Simon Thomas
02-10-2009, 11:13 AM
The old prime brokerage model is dead - what will replace the likes of Lehmans, Bear Stearns. Does anyone carethat they have imploded?
Tim Reucroft
02-18-2009, 05:40 PM
As somebody once said - "It's sellers that make a market". Think about that and then consider that with short selling effectively banned and stock lending all but dried up, then it's no wonder the markets are not functioning.
With no more SLB, no more hedge funds and traditional custody not making any money - how will the monoline custodians survive? Will Thomas Murray have any business left?
Simon Thomas
02-26-2009, 03:54 PM
On the institutional side (buy side) of the street our target market is primarily asset owners and not currently fund managers or hedge funds. If the hedge funds reduce from 9,000 to 3,000 TM won't care. If prime brokers reduce from 24 to 10 it simplifies our analysis of these beauties. If fund managers merge or implode who cares as they are not our primary clients. Where we have chased these clients eg New Star they got bought -its just not worth the effort unitl the rationalisation of these intermediaries has slowed to a trickle. We are interested in specialist segregated asset managers (St James's crowd) and globally pension funds, public funds, foundations, charities, insurance companies, investment trusts. There are thousands of such funds getting screwed by their banks and with SLB drying up treasury, FX and other charges will sky-rocket - they will need more help over the next few years than ever before. If in servicing these groups we have fewer suppliers to assess great.
On the wholesale or sell side of the street our target market is banks and brokers. These little darlings need technology and data and ratings. The cost pressure they are under is great for our business. We will end up doing specialist ratings for JP Morgan prime broking and treasury etc. New models will emerge BOA/ML, Goldman/SSB, JPM/BS, etc