For Wall Street, It’s Risk On and On and On

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It’s happening. That’s the signal coming from Wall Street’s dealmakers, who see the long logjam in asset sales beginning to break. Goldman Sachs expects this year alone to be close to a record, with more jumbo deals in the works. You can see it already in the bidding war for Warner Bros. Discovery, which may herald a potential bonanza of giant loans. Chief executives at Bank of America and Mizuho are similarly upbeat.

AI lending is another undeniable boon to banks as data centers build out and users embrace actual uses. There’s so much borrowing that bankers are wondering if they’d like a little less of it, with sober minds thinking about the wisdom of lending for decades to an often profit-free business that makes itself obsolete every few months. Amid the frenzy, at least one study has concluded that AI isn’t coming for your banking job, at least not yet, and instead may spur a boom in headcount (along with higher costs for awhile).

Also booming is Citigroup. Once famous mainly for its stumbles, the bank under Jane Fraser is now worth at least the sum of its parts for the first time in years. HSBC’s Georges Elhedery is cutting his own swath through his bank’s bureaucracy, with particular focus on getting rid of co-headed departments. The problem, he has determined, is that when more than one person is responsible for something, no one is responsible. — Rick Green