Goldman Sachs and JPMorgan this week reported records in their prime brokerage businesses. Morgan Stanley, the industry's top prime broker, reports earnings on Thursday.The Archegos debacle began rearing its head at the end of March, and within weeks, it became clear
"You've obviously seen open expressions by other firms who are looking to reduce down their prime business. We're going the other way. We want to grow that business," CFO Stephen Scherr also said on the call, adding that"clients in motion around prime" were flocking to Goldman as well as others. Moreover, the dust is still settling at the Swiss lender, and competitors will pick up more business over the next two months as Credit Suisse continues to unwind its book, sources said.
Banks can only grow their prime businesses so much before bumping into regulatory hurdles and constraints on resources and capacity, but thus far the confluence of events in prime brokerage this year has amplified the multi-year trend of increasing market share among the top firms.
It's left to interpretation but I think it's a good sign and central to the overall theme of the stockmarket from the last 7 days.
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