Oliver Wyman – How European Wholesale Banks Can Seize The Moment

European wholesale banks are in a positive position due to a favorable interest rate environment, which allows for increased earnings and sustainable returns. The implementation of new capital rules could provide an advantage for European banks compared to their US counterparts. After a period of restructuring, European banks are now leaner and more focused, with the ability to generate returns above the cost of capital. Revenue pools for European wholesale banks have grown by 20% since 2019, reaching $195 billion in 2023, with an expectation of sustained growth. Despite weaker investment banking and equities revenue, European banks have benefited from a strong presence in these areas. The shift in the economic cycle has highlighted the benefits of a diversified and stable universal banking model for European wholesale banks.