Lehman Brothers is struggling to close the gap on its rivals in European investment banking, despite heavy investment and aggressive recruitment in the past three years.

While the bank has increased its investment banking revenues in Europe by 24% to an estimated $521m (€391m) since 2000, according to research firm Dealogic, Lehman has not seen a discernible improvement in its league table rankings in the past few years. It is 12th in the overall ranking of European investment banking fees this year, with a share of 2.8%, up one place from 13th in 2000, when it had a market share of 2.4%. Over the past seven years, it has finished in the top 10 only once, in the 2002 M&A league tables. It has not finished in the top 10 in the debt or equity capital markets rankings. So far this year, it is 13th in M&A, 12th in ECM and 14th in DCM. Lehman is planning to continue hiring bankers in an attempt to win business, and has reshuffled its investment banking team. The bank played down its league table rankings and said revenues continued to rise in the European business. As a proxy for the European business, the accounts for Lehman Brothers International (Europe) Ltd filed with Companies House in the UK, show revenues were flat in 2005 compared with the previous year at $1.18bn. Revenues are up 43% across the business since 2002, but are 21% below 2000 levels, according to the accounts.