U.S. Lobbyists Push U.K. Regulators To Speed Lehman Bankruptcy

Oct 15 2008 | 3:04pm ET

The main U.S. hedge fund industry group has tough words for U.K. regulators in a transatlantic lobbying effort.

The Managed Funds Association is warning the Bank of England that the Lehman Brothers bankruptcy proceedings in London, which have some $65 billion of hedge fund prime brokerage assets frozen, imperils the British prime brokerage industry as a whole. And with prime brokerage providing a big portion of British banking profits, the MFA cautions that the Lehman bankruptcy could undermine the planned bailout of British banks.

“Prime brokerage clients are already withdrawing their assets from the U.K. prime brokers/U.K. branches of overseas prime brokers,” MFA chief Richard Baker wrote, noting that hedge funds have transferred billions of prime brokerage assets to the U.S., where it is believed that the legal system provides greater protection. “This development is calling into question the future of the U.K. prime brokerage market.”

The MFA is urging the BoE to work with the U.K. Financial Services Authority and Treasury to expedite the Lehman proceedings. But the Bank said it has “no powers” to do so, and Lehman administrator PricewaterhouseCoopers says there is nothing that can speed the freeing of those assets.

Baker’s effort is backed by the Alternative Investment Management Association, the main British hedge fund lobby.


In Depth

Whisky Business: The Ultimate Liquid Alternative Investment

Sep 15 2014 | 7:02am ET

David Robertson knows his single-malt whisky—he was the Master Distiller at the...

Lifestyle

Hedgies Rock Out For Children's Charity

Sep 15 2014 | 8:40am ET

It's that time of year again—when hedgies trade in their spreadsheets for guitars...

Guest Contributor

The Cult of Loss Aversion: A Call to Rethink Risk in Global Macro Investing

Sep 4 2014 | 5:45am ET

In the wake of a traumatic loss, whether it is financial or personal, it is just...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    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…

 

Futures Magazine

July/August 2014 Cover

In search of the ‘new normal’ at the Fed

The Federal Reserve keeps baby-stepping toward a “normalization” of monetary policy. But just what is normal?

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.