Saturday, 20 September 2014
Last updated 1 day ago
May 21 2010 | 12:24pm ET
A snafu at the Securities and Exchange Commission has offered an unexpected look at Citadel Investment Group’s nascent investment banking operations.
According to the earnings statement, Citadel Securities took in $1.01 billion in revenue last year, turning an $81.6 million profit. Most of the unit’s revenue came from its original market-making business, which was established in 2001. Investment-banking operations accounted for just $5.4 million in revenue, compared to $621.6 million from principal transactions and $300.4 million from clearance income.
The regulator mistakenly posted Citadel Securities’ earnings statement on its Web site, despite Citadel’s request that it be kept confidential, according to Bloomberg News. The earnings statement has since been removed, although the public version of the filing, without the earnings statement, remains.
The earnings statement, which was required for SEC review, also shows that Citadel chief Kenneth Griffin used $60 million from a non-hedge-fund affiliate to reimburse Citadel Securities for some I-banking costs. That reimbursement was included in the $81.6 million profit; without it, Citadel Securities would have reported an anemic 1.9% return on equity. Compensation and benefits at the unit ate up $274.3 million.
The reimbursement included pay for new hires. There have certainly been a lot of those recently, with several top executives both joining and leaving the firm within the last 18 months.
The SEC filing did not include 2008 numbers for comparison.
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.