Morgan Stanley (MS) CEO James Gorman apologized to analysts on Wednesday for having a cold while discussing the company’s first-quarter results. What those results also confirmed is that a key source of revenue for Wall Street is ailing, too.

Investment banking fees in the first quarter dropped 24% at the bank from the year-earlier period as deal making dried up amid a rapid rise in interest rates, economic uncertainty, and the failures of two sizable regional banks in March.

And it wasn't just Morgan Stanley that reported a slowdown in the most glamorous service Wall Street firms provide. All of the major banks that advise on mergers or IPO underwriting reported drops in fee revenue during the quarter when compared with the same period a year earlier.

The largest decrease of 26% belonged to Goldman Sachs (GS), which typically outdoes its rivals when it comes to M&A advisory work, followed by a 25% drop at Citigroup (C) and a 20% drop at Bank of America (BAC). Even JPMorgan Chase (JPM) saw investment banking revenue down 19%. All are down even more when compared to the same period in 2021.

Morgan Stanley CEO James Gorman acknowledged to analysts Wednesday that underwriting and M&A "remain very subdued" but "these are revenues delayed, not dead."

Goldman CEO David Solomon said in a conference call with analysts on Tuesday that he expects "big strategic" deal activity in the second half of the year.

Other firms across the world had similar problems in the first quarter. Global M&A volume sank to its lowest level in 11 years during the first quarter, according to Dealogic, down 48% from the first quarter of 2022.

"Just when many thought a corner had been turned, global dealmaking plumbed another low in the first quarter," Dealogic said in its report about the quarter.

It wasn't long ago that deal making was responsible for helping Wall Street churn out record profits. The last boom came in 2021, when CEOs used surging markets as a reason to buy other companies, go public, or take on new debt.

Then came a year that most of Wall Street would like to forget.

In 2022, three major stock averages fell by the most since 2008 and bonds had their worst year on record. Inflation reached its highest level in four decades, triggering an aggressive series of interest rate hikes from the Federal Reserve.

All of that new economic uncertainty curbed the optimism needed from the corporate clients that are the lifeblood of Wall Street's investment banking business. As a result, bonuses were slashed and jobs were cut.