Take on Bear Stearns?
What's your guys take on BS? I know one graduating senior at my school that's going there and he's a complete dbag. Is that the norm there?
What's your guys take on BS? I know one graduating senior at my school that's going there and he's a complete dbag. Is that the norm there?
Career Resources
Yeah of course, thats how it works. Wankers goto Morgan Stanley, Douche Bags to BS, Idiots to ML, fuckers to JPM, Assholes to GS and so forth
hahahaha. I actually know alot of people there and I can safely say that most are pretty cool guys.
-
Stfu Ben
I know one guy going into their TMT group and hes a nice guy. He's into tanning tho so he might qualify for douchebag status, im not sure.
FYI, Girls would rather fuck a tan, lean guy than a white, fat one...
Which division are you talking about?
yeah, but if he tans, he probably doesn't like girls...
not a great office, as of 2 yrs ago. i worked with a girl who was in BS-NY office. she said SF office was small, didn't do too many trsx and wasn't well know. as for LA office, my guess is it's even smaller.
Is Bear Stearns still a good place to work? (Originally Posted: 07/24/2010)
I know they went bankrupt but to work for their groups might still be impressive on a resume? Help urgent summer internship
Yup, just go apply on their website.
Very impressive... and I hear almost as hard to get as a DLJ internship.
I think I would do lehman instead
Will Bear Stearns be taken over? (Originally Posted: 02/15/2008)
I've heard people speculating about this. It doesn't seem like any other firm is in good position to buy them at this point.
buyout of big ibanks rarely work because of culture clash and ego....think dlj, salomon Smith Barney, montgomery etc. commercial banks have said acquiring pure ibanks looks great on paper and in theory, but could never work b/c of cultural differences. i think bear is more likely to get help from a foreign entity than be bought out. i'm not too sure what the deal is with citic.
http://www.forbes.com/afxnewslimited/feeds/afx/2008/02/15/afx4661292.ht…
http://dealbook.blogs.nytimes.com/2008/02/15/bear-and-citic-said-to-ren…
It seems the buyout is more and more likely. Could Citic possibly buy Bear?
Bear Stearns (Originally Posted: 07/26/2006)
Does anybody know what's going on with these guys? It seems like they're the only firm left not to release numbers, and the word is their analysts are only bumping to 65. Any insight...it seems like this could hurt future recruiting.
Rumor is they get word on Tuesday and get paid 2 days later. I'm sure, though, that if 2nd years didn't end up getting the BB standard, it would hurt analyst retention more than anything.
Bears are cute animals.
It's a dawg eat dawg world.
bump
Stay away from Bear Stearns? (Originally Posted: 10/06/2007)
At this point, would it be advisable to not apply/stay from Bear Stearns Fixed Income division?
I just started in their energy trading group and no signs of trouble here.
really? no signs of trouble at all?
Also curious about this. What are the best groups in BS Fixed Income (besides mortgages)? Is FAST a good place to start for fixed income trading? Research?
Also curious about this. What are the best groups in BS Fixed Income (besides mortgages)? Is FAST a good place to start for fixed income trading? Research?
I was searching for something particular and I found this gem from 2007. Capt. Hindsight.
Bear Stearns SA and FT - Rumors are true (Originally Posted: 04/04/2008)
JPMorgan will revoke half of Bear Stearns' outstanding undergraduate offers, including nearly all M&A and equities offers.
http://biz.yahoo.com/rb/080404/jpmorgan_bear.html
My condolences to all those affected.
2 Days late and an internship short. Keep on top of things pal.
so are they canceling ALL IBD offers? i got a FT offer, but have not been called yet. all of the folks who have accepted FT IBD offers have kept in touch via email, and some have reported being contacted by HR and told that their offers will no longer be honored. am i just next in line for a phone call, or is there chance that some IBD positions will be saved?
I spoke with two guys in my finance class today, and both have had their offers from Bear IBD revoked (this was on Thursday 4/3/08).
according to dealbook, they are keeping prime brokerage, Energy units, and merchant banking groups from Bear. I think those kids still have their offers.
http://www.facebook.com/group.php?gid=9356497161
:(
Do you think my Bear Equities SA position will be safe? My offer letter was dated April 1st and when I called HR to confirm, they said that JPM will be honoring my internship.
Are people with JPM offers safe?
Are people with JPM offers safe?
Yes, people with JPM offers are safe.
I can attest that Bear Asset Management people are saved, too.
Any word on fixed income?
Bear Stearns FT Offer to be Honored (Originally Posted: 03/18/2008)
I just heard of at least one Bear 2008 FT that will be honored. What have you heard?
What division? If it was in prime brokerage or Bear Energy that makes sense as JPM stated they want to keep that business. I am curious about fixed income and IBD.
BSC operations summer program is "on hold" and likely to be cancelled.
The individual was in the general analyst program.
what is the general analyst program?
Bear Stearns analysts are hired as generalists, then placed into groups after a rotation.
if he was IB that makes me feel a little bit better.
also...if there are other Bear T hires out there, please PM me and let me know who exactly to contact to get some sort of response. i emailed two people at HR in NYC and did not get a response.
Sad as it is to say, FT/SA offers are the last thing on BSC/JPM's minds right now. There are a LOT of rumors going around of the "he said this" and "she said that" variety but there is nothing official yet.
Yes, it sucks to not know what is going to happen but you have to keep in mind that peoples' entire lives and savings have been destroyed by this... then there's the matter of integration with JPM and what will be kept and what won't be kept.
I would start talking to some other contacts and investigating alternatives, but avoid jumping to conclusions before an official announcement is made.
i agree with you, dosk17, but the only difference between those people and individuals like myself who are apparently screwed out of an offer is experience. i spent the last 6 months thinking i have a job waiting for me, allowing other tempting opportunities to pass by. it is quite difficult right now to find a job even half as enticing as the one i already have (or rather had). this is not to say i don't feel for lower level employees who, unlike the upper echelon individuals within BS, do not have oogles of cash saved up. but such people will not have as much trouble finding a new job as will a barely experienced, graduating in less than 2 months, finance major. and even if it does take them a while to find something, most will surely have some sort of savings accumulated outside of BS stock, thus making the transition period a little bit easier. i saved as much as a college kid could, but finding a new job asap wouldn't hurt....
I've screwed up tons of times and come very close to losing all my money multiple times in my life.
If I were you I would start talking to boutiques and MMs that may still be hiring... probably the best thing to do and I would not even go after BBs as they're going to be flooded with people.
Regardless of what anyone says, a banking job at a boutique is still far better than a non-banking job anywhere else if you want to go into finance.
Protestors Infiltrate Bear Stearns Lobby (Originally Posted: 03/27/2008)
Article NEW YORK (AP) -- Some 200 protesters said Wednesday the government is bailing out Wall Street while abandoning Main Street.
The demonstrators, wearing yellow T-shirts with the Neighborhood Assistance Corporation of America logo, took their protest to the lobby of the struggling Bear Stearns (BSC, Fortune 500) investment bank.
The group's statement said the government "continues to blame homeowners facing hard financial difficulties in making payments on mortgages that were structured to fail, while using billions of taxpayer dollars" to aid the financial sector.
http://dealbook.blogs.nytimes.com/2008/03/27/protesters-infiltrate-bear…
Video
Reactions?
Its dumbasses like this that got us in the place we are in now.
"mortgages that were structured to fail". maybe you shouldn't have taken a teaser rate without knowing what that means.
I'm sure the Bear employees loved coming to work to see that, because ya know that losing your life savings by getting 10 bucks for your company's stock which was in the 100's is really a bailout.
Did anyone tell these people what would have happened had Bear not opened for business last Monday?
Mlamb, Im all about caveat emptor but you can't deny the substantial predatory lending practices that were going on at the time. Needless to say, I am a huge proponent of free market capitalism and am generally against government bailouts of any kind. Its frankly not fair to bailout people who took on an inordinate amount of risk while responsible people have to pick up the slack
WxOnWallStreet,
While I am mildly sympathetic toward Bear investors you have to acknowledge the fact that anyone who had their life savings in BSC was an idiot...its called diversification. I assume you are referring to executives who have a bit of a different story but again that is the risk that you take in a capitalist economy (easy for me to say since I don't have any skin in the game).
I agree with junkbondswap, there shouldn't have been a bailout, I don't care if the whole system would have collapsed.
Of course you don't care, because you don't understand in the least what implications this would have.
Bear is a counter-party to more than $10 trillion (with a "T") in credit swaps - bailout or not, the markets would have been in far worse shape if not for the move by JPM. The Fed's backing is really just a temporary capital backstop, not so different than that needed to unwind LTCM's precarious market positions during the late 1990's. I agree that creditors should take a hit on this, and they are, but there is a big difference between redeeming credit securities at 60-70 cents on the dollar versus redeeming them at 10 cents on the dollar. Regarding the equity, I think $0 per share is a fair price, and JPM should have taken a harder line on this front.
As for the retarded protesters, I enjoyed the following bit from a Reuters article: "Bear Stearns employees were alternatively amused and perplexed, taking pictures on their cell phones."
The Economist just ran an article on this exact topic. While I'm often critical of the Fed's actions, Bear is counter party to $10 trillion in credit default swaps. Think about the implications of that. Almost incalculable.
I think the quote was - "Bear wasn't too big to fail; it was too entangled"
Bear Stearns - 5th largest ibank (Originally Posted: 03/18/2007)
It seems like no one considers Bear as a BB, even though it's the fifth largest ibank in the US. So what makes an ibank a BB? And what's the best group within Bear IBD?
Bear is not considered a BB because its clients are regarded as "middle-market" players. Not your F500 companies, basically. That shouldn't affect how you see Bear. From what I hear, it's a great place to work, is very meritocratic, and you can take on responsibility very quickly. I don't know much about Bear beyond that.
Thanks. And from what i know, Bear IBD has TMT, healthcare, FIG, GIG and LevFin group. Can anyone offer some insight into these groups and which one's the best?
Do NOT go into Bear LevFin. I know an associate in the group, and his hours are very very bad.
When I interviewed there, I liked the people in Healthcare the best (and I understand it is a pretty good group as well), but all of my friends going to Bear seem to think TMT is the best group there.
GIG seemed like such a huge group that I wouldn't get to make any connections, or get to "know" any of my seniors. Personally, if I was working at Bear, I'd pick HC.
i had the general notion that HC has killer hours regardless of what firm you're in, is that right? if so, wouldn't they be rougher hours than LevFin?
also, during a bear interview, the interviewers said they felt that either their HC or consumer products were the strongest groups
Regarding Bear's HC group, everyone I met there seemed to be very chill, and definitely didn't seem to be as sleep deprived as the people from TMT or LevFin. I could have just caught them on a good day though.
From what I heard, regardless of the economy, you'll still have sick people, and so you'll have healthcare industry. Maybe that's why HC has killer hours?
any comments on Bear Stearns TMT in SF?
I interviewed at Bear and thought about 75% of the people I met were arrogant assholes. Might have just been the luck of the draw but it really turned me off. To be fair though, I did meet some very nice people there as well.
Bear TMT has the worst hours but does the best deals. LevFin is pretty rough on the hours as well but might have better exit opps than the coverage groups. HC can have long hours and is ok in the market. FIG and GIG have the least hours. FIG mostly works on MM deals while GIG varies a ton.
The people there are much less arrogant than at other banks from my experience. The culture is all about how hard you work. It seems like exit opps might not be quite as good as the larger banks but I would definitely not rank Bear with BofA, DB, or Jefferies. They do have many F500 clients, just not as many as larger banks.
I interviewed with people from both of the groups and really liked them. I wouldn't have described them as arrogant at all. Those are the 2 strongest groups within IBD. HC does a lot of the Pfizer deals and Merck Serono; TMT did the Disney/Pixar deal.
Bear Stearns - Is it BB or MM? (Originally Posted: 09/27/2006)
Is Bear Stearns a BB or MM bank?
most people call it a MM.
I think that it falls at the lower end of the BB, MM usually implies something like Jefferies or Houlihan
i remember reading in "The Fast Track" Bear Stearns is an up and coming bank. the book was published a while ago. what is its current status now?
lower bb, no doubt about that
Bear has chosen to focus on other areas of the bank such as prime brokerage and structured product. M&A at Bear is not too much different than at Houlihan or Jefferies, although unlike Houlihan, it has a balance sheet.
The Fast Track is correct, banking there is on the rise. Some groups do middle market deals but the bank has some very strong groups with big name clients.
what are the stronger groups at bear?
TMT and Healthcare have landed some huge deals in the past..
Is it true that Bear has the strongest TMT group on the street?
Some sources say yes, other says its GS.
thoughts?
Bear is not a bulge by any means. It is worse than BAS, DB
LOL you made my morning with that joke.
What's your deal with Bear? They've been doing pretty well for themselves recently. Size, though important, doesn't mean everything.
Within the past year, Bear's TMT Group advised Time Warner on their $1B sale of their 5% stake in AOL to Google, the $17.6B acquisition of Adelphi, the $7.5B acquisition of Turner Broadcasting, and the $1.9B sale of Six Flags. They also snagged Walt Disney as a client for its $2.6B sale of ABC Radio and it's $7.4B acquisition of Pixar.
Not bad for a bank that's a quarter the size of their competitors.
is there a website that lists the deals Bear Stearns has worked on ?
BBMandA3rdYear - Which BB do you work at? I just want to know why/what your perceptions are of Bear and if its a pretty prevalent thought across the street.
Bear blows. The only ones who disagree...work at Bear. That's the consensus among all BB's.
Like other banks. The senior people there ONLY care about money, and that trickles down to all employees. They don't focus on league tables, or size / prestige of deals. They don't care about anything except maximizing take-home pay. They often have the best paid bankers on Wall St., but they frequently lag behind in all other metrics. They just don't care about anything else. If you interview there, you should expect people to tell you that - I can't tell you how many times I heard, "we're here to get paid, not be on the front page of the Wall St. Journal" or some version of that sentiment.
^is that really true about Bear Stearns, if so it looks like BS is the bank for me.
Not sure about the IBD specifically, but Bear definitely has a dog-eat-dog perception on the street. Pretty fiesty place to work but good people from those I've met. Never heard the "we're here to get paid" line but definitely heard they are among the highest paid. There will always be a group of people that hate certain banks. Take each opinion lightly.
What will happen to Bear Stearns? (Originally Posted: 08/06/2007)
Today Co-President Warren Spector resigned. Their stock is down 27% this year. Two of their hedge funds collapsed and another is preventing investors from pulling money out of the fund. What's in the news could still be just the tip of the iceberg. Where will they be 1 year from now?
80 a share
maybe they will make a doody
funny how everyone on these boards won't discuss actual issues in depth rather, "how to get an internship," "how to get a job." Everyone leaves out "what happens at the job."
well how would ppl who are looking for a job be able to tell you what actually happens on the job?
If that says what I think it does, I think that those looking for jobs may have had jobs and can discuss them. This board is like flies on shit for interns, and they should be able to learn from it also, instead of learning how to get their next job. A good intern is knowledgeable in the field also, instead of just knowing how to work the system.
well, there's only so much an intern can pick up, but yeah they can learn somethings.
what've you learned during your internship?
In general terms I've learned about CMBS, ABS, CDOs, CMBS real estate. If you want specifics just ask.
Sure, tell me specifics.
What've you found interesting/different from what you expected?
When I came in, I had no idea what to expect. The company I am interning for is being directly affected by the mortgage blowup. They aren't losing money, but their bonds are losing value when marked to market. So they have been getting margin calls, but they have a decent amount of liquidity, 30mm in cash and a warehouse line of 200mm. They use primarily CDO financing for and that market has dried up. It is interesting that the investment pipeline for CMBS has basically come to a hault. it is also interesting that a few weeks before the blowout, we were seeing deals with pathetic DSCR's and underwriting. The underwriting was ridiculously aggressive. UW DSCR's of 1.04, underwritten aggressively. And finally it came crashing down. I think it was interesting that I noticed this and then the market crashed, which makes me wonder, if an intern can see this, then why the hell couldn't investors see it?
The acronym DSCR isn't immediately recognizable to ppl on this forum.
What do you think CDO investors should be looking for in a structure.
I guess, the first thing would be the collateral in the deal. The company I work for usually mixes CMBS, ABS, and some bank loans in the deal. Then they would figure out what kind of risk they want and invest in a tranche that is rated to their liking. My company keeps the last piece, it is preferred or unrated. The losses work there way from the bottom up. I also know the company I work for has to reinvest in the CDO during the term of the CDO, which I dont understand very well. There are certain terms that say they have to reinvest such and such at this amount. If I were an investor I would not like this much, it would be trusting the company issuing the CDO with investing in new collateral and putting it into the deal. And when market conditions go bad, like today, there will be nothing good to invest in. I guess that is why CDOs are not in demand now.
you know why they keep the equity piece?
Yes because it has the highest spread, they get the most money out of it. They feel comfortable taking the risk in it because they made the investment decisions in buying the collateral.
maybe. it's also the toughest to sell to investors so often the manager takes down the equity piece.
What business are you in?
fixed income trading
Mortgages, corporate, government? Can you tell me? A family member of mine is a bond trader at bear, hes getting fucked.
rate derivatives
are u a bsd?
that term is so 1980s
whats the new one
cmon cmon
what?
nevermind you are probably a very busy man, to deal with my mindless question
Jimbo's awesome, but don't let him off the hook.
What is the new term, Jimbo?
the just call you "Jimbo". ha.
you hear bsd sometimes, usually meant jokingly. otherwise you just here that someone is really good.
marking to market positions down is losing money...
Getting back on topic, Bear doesn't seem to hold onto much of the risk itself. It has subsidiaries and permanent strucured vehicles for that purpose funded by outside investors, like most dealers nowadays. BSAM (for instance) is a separate entity, as many already know - likely more a reputational hit than a financial one (although one can lead to the other). Transaction flow is down, however, and this will probably affect all in the dealer community, including Bear. Then again, it could be picked up on the cheap by someone with money, maybe a big bank without a deep desk.
This seems like a good question for the equity/bond analysts or bankers on this board...
Bear Stearns SA's and FT: How's the job search going? (Originally Posted: 04/08/2008)
So for all you guys out there, how's the search for new jobs/internships going?
Personally, I haven't been able to find anything in the Bay Area, all the middle markets and boutiques all pretty much finished up hiring processes.
Has anyone had any luck finding something in the past two weeks or so?
stil looking buddy. there are a few boutiques in my town, and a couple of ER shops. we'll see i guess...
I was able to sign with a Multi-Manager Hedge Fund doing quantitative research - analyzing investment strategies.
signed with Goldman Sachs.
NOT
search is shitty.
I was actually fortunate enough to secure two offers (one from a more prestigious BB and one from a top boutique) and a few other interviews the week after Bear collapsed.
1) I emailed everyone I had interviewed with and kept in touch with to see if there were any opportunities available (I told them I would be willing to work for free)
2) I emailed all my personal contacts to see if they had any personal connections within the finance industry.
3) I cold called 10-15 different regional offices a day explaining my situation....the key is to talk to people within the firm...getting transferred to HR in NY = death.
While I feel blessed and very lucky to have these opportunities, I feel that if anything, these times are a sure test of determination...don't give up and keep trying.
100% agree
Congrats man! How exactly did you manage to get the BB and top boutique offers? Same pay or are you doing it for free? PM if you don't want to post it.
Ross, no but I tell them my situation.
I got on the horn right after the Friday collapse. I however, had little luck. I touched based with everyone I'd previously interviewed with and found that at most places, positions had been filled.
I know most people on the site claim that boutiques are still hiring now. I've been lucky to find two small shops that are, but 99% of the places I've looked have thwarted my attempts with, "We do not hire interns", or "We have already hired interns for the summer".
In other words, not good - we'll see how the next couple weeks play out. It sucks because a few places I'm talking to want me to come out and interview. Not exactly easy when finals start in 7 days.
are any of you guys putting the fact that you had a Bear offer and lost it on your resume?
I don't understand why you would even consider this if you're working at a multi-manager quantitative hedge fund doing real strategic analysis--I don't know of any summer job at Bear that I would consider more prestigious than that.
How much time did they give you to think about the nonprofit offer?
Trojan - How have you already gotten your non-profit offer? HR told me that JPM is expected to get them out in the next week or so, but that they haven't done them yet because they're still working on the list of NPO's available.
gka- I'm not considering it. I've already signed at the HF. I just was wondering when JPM would be getting back to us. They are supposed to contact SA's about alternative internships (NPO's) and early recruitment for 2009 analyst positions... I was wondering if others have already heard from them, because I haven't.
Also, do you really think a HF of Funds is more prestigious than Bear/JPM? I know I'll actually get to do real work because I'm working directly with an analyst, MD, and PM, so I will be doing analyst level work. But, it isn't a brand name like Bear Stearns is/was. Thoughts?
Bear Stearns - Bear's rank among the other BBs (Originally Posted: 05/23/2007)
How does Bear rank among the BB in sales and trading? I know that they have historically been a mortgage powerhouse, but is this still the case? Where do their fixed income and/or equities operations rank among other firms on the Street?
not sure about fixed income, although i've heard good things...in equities, bear is regarded as a great stock picking shop. their research analysts are some of the best in terms of picking individual winners, so based on that, they have a strong respected sales force, and their traders are animals. This is based on things i have seen, and heard.
one of the best in s&t
Definitely still an FI powerhouse (look at revenue - if I remember right FI accounts for almost 60% at Bear). Like tekno said, excellent Equities shop as well.
skins1, what is your opinion on how the major banks rank for S&T?
Unlike IBD, where everyone seems to have their own view of "rankings", in S&T it all depends on the desk. Also, some shops, like JPM and Citi, are huge in the flow business. But the margins are lower there and the world is moving towards derivatives and structured products, so one could argue that being #1 in cash investment-grade bonds, for instance, doesn't really matter as much these days.
In general, I'd probably say that shops that are heavily focused on derivatives and structured products as their primary business are the places to be. So I'd say Goldman, Deutsche, Morgan, and Lehman are very well-regarded across the board. Barclays Capital is quickly becoming very strong in a number of areas, Bear is tops in mortgages, Merrill is tops in equity derivatives, etc.
But again, it really is all desk-dependent. For instance, I'm in commodities, so I know how things stack up in my space, but if you asked me what shop is best for, say, rate derivatives, I wouldn't really know. And in S&T desk reputation trumps firm reputation.
But also, like others have posted before, culture of both the firm and the desk trump everything. Bear and Goldman, for instance, each have very strong cultures that tend to hold across most of their desks. If you are not a fit for that culture then do NOT go there, regardless of how good the name is.
Also, while turnover is high across all of finance, it is particularly high in S&T. That's why all these kids fighting over who is most prestigious are so ridiculour. There is not a single senior person on all of Wall Street that gives a shit about the "prestige" of a bank. They care about career opportunities in specific positions, and money. That's it.
Actually I'd say the investment bankers care about prestige lol.
Skins, what are some of the "strong cultures" you know of that exist at different BB on the Street? You mention Goldman and Bear, what are their respective cultures in S&T? Any others?
It's hard to define Goldman's culture, but it's very strong and they tend to do a good job of ensuring it exists across desks. You really have to meet a number of people from the firm. But GS's culture is definitely love it or hate it. Lots of military veterans.
Bear's culture seems to be very aggresive, with an upstart mentality. Very proud of their history and the fact that they tend to have less turnover than other firms. When I interviewed with Bear the "Why Bear?" question was huge. If you didn't have a good read on their culture and know that you were willing to cut off your left arm to join then, then they were more than willing to ding you, no matter how good your "stats" were.
Lehman--hard to characterize, but almost everyone I know there absolutely loves it. Also very proud of their lower turnover rates.
Deutsche--love to hear some feedback from people who work here, but I have heard the "sharp elbows" comments on more than one occasion.
Citi--total product of the mergers. No corporate culture whatsoever, but strong individual desk cultures. The antithesis of GS in that regard (which again, can be good or bad depending on your own personal viewpoint).
Barcap--very chill, laid back, friendly people. Very diverse and international (tons of women and "minorities" on the floor). Still some of that British feel.
MS--very intellectual, for lack of a better word. To use a consulting comparison, more of a BCG feel than a Bain feel.
JPM--no comment other than that they've been hemorrhaging people for a few years now, in multiple areas.
First piece of advice--visit as many trading floors as possible. By the time I did my summer internship I had physically visited almost all of the 12 major banks. Second--meet people the individual desks, because each will have their own culture (even if you go to a firm with an overriding firmwide culture, the individual desks will still vary greatly).
sticky?
I heard Bear is rough to work at, especially since some think its 2nd tier. Would you consider it 2nd tier or all that bad to work for??
i heard very independant cut-throat culture.
to further skins' point, i'd wager the rates desk at citi for example is more similar to the rates desk at say JPM, than it does with the high yield desk at citi.
They are definitely still the mortgage powerhouse of Wall Street. Industry leaders!
Awesome thread to revive
This is hilarious!
Bear Stearns Funds blown up (Originally Posted: 07/17/2007)
Look out below...
So you're saying that nine cents on the dollar is a poor return?
At least it wasn't eight cents - that would have been embarassing. (Actually, I think the nine cents is for Bear's less levered fund, I believe the smaller fund with higher leverage is basically worth nil at this point)
Dealbreaker has rumors of 2 more HF meltdowns...anyone have any clue?
Link: Whispers Of Meltdowns from Credit Derivatives And Natural Gas
doesn't realize is that these "losses" are determined by the mark-to-market NAV of the fund's subprime securities. In a panicked, illiquid market, idiosyncratic debt is obviously going to trade far below par.
If held to maturity, on a CF basis, BS's assets are worth much, much more.
Well - that's the whole problem isn't it? When these get marked down, these funds that are levered up the wazoo have to post margin they don't have, get deleveraged, are forced to sell to cover these calls - and so the cycle continues. And when you mark-to-market, and the market knows you're a forced seller, it gets ugly.
These will be the next wave of "distressed" securities. It's no different from forced sellers of distressed bonds. You even see funds now ramping up to BUY some of these securitizations.
This is a leverage issue more than a subprime one. There's no way these funds even come close to collapsing if they are unlevered.
"idiosyncratic debt" is always illiquid, and usually marked to model.
Kind of like when LTCM blew up, Buffet was one of the top buyers of their products, which ended up making a profit.
Wasn't Buffett on some camping trip with Bill Gates and missed out on this opportunity? Back in '98 when this happened they didn't have cell phones or satellite phones way out in the middle of nowhere Alaska and he missed out I am pretty sure.
I do know that last year when Amaranth blew up, Citadel and a few ibanks bought up the remaining securities and made a shitload of money off it.
I'm joining an ABS CDO Structuring group ... interesting time to be joining, eh?
sure, maybe you'll get good experience.
locke07, at a BB or what?
is that they make it seem like BSAM is actually a PART of Bear Stearns when in reality, they are SEPARATE entities. I don't think some people realize this. Bear Stearns itself is not in trouble.
Cervantes, glad you made the statement. This is something a lot of people don't understand. I currently intern at blank Asset Management. Are we affiliated with the parent bank? Yes, but we are a separate entity. If we blow up will the parent bank be affected? Yes, but more in the sense of reputation than actual dollars (although pissed off clients I'm sure would do everything they could to spread their hatred and hurt business in other areas).
it's entirerly a reputation issue.
Do you guys know what you're talking about?
Again, the actual fund losses are from investors, but fees are pushed up to the parent company, which they lose when the HFs collapse.
Look at the BSC 2006 annual report. Asset Management is all over it. Numbers are broken out all over, as well as this:
"The (Parent) Company receives advisory fees for investment management. In addition, the Company receives performance incentive fees for managing certain funds."
Think these funds are hiring?
no
HoyaOnBothSides, I think what we were getting at was that in the big picture, Bear won't be affected in terms of earnings. I believe Bear even issued a statement saying the blow ups won't affect earnings. Similar to the hedge fund I work at, we are a separate entity, but there is still fees and expenses shared (back office people for example). But I am going to share with Cervantes in saying that's about as far as I can discuss this stuff on an open board.
The bank's balance sheet might not have taken a big hit but its reputation did. I thought the bank was paying out over 3 billion to the fund and that the stock took a pretty decent hit that day.
The stock didn't take near the hit the other banks did. Lehman lost twice as much as Bear did, yet Bear was the company whose hedge funds blew up. So really things could have been worse.
The funds may seeded with the manager's own cash, and the manager may still have substantial funds invested in their own fund.
I don't know about Bear Sterns' funds in particular.
Bear Stearns - Plenty of posts comparing banks (Originally Posted: 02/01/2008)
I know there have been plenty of posts about comparing banks, etc..but I just wanted to hear people's thoughts /opinions regarding the current situation with Bear Stearns' IBD. Their mortgage division has been eliminated and they've written down billions of dollars, yet many of the bankers are very optimistic about the investment banking business at the firm. Please comment on the above. Thanks.
the mortgage division has not been eliminated, not sure where you heard that. they finished #2 in mbs origination behind lehman this year. mortgages are a huge piece of what bear does, highly unlikely they exit the business
what about regarding their investment banking business?
writedowns(from wikipedia):
Citi: $24.1B ML: 22.5 UBS: 18.7 MS: 10.3 BofA: 5.2 DB: 3.1 Wach: 3.0 JPM: 2.9 BS: 2.6 LEH: 2.1 GS: 1.5
Yes, they lost some in writedowns, just like every other bank. However they've advised on some good deals this past year and don't think IBD has been as affected by the downturn as some of their other divisions.
Bottom line is if you get the opportunity to work there and have nothing better/nothing you like more, you should take it.
How's the exit op at Bear (say at M&A or Media) compared to at Credit Suisse and UBS? (assume same ranking in the analyst class) My impression is they are on a similar level, yet there's a gap in prestige and size.
BS will always have a second rate investment bank. Cutting back on structured finance will not give them more focus on investment banking. Bear can't compare to CS or UBS when it comes to exit ops, especially UBS or CS LA. Since Bear got burned on LBO bridge loans and CDO structuring you can expect them to be more cautious offering financing terms in the future, which will not help them win deals. BS has always had a decent fixed income division and everything else has been weak.
If the only large bank you have is Bear then take it but otherwise look elsewhere.
The Prince of Wall Street
http://www.princeofwallstreet.com
This is actually my situation. I have a good ER SA offer (think MS, CS, Lehman) and I have this BS IB offer. I like IB job (seriously, I enjoyed my last summer at a smaller Ibank.) But I'm concerned about BS's future. See, what if BS gets worse or gets bought up. On the other hand, I may do internal transfer from ER to IB at that better firm. Another tradeoff is that ER SA may hurt my FT job hunting for IB (depending on the market). Any suggestions? Thx.
If you want to do IBD, take BS IBD. Good buddy of mine summered at BS and leveraged up for FT at MS. BS IBD will go much much further than ER anywhere.
VeniVidiVici - Definitely do IB. You will have a better shot at FT recruiting the next year (in IB), but make sure you get an offer.
Bear Stearns....legitimate concern? (Originally Posted: 02/10/2008)
I realize this topic has been debated to death, but I'd like to present my situation and just hear what you guys have to say.
I received two offers, one from Cowen & Co. and the other from Bear Stearns. If this were a year ago, I'd have gone with Bear no question. Now, the decision is a little more difficult. I liked the people at both (maybe more so at Cowen), but I realize that because of Cowen's more specified focus (HC, Tech, upstart company types), I may end up with less options down the road than I could with Bear.
All of that said, my biggest concern with Bear is that something could happen between now and this summer that would prevent me from even having a position as a SA. Also, I'm concerned that Bear will hire fewer candidates out of their SA class due to the weakened economy.
If anyone could help me out here and just give me their opinion, I'd greatly appreciate it. I've tried to talk to as many people as possible, but coming from a non-target, I've had a difficult time getting very strong opinions.
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