Hedge Fund Hell: Banks Jockey For Position
TheStreet.com, December 31, 2008
Summary: The competitive landscape among banks providing prime brokerage services to hedge funds has changed drastically. S3 Partners Managing Partner Robert Sloan quoted.
Citation / Quotations: Robert Sloan, managing partner at prime brokerage risk manager S3 Partners, says the competitive landscape has changed drastically, with Goldman and Morgan Stanley falling to second-tier status due to concerns about the strength of their balance sheet and subsequent cutbacks in the business. He says JPMorgan, Credit Suisse and Deutsche Bank are now the top prime brokers.
"What happened in September is hedge funds started to understand they're a counterparty to their prime broker. This is not a warm and fuzzy relationship-driven event," Sloan says, alluding to the bankruptcy of Lehman Brothers....
Sloan notes that Merrill's unrivalled access to retail investors, through its "thundering herd" of financial advisors, gives it a large inventory of securities it can lend out to hedge funds looking to short the market. (Securities lending is a major prime brokerage service.)
"Merrill should dominate the prime brokerage business," he says.
Full article from TheStreet.com at this link.
|
S3 Partners welcomes media inquiries.
S3 Partners' media contact is:
Mr. Robert Sloan, Managing Partner
robert.sloan@s3partners.net
Office: 212 715-4300
If you contact S3 Partners via e-mail, please indicate in the subject line if your matter is time-sensitive. |
