SURVIVING THE BIG BANG
Not every merchant bank believes that piling on capital, dual capacity and trading power is the way to deal with the Big Bang. Some believe that they have niches in the market which can be developed and expanded without panic or huge expense. And the advent of highly capitalized foreign houses hardly perturbs them. Euromoney spoke to three specialist merchant banks, Baring Brothers, Lazard Brothers and J Henry Schroder Wagg. Are they prepared for what will hit them this October?
"Before the announcement of the Big Bang the merchant banks were all similar in attitude and in strategy,' said Andrew Tuckey, a managing director of Baring Brothers. "Apart from their size there was very little to distinguish between them.'
Now, he suggested, three distinct groups of merchant banks vary according to their aspirations for the future. The top-flight banks have global ambitions and aim to be fully integrated. At the other extreme there will be those which do not pretend to understand the securities markets and which will concentrate on their traditional strengths as advisers and corporate finance specialists. In the middle of these two will be those which will adopt a little of each.