Friday's Headlines: SEC-Goldman Deal Takes Some Risk Off the Table
Goldman Settlement `Victory' Ushers Change to Wall Street [Bloomberg News]
Terms for settling the SEC civil fraud lawsuit over a sub-prime CDO deal are better for Goldman Sachs than most observers had expected. The deal sets the stage for a new industry standard for disclosures in private sales of securities, even to sophisticated institutional investors.
Congress Passes Financial Reform Bill [Washington Post]
The most direct and immediate career impact of the massive bill is within the government itself. The Treasury Department, for instance, "has already assigned dozens of employees to carry out various provisions, such as the creation of the consumer protection bureau," the Post reports. And a new Federal Insurance Office will be set up "almost immediately."
The law creates a blizzard of work for multiple regulators with wide discretion and calls for numerous studies to help craft regulations needed to implement it, notes FT blogger Clive Crook.
Bank of America's Chief Sounds Cautious Note [NY Times]
CEO Brian Moynihan says BofA will continue to focus on risk management, and has already reduced VAR and its exposure to Europe and sovereign debt.. From a career standpoint, that appears positive for risk managers, but could be negative for traders.
Citigroup Net Income Falls 38 Percent, Beating Analysts' Estimates [Bloomberg News]
Similar to JPMorgan and Bank of America, Citi beat earnings estimates but posted sharp declines in revenue. Fixed-income trading revenue sank 31 percent from the first quarter, stock trading revenue tumbled 46 percent and investment banking slid 36 percent.
After Crisis, Show of Power From JPMorgan [NY Times]
The Times published its interview with JPMorgan's CEO on Wednesday, perhaps as a curtain-raiser to yesterday's earnings report.
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