Lazard's profit surges on asset management inflows amid market volatility

May 1 (Reuters) - Investment bank Lazard LAZ.N reported a 67% jump in first-quarter profit on Friday, as resilient client demand boosted its asset management business during a period of heightened market volatility.

Market swings, driven by tensions between major powers and uncertainty around interest rates and AI disruption, can lift activity for asset managers as clients adjust portfolios, boosting inflows and fee-based revenue.

Lazard ended the quarter with $266 billion in average assets under management, compared with $231 billion a year earlier. Asset management's fee-based revenue is more predictable and helps cushion earnings.

Lazard's net revenue climbed 17% in the quarter to $757 million, with asset management reporting a 42% surge. In a statement, Lazard CEO Peter Orszag said that the M&A revenue was affected by timing of deals closing.

'WINDOW OF OPPORTUNITY' IN U.S.

But despite the effect of market volatility created by the Iran conflict, the pipeline is resilient, Orszag told reporters on Friday.

"There are some powerful forces operating in the M&A world, including the window of opportunity with regard to the regulatory environment, especially in the United States, and the march of technology, including AI, that is requiring firms to reconsider what they are doing".

Wall Street's biggest banks had also said they still expect 2026 to be a strong year for dealmaking, though Middle East turmoil has pushed back some activity.

Global M&A revenue jumped 19% in the first quarter to a record $11.3 billion, Dealogic data showed, driven by technology - particularly artificial intelligence - as well as healthcare and financial services, where some of the largest deals were struck.

Lazard's notable transactions in the quarter included Keurig Dr Pepper's $23 billion acquisition of JDE Peet's and Zurich Insurance Group on its offer for Beazley.

Its restructuring and liability management practice handled debtor roles for several high-profile clients including auto firm First Brands and tech firm Xerox Holdings XRX.O.

Net income rose to $101 million, or 91 cents per share, in the three months ended March 31. That compares with $60 million, or 56 cents per share, a year earlier.