Slowing global economic growth means the outlook for the world's investment bankers over the next 12 to 18 months is not as rosy as it was, according to ratings agency Moody's Investors Service. In a report, Moody's changed its outlook for global investment banks (GIBs) to stable from positive, citing moderate global economic growth leading to lower levels of client activity. Moreover, lower – or in some cases, negative – interest rates are also adding to revenue pressures. "The stable outlook for the global investment banks reflects our expectations that profitability for the GIBs may have peaked for this economic cycle," said Ana Arsov, a Moody's managing director. "Greater revenue headwinds will make further profitability gains more elusive, despite a continued focus on business re-engineering and technology investments to boost efficiency." Moody's forecasts slower global economic growth for this year and next, and said prospects were under threat due to escalating trade and geopolitical tensions. It also said that most of the G20 countries have "limited monetary and fiscal policy space for stimulating global aggregate demand". Investment banks face "modestly" higher credit costs despite low interest rates due to increased levels of leverage but most bank balance sheets remained strong, Moody's said. The amount of fees earned by investment banks has fallen by about 9 per cent year-on-year in the 12 months to August 22 to $62.9 billion (Dh231.1bn), according to Deals Intelligence. Banks have witnessed a slowdown in mergers and acquisitions activity, which has fallen 13 per cent to $2.48 trillion. Although global debt issuance has increased by 7 per cent to a little more than $5tn, syndicated loan issuance has dropped 23 per cent to $2.3tn and the global IPO market has declined by about one-third, with $84.55bn raised during the period, the data showed. JP Morgan remains the world's top investment bank, with a 6.6 per cent share of all of the investment banking fees earned so far this year. Goldman Sachs is in second place with a 6 per cent share and Bank of America Merrill Lynch in third with 5.2 per cent. The major US investment banks have outperformed European rivals, many of whom have faced pressures due to lower interest rates and a more challenging economic environment. Deutsche Bank last month announced a major restructure under which it will <a href="https://www.thenational.ae/business/banking/deutsche-bank-cuts-18-000-jobs-across-businesses-in-8-3bn-overhaul-1.883811">shed about 18,000 jobs</a> as the lender shrinks its investment bank, exits business lines such as equities trading to focus on transaction business. Swiss bank UBS is also reported to be considering <a href="https://www.thenational.ae/business/banking/ubs-mulls-investment-bank-overhaul-hundreds-of-jobs-at-risk-1.896373">a restructure of its own</a>, and <em>The Wall Street Journal</em> reported that both banks held talks in June about a merger but could not agree on terms.