The Americas and Europe are running neck and neck as corporate and investment banks prepare to celebrate another year of bumper growth in global capital markets.¹ New McKinsey research shows that bank revenues from global capital markets rose 14 percent, to almost $215 billion, in 2005 and increased a further 40 percent in the first six months of 2006. Even though disappointing third-quarter results from some major institutions have injected a note of caution into 2006 as a whole, breaking through the $250 billion barrier seems likely.

With Europe and the Americas almost identical in market size at the end of 2005, Europe is set to take the crown if current trends continue. Asia’s share of the global pool remains significantly smaller than that of the other two regions—but its potential is large, especially in emerging markets outside Japan.

These headline findings from the Global Capital Markets Survey, the first comprehensive benchmarking of capital market business performance,² reveal the scale and strength of the corporate and investment banks’ capital markets businesses. But a more detailed analysis of the data highlights how the incoming tide of capital markets activity is not lifting all ships equally. Some players have grown...