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| Jon Macaskill is one of the leading capital markets and derivatives journalists, with over 20 years’ experience covering financial markets from London and New York. Most recently he worked at one of the biggest global investment banks |
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The sales and trading stumbles were embarrassing for senior managers and could feed into a broader reassessment of the post-crisis conclusion that flow is king and an emphasis on structuring a thing of the past.
Structuring provided a bright spot for some firms in the third quarter, and it is increasingly apparent that the opportunity for embedded proprietary risk-taking in client business lines will be key to future investment banking outperformance.
An indication of how this is likely to play out can be seen in the steps taken by market leader Goldman Sachs to cope with the new regulatory environment, including Dodd-Frank limitations on proprietary trading.
Goldman made a big play of the closure of its well-known Principal Strategies group. The bank sent public best wishes to nine US traders led by Bob Howard, who moved to KKR.
