Where the European Fee Pool Moved in 2026
European exchanges raised €99.4bn of equity in the first half of 2026, 68% more than the €59.3bn raised a year earlier. IPO proceeds came in at €8.6bn, up from €4.6bn (AFME, Equity Primary Markets and Trading Report Q2 2026, July 2026). Announced M&A in Europe reached €788bn, almost 80% ahead of the €438bn announced in the first half of 2025. Read at face value, that makes 2026 Europe's strongest year since 2022.
Leveraged finance tells a different story. European leveraged debt markets produced €130bn in the first quarter, 18.9% down on the same quarter last year and 16.2% down on the one before. Leveraged loan origination fell 27.1% to €81.8bn and high yield issuance fell 25.3% to €21.8bn (AFME, European High Yield, Leveraged Loan and Private Credit Report Q1 2026, June 2026).
The gap between those two sets of numbers is widening quickly, yet most of the hiring decisions we're seeing this month are still being made off the headline. With budget season six weeks away, it's worth diving deeper into the landscape.
1. Equity Capital Markets Carried the Year
The recovery in equity capital markets is genuine, but it's narrower than 68% suggests. Secondary offerings made up €80.2bn of the €99.4bn, up 65%, with convertibles adding another €10.6bn. IPOs are where we'd be more careful. Proceeds rose sharply, but the number of listings barely moved: 45 in the first half of 2026 against 44 a year earlier. Private equity backed IPOs actually fell, from €2.3bn to €1.4bn.
In other words, deals got bigger, not more frequent. A large listing pays well but doesn't need many more bankers than a mid cap one, so a head of ECM who reads the IPO number as a case for a bigger syndicate team has picked the wrong variable. The desks that genuinely grew this year were the ones with strong corporate broking and accelerated bookbuild capability. A good IPO pitchbook had less to do with it.
A useful question for any ECM head: which were the last three accelerated bookbuilds you lost, and who won them?
2. Leveraged Finance Shrank and Changed Address
The bank led market contracted while direct lending grew. European direct lending origination reached €26.4bn in the first quarter, up 39.6% year on year, while syndicated loans and high yield both fell by more than a quarter. Euro private credit yields dropped from 9.3% to 8% over the same twelve months, which is what you'd expect when there's more capital than there are deals.
The mix matters more than the totals. Refinancing made up 78% of leveraged loan proceeds and half of high yield issuance. Direct lending, by contrast, put 29% into LBOs and 26% into acquisitions. Put simply, the syndicated market is rolling over existing debt while private credit finances the new deals. A desk doing mostly refinancing isn't growing, however busy it looks.
If you're interviewing someone from one of these desks, ask what share of their last twelve months was refinancing. How long the answer takes is often as revealing as the answer itself.
3. The Flow Businesses Outperformed
Origination gets the headlines, but some of the steadiest revenue this year came from flow. EU and UK sovereigns issued €1,149bn of bonds and bills in the first quarter, up 4.8% on last year and 31.1% on the previous quarter, and European government bond trading volumes averaged their highest level on record, 8% up year on year (AFME, Government Bond Data Report Q1 2026, July 2026). Equity turnover across European venues rose 21% in the first half.
Securitisation is the more interesting case. Issuance fell 12.7% to €64.3bn in the second quarter, but the share actually placed with investors jumped from 47.5% to 81.1%. Pan European CLOs accounted for €14.9bn and UK RMBS for €12.4bn (AFME, Securitisation Data Snapshot Q2 2026, August 2026).
That placement figure is the one we'd pay attention to. When a market places four fifths of what it issues, rather than under half, it has become a distribution business, and that needs salespeople with real client relationships. It's worth checking how many of your recent securitisation hires actually came from a distribution seat.
4. Headcount Lags the Fee Pool by About a Year
This one we can put numbers to. Revenues at the twelve largest global investment banks rose 9% in 2024 to $262.9bn, but their operating costs rose just 3.4% to $159bn. Around $60bn of that, roughly half, went on front office pay and benefits (Coalition Greenwich, Corporate and Investment Bank Spending in Unpredictable Times, September 2025). Costs moved at about a third of the pace of revenue. Investment banking revenues across the same group then rose another 13.3% in the first half of 2025 (Coalition Greenwich, Coalition Index for Investment Banking, 1H25, October 2025).
That gap is essentially the recruitment cycle. Revenue comes in, the budget committee waits to see if it holds, and hiring gets signed off in the next planning round. So by the time a European ECM desk has its 2027 headcount approved on the back of a strong first half, the market will have moved on, and the handful of people really worth hiring will have been talking to other firms since spring.
A word of caution
European averages hide a lot. SIX Swiss Exchange led equity underwriting in the first half at €17.1bn, followed by Madrid (€15.0bn), Frankfurt (€10.3bn), Paris (€9.7bn), London (€8.2bn) and Amsterdam (€6.6bn). One very large deal can reshuffle that table, and a single strong half doesn't make a trend for any one country.
Nor is every leveraged finance team shrinking. Much of that volume has gone to private credit funds, and they're hiring hard. The work hasn't disappeared, it has changed employer, which is a different problem for a head of desk and a cheaper one to solve.
Where this leaves hiring
The European fee pool didn't really grow or shrink in 2026. It shifted towards ECM, M&A advisory and flow distribution, and away from bank led leveraged lending, with private credit picking up the slack. When the picture varies this much by product and by country, a single firm wide headcount plan isn't much use.
There's a catch, too. If every competitor reads the same AFME data and decides to add ECM and sponsors coverage, they'll all chase the same obvious names in the same eight week window, and whoever moves last will pay the most.
That's why the real work now is research, not reaction. Who are the four people in Paris running accelerated bookbuilds for large cap corporates? Finding out means mapping the function from the mandate outwards and talking to bankers who aren't looking to move. The same goes for the credit officer on a shrinking syndicated desk whose judgement makes them worth redeploying rather than replacing. Neither will turn up on an applicant list, because neither has any reason to apply. In a year when the money moved this unevenly, the firm that does the mapping first will have the better list by October.
Sources: AFME, Equity Primary Markets and Trading Report Q2 2026, 29 July 2026; AFME, European High Yield, Leveraged Loan and Private Credit Report Q1 2026, 3 June 2026; AFME, Government Bond Data Report Q1 2026, 1 July 2026; AFME, Securitisation Data Snapshot Q2 2026, 5 August 2026; Coalition Greenwich, Corporate and Investment Bank Spending in Unpredictable Times, 3 September 2025; Coalition Greenwich, Coalition Index for Investment Banking 1H25, October 2025.
