GS Principal Funding & Investments vs. JPM Structured Credit
Most of you have probably seen the JPM presentation posted today. If you look on page 8, you'll see that they are moving away from the structured credit (credit derivatives, credit exotics, whatever you call it), going from #3 in 2009 to #8 in 2010 and 2011. I assume this is in response to the new regulations and increased capital they have to hold against these illiquid assets.
What I'm wondering is, why does GS get to keep their structured credit business and call it "lending" because the instruments are long-term and illiquid? I thought illiquid was what the regulations were trying to avoid, but apparently if you get illiquid and long-term enough, it counts as investing and lending. I must be missing something here; can any of you good folk point it out?
Before starting New York-based Prosiris in 2009, Ali headed the Americas principal funding and investments group at New York-based Goldman Sachs, where he managed “a multi-billion dollar portfolio of credit and structured finance assets and credit derivatives” from 2006 to 2009, according to an e-mailed statement.
Same goes for GS SSG - classified as a lending business. As far as PFI goes they do both funding trades and illiquid credit prop trading so they are quite versatile in that sense.
Do you have a link to the JPM presentation by any chance?
Eius perferendis est vel repellat. Ut eum soluta porro omnis. Consectetur neque accusantium nihil sit autem qui. Incidunt et quas voluptate laboriosam ullam architecto consequatur.
Saepe qui ea ullam atque labore odio debitis sit. Mollitia consectetur nemo ipsum quos esse facilis. Cumque consectetur quas dolor nesciunt. Qui id et temporibus.
Recusandae sint et dolor. Quae quo cum labore maiores. Id reprehenderit quod aut esse. Dolor ea nihil iure est dolorem. Corrupti aperiam voluptas aut.
Repudiandae ut unde sequi delectus aut. Explicabo nesciunt autem expedita asperiores.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...