JPMorgan Chase has closed its global proprietary trading desk, a division wracked by departures to Citadel Investment Group. The desk took center stage in September after JPMorgan cut off counterparty trading for a day, accusing the hedge fund of poaching its employees.
The bank announced the closure last week, redistributing the desk’s 75 employees to other parts of the bank. JPMorgan vigorously denied that the move had anything to do with the departure of employees to Citadel, a notion disputed by banking analyst Dick Bove.
“The reason is that apparently Citadel has pirated so many employees out of this division that it made sense to close it and pass along its functions to other trading operations within the company,” he wrote in a note to investors.
Some of the desk’s employees are likely to be laid off, with others transferred to commodities, fixed-income, equities, foreign exchange and emerging markets duties.