Surging revenue at its investment bank and wealthy-client brokerage lifted Bear Stearns ( BSC) to first-quarter profit that was up 32% from a year ago, making it the latest Wall Street firm to sail past earnings estimates. The brokerage earned $361 million, or $2.51 a share, in the latest quarter, compared with earnings of $274 million, or $2 a share, last year. Net revenue rose 14% to $1.7 billion. Analysts surveyed by Thomson One Analytics were expecting earnings of $2.05 a share on revenue of $1.52 billion. Bear's biggest division, capital markets, sells market-making and investment banking services. Total revenue in the segment rose 9% to $1.4 billion, reflecting a 4% jump in bond market-making revenue to $822 million and a 35% jump in investment banking revenue to $253 million. Institutional equity revenue jumped 8% to $297 million, a gain that was largely attributable to the December death of legendary Wall Street trader John Mulheren. Mulheren was a partner in clearing firm Bear Wagner Specialists, a unit that became majority owned by Bear Stearns in the absence of his partnership interest. The attendant change in the accounting treatment for the unit made up "a substantial portion of the increase in net revenues." Despite ongoing probes into the role Bear Stearns' clearing operation might have played in the mutual fund trading scandal, the unit saw revenue jump 24% to $217.6 million, as average customer margin debt balances surged 28% to $46.6 billion. "More robust customer activity was also apparent in stock borrow and customer short balances, which approached all time highs during the first quarter of this year," the company noted. At its wealth management segment, revenue rose 32% to $152.8 million, reflecting "more favorable equity markets" that led to increased customer activity. Revenue in its private client services division shot up 32% to $110.9 million, reflecting a "rebound in the equity markets, increased trading volume and the continued hiring of highly productive brokers."