What Sort of a Business is Investment Banking?

Happy Friday and welcome to another issue of Net Interest, where I distil 25 years’ experience of investing in financial companies into a weekly email. If you’re reading this but haven’t yet signed up, please join nearly 16,000 others by clicking on the link. And to my regulars: thanks for spreading the word. Subscribed Last weekend, Credit Suisse closed its books on the quarter and announced a big loss. It’s a peculiar sort of loss because it stems entirely from a single client – Archegos Capital Management. According to the bank, its dealings with Archegos “negate the very strong performance that had otherwise been achieved by our investment banking business.” In other words, performance would have been really good, befitting of the bull market, were it not for that one pesky client. Which leads to a question: what sort of a business is this? Credit Suisse has over 1.6 million individual clients, over 100,000 corporate clients and tens of thousands of institutional clients. Yet a sin

Happy Friday and welcome to another issue of Net Interest, where I distil 25 years’ experience of investing in financial companies into a weekly email. If you’re reading this but haven’t yet signed up, please join nearly 16,000 others by clicking on the link. And to my regulars: thanks for spreading the word. Subscribed Last weekend, Credit Suisse closed its books on the quarter and announced a big loss. It’s a peculiar sort of loss because it stems entirely from a single client – Archegos Capital Management. According to the bank, its dealings with Archegos “negate the very strong performance