09-15-2008, 01:49 PM
|
|
|
Confirmed User
Join Date: Aug 2001
Posts: 1,922
|
Not the only one predicting this.
Quote:
Independent Investment Banks `Won't Exist' CIBC's Nesbitt Says
By Doug Alexander
Sept. 15 (Bloomberg) -- The failure of Lehman Brothers Holdings Inc. shows that investment banks need the backing of a consumer bank to survive, said CIBC World Markets Chief Executive Officer Richard Nesbitt.
``I don't think around the world there's any place for a large investment bank unless they're part of a commercial bank,'' Nesbitt told investors at a conference in Toronto today. ``I don't think they'll exist, except for the very, very tiny investment dealers.''
In the biggest reshaping of the financial industry since the Great Depression, two of Wall Street's most storied firms, Merrill Lynch & Co. and Lehman Brothers, headed toward extinction today. Lehman filed for bankruptcy protection and Merrill Lynch was bought by Bank of America Corp., the largest consumer bank in the U.S.
``It's an actual evolution of the business,'' Nesbitt said. Investment banks will continue to shrink, and focus more on their domestic market, while trying to provide services to their consumer-banking clients, he said.
``There are a number of activities that won't make sense for banks to do anymore,'' said Nesbitt, who heads the investment- banking unit at Canada's No. 5 bank. ``The profit margin is not going to be there unless the pricing goes up or the funding costs come down.''
http://www.bloomberg.com/apps/news?p...U&refer=canada
|
|
|
|