Buoyed by a booming M&A market, business confidence levels are at a near-record high with senior business lawyers predicting robust income growth over the next year.

The latest Legal Week/ EJ Legal Big Question business confidence survey has revealed that 95% of respondents expect their firm's total income from fees to increase over the next 12 months, with nearly two-thirds predicting double-digit growth.

Though confidence is marginally lower than the last quarter, when 97% said they expected fee income to grow, it is still extremely high, with none of the more than 100 senior commercial lawyers surveyed expecting fee income to fall over the next year.

The survey highlighted how much confidence there is in the market, with 61% saying they expect to see at least double-digit growth in fee income over the next 12 months.

Of these, nearly half (41%) said they expect fees to grow by 10%-15%, with a further 17% predicting increases of 15%-25%. Another 3% went further still, saying they think fees will rise by more than 25%. Only 5% of respondents said they expect fee income to stay the same.

Simon Firth, a derivatives partner at Linklaters, told Legal Week: "In comparison to two or three years ago there has been an incredible rebound in confidence in the City, and we are busy across all sectors. The economy tends to go in 10-year cycles and, as we started moving north two or three years ago, we should hopefully have a few more good years yet."

Peter King, a corporate partner at Shearman & Sterling in London, said: "The year has started pretty well and there is lots of work in the pipeline. There is always a degree of volatility, but there are no signs of that at the moment. The indications point the other way, with lots of transactions from financial and strategic buyers."

Paul Claydon, head of corporate at Morrison & Foerster in London, said: "We are well ahead of budget for the first quarter already, and I would expect us to stay busy."

When asked which practice areas would receive most investment over the next 12 months, the overwhelming majority of those polled (62%) said corporate finance would be the biggest beneficiary. This put it substantially ahead of its nearest rival – banking – which took just 13% of the vote.

Next in line for investment were litigation (10%) and property (5%). Tax, insolvency, projects and intellectual property all received 2% of the vote.

Despite their confidence in the levels of M&A activity, some partners warned that there was a risk that there is too much money in the market at the moment, which could lead to bad investment decisions ultimately dampening M&A activity.

One corporate partner at a top City firm said: "I would be surprised if we did not see a double-digit increase in fee income this year, as all departments are busy, but there is a danger that the market is becoming frothy and over-valued."