In light of the failures like Lehman Brothers, the talk is that the investment-banking model is essentially broken. As a result, Goldman Sachs Group, Inc. (NYSE: GS) and Morgan Stanley (NYSE: MS) are now crusty-old bank holding companies.

But, there are still some investment banks left -- such as Lazard Ltd. (NYSE: LAZ). For the most part, the firm has weathered the financial storm pretty well. However, Q3 was still rough for Lazard; there was a net loss of $77 million or $1.17 per share (which compares to a profit of $40.3 million or $0.73 per share in the same period last year). Yes, you can blame the market instability as well as some purchases of the asset management business. Keep in mind that Lazard was a prime broker with Lehman.

For the most part, Lazard remains focused on advisory services, especially in M&A. And, the firm keeps snagging marquee deals, like the transactions for Gaz de France and Fortis NV. Unfortunately, with the credit crunch, it's becoming extremely difficult to finance acquisitions. It looks like Lazard may show continued weakness for awhile.

Although, one bright spot is M&A in the financial services industry. With the injection of billions in federal investments, it looks like we will see a pick-up in dealmaking in the sector.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Streetsmart Guide to Short Selling: Techniques the Pros Use to Profit in Any Market. He is also the founder of BizEquity, a valuation website.

Lazard trips up originally appeared on BloggingStocks on Wed, 29 Oct 2008 16:00:00 EST. Please see our terms for use of feeds.