newly launched mutual fund companies since similar relaxations in asset management have acquired less than 1 per cent of the market, while there has been an exodus of US law firms."}],[{"start":242.40000000000003,"text":"Goldman, Morgan Stanley, HSBC and Deutsche Bank declined to comment. UBS did not respond to a request for comment."}],[{"start":251.00000000000003,"text":"Additional contributions from Cheng Leng in Beijing. Data visualisation by Haohsiang Ko in Hong Kong"}],[{"start":263.6,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1783246641_1666.mp3"}