Big Banking, Big Law - As Dealmaking Sours

 "More than $150 billion of mergers and acquisitions have been scrapped or stalled since the beginning of June, according to data compiled by Bloomberg." - Bloomberg, August 26, 2022.

This is a horrific development for Big Banking and Big Law. 

If the slowdown continues there could be a 10% RIF on Wall Street, as well as shabby bonuses for survivors. 

In Big Law there were no summer bonuses (a midsize firm did award them, though). And today the word out from Law.com is that manpower will be reduced through stealth layoffs and not filling jobs of associates who leave. 

Barclays projects an uptick in Q4 2022. 

On Reddit Big Law, here is a typical observation about the M&A space:

"Not many active deals, but I've been told by a couple partners that clients have pinged them on a good number of potential deals...they just are all on hold or moving at a snail's pace until market stabilizes."

With the global and US economy so filled with uncertainty, though, no institution should bet on a near-term turnaround in dealmaking. 

What's helping drive the souring of dealmaking are two factors: Difficulty raising funding and that the cost of the funding is higher. 

In Big Law this month a handful of firms did pick up M&A work. Those range from Paul Weiss to Freshfields. Meanwhile, though, in general demand has fallen off for a number of categories in transacational practices. Litigation is doing better than it had been. 

In my coaching of those in professional services - be it finance, management consulting, or law - there is concern about holding onto the job they have. Not getting ahead.

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