Goldman Sachs predicts blockbuster 2026 for M&A mega-deals

Goldman Sachs is predicting a blockbuster 2026 for mega-deals across Wall Street as it and the other US banking giants unveiled a string of bumper financial results this week.

Goldman shared Thursday it raked in a company record $9.3 billion in investment banking fees for 2025, up 21% from $7.7 billion a 12 months in the past.

It and the 5 other major US lenders — Morgan Stanley, Citi, Wells Fargo, JP Morgan, and Bank of America — picked up a mixed income of $593 billion in 2025, a 6% increase from the earlier 12 months, and some $157 billion in earnings, up 8%.

Goldman Sachs CEO David Solomon said Wall Street’s investment bankers might be in for “a very, very good year” in 2026. Michael Brochstein/ZUMA Press Wire / SplashNews.com

Morgan Stanley said Thursday that it noticed investment banking income rise to $7.6 billion in 2025 from $6.1 billion a 12 months earlier — setting the scene for fat-cat bonuses that will probably be announced over the coming days.

Goldman CEO David Solomon shared his rivals’ optimism about the coming 12 months, saying “a likely scenario” is that 2026 will probably be “a very, very good” 12 months for Wall Street’s investment bankers and M&A advisors.

“The world is set up at the moment to be incredibly constructive in 2026 for M&A and capital markets,” he said on a call with analysts.

“I think over the next few years, barring some sort of exogenous event that slows it down, we are going to have a pretty constructive environment for those activities,” the Wall Street veteran added.

He also took a thinly veiled swipe at the Biden administration, which some industry insiders blame for taking an overzealous strategy to crimson tape and policing mega mergers.

“We had a very, very different environment from a regulatory perspective for M&A for the last four years,” Solomon explained.

If the forecasts flip out to be right, Wall Street bankers will probably be in for a bumper payday this 12 months amid a surge in M&A exercise. REUTERS

Global M&A volumes swelled to $5.1 trillion in 2025, up 42% from 2024, according to data from Dealogic.

“CEOs definitely believe that ‘The Art of the Deal’ – scaled consolidation – is possible now,” the 63-year-old said in an obvious reference to President Trump’s ebook on business negotiations.

“CEOs and boards are looking and saying: ‘We’ve got a window here of a handful of years where the opportunity to consider big strategic, transformative things is certainly possible.’”

The Post understands the company’s deal pipeline, financial jargon for the quantity of potential transactions booked by a firm that are yet to close, is at its highest level for 4 years.

Top dealmakers have been inspired by an enhancing M&A setting, helped by decrease charges set by the Federal Reserve. Its chair, Jerome Powell, is at present being probed by the DOJ over its $2.5 billion HQ revamp. by way of REUTERS

Solomon’s remarks got here amid the Trump administration’s strikes to slash rules, Fed Reserve charge cuts, and spare money on company books that may be deployed for attainable takeover targets, sparking a flurry of deal exercise.

That is despite the longest-ever US authorities shutdown, which ran from October to mid-November, and ongoing investor concern over Trump’s see-sawing tariff coverage.

Goldman bankers labored on some of the largest mergers of 2025, including the $56.5 billion leveraged buyout of Electronic Arts and Alphabet’s $32 billion acquisition of cloud safety firm Wiz.

Morgan Stanley CEO Ted Pick warned of the “complicated” financial setting in addition to “geopolitical swirl” that might upend any of the bank’s forecasts for new transactions. REUTERS

Those outsized offers helped Goldman secure the top spot as soon as again for global M&A in 2025, with the bank advising on $1.48 trillion in whole quantity of offers and raking in $4.6 billion in fees.

The success at 200 West Street, Goldman’s main headquarters, was mirrored at crosstown rivals Morgan Stanley, Citigroup, and JPMorgan, which posted on Wednesday full-year investment banking fees of $9.7 billion, compared with $9.1 billion a year ago

Citi CEO Jane Fraser is in the midst of executing her strategic plan to revive the bank’s fortunes and catch up with other Wall Street rivals. Its share price has soared by practically 50% over the past 12 months, and stood at $117.15 last evening. REUTERS

Morgan Stanley’s chief financial officer, Sharon Yeshaya, shared the upbeat temper on Wall Street.

“We are seeing an accelerating pipeline in M&A and IPOs,” she said, including that the bank expects more offers in the healthcare and industrial sectors.

But CEO Ted Pick also warned of the “complicated” financial setting, in addition to “geopolitical swirl” that might upend any of the bank’s forecasts for new transactions.

“We are keeping full watch on potential M&A,” said the Harvard Business School alum. “But we will continue to be patient.”

Jane Fraser-led Citigroup said its investment banking fees rose 22% in 2025 to $4.4 billion, up from $3.6 billion the previous year.

Citigroup, which has long lagged behind its Wall Street rivals, poached Vis Raghavan from JPMorgan to spice up its investment banking team.

It is an element of Fraser’s reorganization of the company. She offered a plan in late 2023 to increase earnings, streamline operations, and handle long-standing deficiencies in the bank’s data governance and risk management.

The overhaul has triggered a wave of exits in the wealth and technology models of the bank, with the latest shuffle elevating Gonzalo Luchetti to succeed Mark Mason as chief finance officer.

Fraser is also aiming for even larger earnings in 2026, with objectives like a 10% return on key investments and reducing prices, including headcount, to run the business more effectively.

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