https://www.bloomberg.com/news/articles/2021-03-29/wells-fargo-said-to-execute-four-block-trades-worth-2-billion
Any one know what kind of gsib exposure wells had to cs?
Raising $2B overnight looks....ominous.
Was that a forced trade? Margin call? Derivitives blew up?
LOL
Liquidity event?
WF has 405 billion in cash on hand.
its happened before
https://www.treasuryandrisk.com/2012/05/21/jpmorgans-risk-officer-fired-by-cantor/
Wells was party to what looks like time duration spread exotic derivitives and the bank apparently was a market maker.
The trade went the wrong way for the hedge fund and couldnt meet collateral for margin call.
It should be noted the trader had been banned in foreign markets already for bullshttery. Where is wells know your customer and why wasnt this guy flagged?
heres what happened to jp morgan when something like this happened before:
https://www.brookings.edu/research/2-billion-later-policy-implications-of-jp-morgan-chases-trading-loss/
Utlimately the bank was hauled in front of congress and grilled relentlessly for hours.
The bank paid a big fine and the losses were more than double initially reported.
Who bears the loss? The loss will be borne entirely by Morgan’s shareholders. The same will likely be true for Wells. 2b is a drop in bucket for a bank as large as wells fargo. But it will expose more poor internal oversight and make regulators unhappy.
After JP morgan formally announced trading losses the stock tanked nearly 10%.
If all this plays out like JP Morgans little incident, there will be lawsuits, sec investigations and the CIO will likely be shown the door.
Oh, and one more thing? They laid off staff who had nothing to do with the debacle.
Yay us.
Wells is trying to get out of congressional hole and regulatory scrutiny...this might be the final straw that says its time to break the bank up.
Lets all hope so.
I didn’t think our treasury mgmt team did the traditional stuff and that it was more focused on client needs and products and services for that. but timing with Trotter is curious
Assuming on that block trade they took a 50% haircut.
That would net to 1,000,000,000.
Chukkie makes 34,000,000 per year.
This comes out to 29 smirking a$$holes who cant hold a chord on an expensive guitar if their life depended on it.
Now we know why head of corporate treasury was fired on the spot.
Cuckie is trying to cut expenses while head of corporate treasury was increasing them.
How many of us will need to get cut to make up for their mistake this time?
This also means asset cap just slipped away and more regulatory scrutiny.
Smoothe move cuckie.....your salary should be cut in half.
Remember folks - one item on proxy vote is hes lobbying for a payraise. Does he deserve it?
David Trotter was head of treasury managment.
If you do not know what that is:
https://en.wikipedia.org/wiki/Treasury_management
Bad margin calls that hurt bank liquidity are his domain.
Well, guess what.....
https://www.reuters.com/article/usa-markets-blocktrades/quotes-archegos-margin-call-share-dump-ripples-across-markets-idUSL1N2LR110
That's is a material event. And my bet is this is just the tip of the iceburg. How much more sh–ty overlevered equities are they playin with????
As a reminder they just sold the student loan portfolio, likely at a loss, for a mere 750 million.
Charlie will need to fire another 20000 rank employees to cover the commercial banks f up.
This one tho cant be spun as sins of the past.
This happened on his watch, likely while he playing sour notes on his over priced guitars.
I saw that too; the media isn’t saying too much. Something doesn’t seem right...