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Oct 18, 2013

Morgan Stanley profit beats Street as equity trading surges

By Lauren Tara LaCapra

(Reuters) – Morgan Stanley posted a higher-than-expected quarterly profit on Friday as stock trading revenue jumped 31 percent, a surprisingly strong performance in a quarter when most rivals posted smaller gains or even declines in that business.

The rise in stock trading revenue offset most of the decline in fixed-income, currency, and commodity trading, where revenue fell 44 percent. Morgan Stanley has had difficulty with fixed-income trading for years, but in the third quarter weak market conditions also shook most of the bank’s competitors.

Oct 17, 2013

Goldman slashes pay as revenue plunges

Oct 17 (Reuters) – Goldman Sachs Group Inc slashed
employee compensation costs by 35 percent in the third quarter
as bond-trading revenue plunged, an unusual step that signals
the bank’s concern about performance for the rest of the year.

Revenue from trading fixed-income, currency and commodity
products for clients, one of the bank’s biggest businesses,
tumbled 44 percent in the quarter, Goldman reported on Thursday.
Excluding an accounting adjustment, the drop was 47 percent, a
much sharper decline than those posted by rivals. The bank’s
shares were down 2.4 percent in late-morning trading to $158.43.

Oct 17, 2013

Goldman third quarter revenue down 20 percent, bank slashes costs

By Lauren Tara LaCapra

(Reuters) – Goldman Sachs Group Inc (GS.N: Quote, Profile, Research, Stock Buzz) on Thursday said third-quarter revenue plunged 20 percent, hurt by weak mortgage and bond-trading results, but profit dropped only slightly as the Wall Street bank slashed compensation and other expenses.

Revenue from trading fixed-income, currency and commodity products for clients, one of the bank’s biggest businesses, plunged 44 percent, a much sharper decline than those posted by rivals. Goldman said revenue from investing its own money in bonds and loans fell 46 percent. The bank’s shares fell 2.6 percent in pre-market trading.

Oct 17, 2013

Goldman 3rd-qtr revenue down 20 pct, bank slashes costs

Oct 17 (Reuters) – Goldman Sachs Group Inc on
Thursday said third-quarter revenue plunged 20 percent, hurt by
weak mortgage and bond-trading results, but profit dropped only
slightly as the Wall Street bank slashed compensation and other
expenses.

Revenue from trading fixed-income, currency and commodity
products for clients, one of the bank’s biggest businesses,
plunged 44 percent, a much sharper decline than those posted by
rivals. Goldman said revenue from investing its own money in
bonds and loans fell 46 percent. The bank’s shares fell 2.6
percent in pre-market trading.

Oct 16, 2013

As companies plan for U.S. default, business may take a hit

NEW YORK (Reuters) – Delayed investments and purchases by companies and investors struggling to limit their exposure to financial harm from a possible U.S. debt default is contributing to a slowdown in business activity, executives said.

Investment firms and big Wall Street banks, including PIMCO, Fidelity Investments, Blackrock Inc (BLK.N: Quote, Profile, Research, Stock Buzz), Citigroup Inc (C.N: Quote, Profile, Research, Stock Buzz) and JPMorgan Chase & Co (JPM.N: Quote, Profile, Research, Stock Buzz), said they had sold Treasury bonds that expire in the coming weeks, either to protect clients’ investment portfolios or their own balance sheets against losses in the event of a U.S. default.

Oct 16, 2013

For U.S. bond traders, the Grinch may steal bonuses

NEW YORK, Oct 15 (Reuters) – With anemic bond trading
revenue over the past few months hurting Wall Street profits,
pay cuts and even layoffs are back on the table just when the
future had started looking up for traders.

Overall, bonuses on fixed-income, currency, and commodity
trading desks will likely be down 10 percent to 15 percent, said
Alan Johnson, head of the Wall Street compensation consulting
firm Johnson Associates. It could be the third or fourth year in
a row in which some Wall Street bond traders get $0 bonus
checks, he added.

Oct 10, 2013

Former examiner sues NY Fed for alleged Goldman Sachs-related firing

NEW YORK, Oct 10 (Reuters) – A former senior bank examiner
at the Federal Reserve Bank of New York filed a wrongful
termination lawsuit on Thursday, saying she was fired after
refusing to alter a critical examination of Goldman Sachs Group
Inc.

The former employee, Carmen Segarra, said that in her seven
months of examining Goldman’s legal and compliance divisions,
she found the bank did not have policies to prevent conflicts of
interest as required by regulation, a conclusion that might have
caused a downgrade of the Wall Street bank’s regulatory rating.

Sep 30, 2013

Wall Street banks likely stung again by bad bond-trading quarter

NEW YORK (Reuters) – Wall Street banks have had another rough quarter in bond trading thanks to the U.S. Federal Reserve, and it might get worse before it gets better.

Analysts have begun cutting third-quarter profit estimates for banks including Goldman Sachs Group Inc (GS.N: Quote, Profile, Research, Stock Buzz) and Morgan Stanley (MS.N: Quote, Profile, Research, Stock Buzz), citing an industry-wide fixed-income trading revenue decline of 20 to 30 percent compared with a year ago. The quarter’s lull has made at least some Wall Street professionals nervous that a fresh round of job cuts may be coming, a trader said.

Sep 24, 2013

Regulators haven’t solved ‘too big to fail’: Morgan Stanley executive

By Lauren Tara LaCapra

(Reuters) – The problem of some banks being “too big to fail” remains because global regulators have not come up with a coordinated way to wind them down without causing market-wide disruptions, a senior Morgan Stanley executive said on Tuesday.

Colm Kelleher, head of Morgan Stanley’s institutional securities business, said that while the system is safer now than it was at the peak of the financial crisis in 2008, competing regulatory agendas in Europe, the UK and the United States have hampered progress. Because global banks are large and interconnected – through short-term loans and derivatives contracts, for instance – one bank getting into trouble could still have wide-ranging effects, he said.

Sep 24, 2013

Regulators haven’t solved ‘too big to fail’ -Morgan Stanley exec

Sept 24 (Reuters) – The problem of some banks being “too big
to fail” remains because global regulators have not come up with
a coordinated way to wind them down without causing market-wide
disruptions, a senior Morgan Stanley executive said on
Tuesday.

Colm Kelleher, head of Morgan Stanley’s institutional
securities business, said that while the system is safer now
than it was at the peak of the financial crisis in 2008,
competing regulatory agendas in Europe, the UK and the United
States have hampered progress. Because global banks are large
and interconnected – through short-term loans and derivatives
contracts, for instance – one bank getting into trouble could
still have wide-ranging effects, he said.