A growing number of investment banks are expanding their energy operations to get a share of the sector pie currently dominated by Goldman Sachs and Morgan Stanley. Those two banks, according to Reuters, each earned more than $1.5 billion last year from energy and commodities contracts.
“I think some of the first-tier banks will start feeling the pressure from second-tier banks that have been expanding aggressively,” ABN Amro‘s Wayne Harburn told Reuters. Among those mentioned in the energy push are Barclays Capital, UBS, Merrill Lynch and Credit Suisse. In an interview with Reuters, Boston Consulting Group says, “Competition is certain to increase; as a result, participants will need to fully leverage core banking capacities in order to protect and grow share.”