With hedge funds showing signs of life, banks are polishing up their prime broking arms. The Wall Street Journal reports that Citigroup has added 18 people to its prime broking business so far this year and that BofA/Merrill intends to add 40.
The return to prime broking recruitment comes amidst a shakeup in the sector which has seen the big established players (Goldman Sachs and Morgan Stanley) suffer, and almost everywhere else benefit. This is generating movement. Last month, Morgan Stanley appeared to dump Stu Hendel and hired Alex Erlich from UBS to replace him as head of prime brokerage. Deutsche Bank cited prime broking as a strong growth area in its first quarter report and according to a recent presentation by Alliance Bernstein analysts, Deutsche, together with Credit Suisse, BNP Paribas and custodians are all growing in pb.
Citigroup withholding severance to some former execs. (Naked Capitalism)
Citigroup are wagering that the former executives will conclude that it would be publicly embarrassing for them to file lawsuits against the struggling, taxpayer-backed company. (Business Insider)
Nomura poaches former Lehman banker from Barclays. (Wall Street Journal)
Credit Suisse hires new CFO of investment banking operations. (DealBook)
Goldman raises $1.9bn in ICBC stock sale. (Bloomberg)
JPMorgan wants to repay TARP by the end of June. (Clusterstock)
Abu Dhabi investors to sell $6.8bn Barclays stake. (Bloomberg)
Hedge funds to pay staff in capital gains and avoid 50% tax. (Financial News)
New rules for Swiss banking pay. (Wall Street Journal)
How online gambling is keeping bankers rich. (Style)
When layoffs are immoral. (NYTimes)