Bank Of America To Sell Prime Brokerage

Jan 16 2008 | 2:38pm ET

Wracked by plummeting profits, Bank of America announced that it will sell its prime brokerage unit, part of plan to scale back its investment banking operations and slash jobs.

Brian Moynihan, head of corporate and investment banking at BofA, said the Charlotte, N.C.-based firm’s prime brokerage’s “return attributes… are not so strong.”

BofA said it would cut 650 jobs in corporate and investment banking, but none at the prime brokerage, which has about 500 clients.

The planned prime brokerage sale is part of an overall scale-back in operations at BofA, including reductions in structured product operations.

“I see it as a reaction to the realities of today and as far as we can see in the future,” CEO Kenneth Lewis said in a press briefing.

“For some period of time, we’re going to be in a more simple world. Would you want the company to be a monolith and just not react to market conditions, or would you rather have a company nimble enough to see things would be different?”

Late last year, the struggling unit lost its global head, Christopher Pesce, and has been hit with a string of high-profile departures, including six top executives, including then-chief operating officer Glen Dailey, who joined New York-based Jefferies Group.

Last month, it was rumored talking with Citadel Investment Group about selling the prime brokerage to the hedge fund giant. Citadel denied that any such discussions had taken place.


Not So Fast: Citadel Not Buying BofA Prime Brokerage
BofA Prime Brokerage Chief Quits

In Depth

Related-Company Fees: Normal Industry Practice or Conflicted Compensation?

Nov 11 2015 | 4:23pm ET

Regulatory agencies as well as investors are increasingly exploring whether certain...


Ferrari Roars in Wall Street Debut

Oct 21 2015 | 4:28pm ET

Shares of supercar maker Ferrari jumped as much as 15 percent to a high of nearly...

Guest Contributor

Private Debt - What is the Opportunity?

Nov 11 2015 | 3:28pm ET

In this contributed article, Rob Allard, founding partner of Firebreak Capital...


Editor's Note

    Oct 21 2015 | 10:41am ET

    One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…