JPMorgan Chase & Co. (JPM) projects a 30% rise in its advisory activities in Asia on expectations of an increase in merger and acquisitions (M&A) deals in 2014, as per a Bloomberg report. The year 2013 witnessed a slump in M&A activities due to sluggishness in the Asian economies after a phase of rapid growth.
At present, the U.S. economy is showing signs of improvement and the European economy appears to be relatively stable. Therefore, JPMorgan foresees renewed interest of Asian economies toward increasing their deals and transactions in the European and American markets.
Further, in most of the consumption driven Asian economies, demands are increasing in direct proportion to the rate of economic growth. About 80% of the oil needs of these countries are met by import. Hence, JPMorgan anticipates a rise in energy deals as well, as most of these countries are looking forward to increase their energy reserve.
The banking behemoth has recently undergone a difficult phase and is still faced with some investigations and litigations. However, in spite of dealing with the challenges, JPMorgan has been improving its business. A higher ranking among Asian merger advisors in the forthcoming year will further serve as a partial respite for the company.
JPMorgan advised on 46 Asian deals this year including the merger deal between SM Land Inc. and SM Prime Holdings Inc. worth $7.3 billion. The merger is however yet to close. Among other banks, Morgan Stanley (MS) also advised on 46 Asian deals this year.
JPMorgan currently holds a Zacks Rank #3 (Hold). Some better-ranked major regional banks include Fifth Third Bancorp (FITB) and The PNC Financial Services Group, Inc. (PNC). Both these stocks carry a Zacks Rank #2 (Buy).