Assessment of the impact of macroeconomic, market, and institutional factors on the development of investment banking in Russia

Abstract

This article aims to assess the current state of investment banking in Russia and to identify the nature and strength of the relationship between its dynamics and key macroeconomic, market, and institutional factors. The research methodology relies on a correlation analysis of data covering the period from 2021 to 2025. The volume of the Russian mergers and acquisitions (M&A) market serves as the outcome indicator, while the factor indicators include the GDP growth rate, the Bank of Russia’s average annual key interest rate, the inflation rate, the sanctions pressure index, and the Moscow Exchange Index. The author’s findings reveal varying directions and strengths in the relationships between the factors under study and M&A market dynamics. The strongest positive correlations were found with GDP growth and the state of the stock market, whereas sanctions pressure, key rate hikes, and inflation showed an inverse relationship with investment banking activity. Conclusions: The development of investment banking in Russia is driven by the combined impact of macroeconomic, market, and institutional conditions. The results indicate that increased investment banking activity is statistically linked to accelerated economic growth and a stronger stock market, while intensified sanctions pressure and rising costs of financial resources are associated with a decline in such activity. These identified relationships can be used for further research into the factors driving investment banking development and for constructing a model of its dynamics.