9 percent of revenue at Credit Suisse, 4

Liquidity would hold up if bank prop desks chopped

government prohibits banks from proprietary trading, leaving trading activity, exchanges and interdealer brokers unhurt in the long run.

Concerns about the impact uk canada goose outlet of proposals by President Barack Obama knocked share canada goose black friday sale prices on Friday for the London Stock Exchange, Deutsche Boerse and interdealer brokers ICAP and Canada Goose Online Tullett canada goose clearance Prebon.

Analysts cited uncertainty about regulation and trading volumes as the reason for the drop, but market players said the buy canada goose jacket cheap rule would not impair market liquidity.

I think it will lead to less activity in the financial markets? No, said Rob Kitchin, senior managing director at interdealer broker BGC.

will lead to Canada Goose online different people doing it.

Quantifying the amount of bank proprietary trading is not easy. One technical problem canada goose factory sale is defining exactly Canada Goose Jackets what is proprietary trading, versus trading on canada goose uk outlet behalf of clients.

Banks take risk canada goose uk black friday on their books routinely when they act as dealers, although they aim to cheap canada goose uk balance trades Canada Goose Coats On Sale to end up with a minimum net exposure to risk at the end of the trading day.

But the proposal appears to be aimed at bank trading desks that are specifically designated to take hedge fund style risk.

President words clearly imply that market making will be exempt, UK based analysts for canada goose coats on sale Bank of America Merrill Lynch wrote in a note on ICAP.

Prop trading accounts for 4.9 percent of revenue at Credit Suisse, 4.3 percent at Deutsche Bank, 4.2 percent canada goose coats at Barclays, canada goose 3.1 percent at Societe Generale and 1.4 percent at BNP Paribas, UBS analysts estimated.

Even buy canada goose jacket while bank shares fell on Friday, critics said their quality https://www.canadagoosejacketsalesca.co.uk of earnings could improve if the volatile and potentially loss making segment was removed.

of the gains from taking these risks went to uk canada goose the staff rather than shareholders, so I suspect long term shareholders will actually be grateful, said Helvea analyst Peter Thorne.

Keith Skeoch, chief executive of Standard Life Investments, one of the biggest UK investors, said: support the principle of reducing the ability of proprietary Canada Goose Outlet desks canada goose uk shop to engage in speculative trading particularly during capital raisings.

LIQUIDITY EMERGES ELSEWHERE BGC Kitchin said Obama and his economic advisers aimed to change cheap Canada Goose the way banks operate, not to stop proprietary trading from taking place at all.

it will end up that the banks split into two parts: a deposit taking and retail canada goose store side that plays it safe and a prop Canada Goose Parka bank that does not have taxpayer backing, he said.

More hedge funds or other proprietary risk takers also could emerge to take their place.

For the interdealer brokers, the client base might fragment, which could be good for their business, Bank of America Merrill Lynch analysts said in the ICAP note.

banks are prevented from prop trading, we would canada goose ca presume that risk capital will be provided canada goose clearance sale in other areas, they said.

As for the exchanges, the analysts estimated that about 20 percent of trading flow at canadian goose jacket Eurex comes from proprietary trading, and less than half of that figure comes Canada Goose sale from banks.

The majority is from large investors who are direct members of the derivatives exchange.

If a big player pulls out, other investors spot opportunity and jump in to fill the gap, said an executive at a multilateral trading facility (MTF) who did not want to be identified.

Additional reporting by Steve Slater and Raji Menon in London and Martin De Sa’Pinto in Zurich; Editing by Rupert Winchester.