Banks Said to Weigh Suspending Dealings With SAC as Charges Loom (Bloomberg)
Deutsche Bank AG and Goldman Sachs Group Inc. are among firms weighing the reputational and financial consequences of continuing to provide trading, lending and prime brokerage services to SAC, one of Wall Street’s largest trading clients, said the people, who asked for anonymity because the talks aren’t public. Prosecutors plan to charge SAC, the hedge fund founded by Steven A. Cohen, as soon as today as part of a probe of insider trading, a person familiar with the matter said. … The banks face a conundrum, either being seen as abandoning a long-term client or assisting a firm targeted for prosecution. At the same time, the companies are seeking to ensure that loans and trading agreements are properly collateralized in case SAC is forced to close, one of the people said.
Credit Suisse Posts $1 Billion Profit (DealBook)
Credit Suisse, one of Switzerland’s largest banks, said on Thursday that profit in the second quarter rose by a third, thanks to higher earnings at its investment banking operation. Profit rose to 1.04 billion Swiss francs ($1 billion) in the three months ended June 30, from 788 million francs in the period a year earlier. That compares with a forecast of 1.017 billion francs by a group of analysts polled by Thomson Reuters. … “Our business model is performing well and we continue to make progress in reducing our cost base and balance sheet,” Mr. Dougan said in a statement.
Lazard Profit Beats Estimates on Asset Management, Merger Advice (Bloomberg)
Lazard Ltd., the biggest independent merger-advisory firm, said second-quarter profit rose 81 percent, beating analysts’ estimates as revenue from asset management and merger advice increased. Earnings rose to $60 million, or 45 cents a share, from $33 million, or 25 cents, a year earlier, the Hamilton, Bermuda-based firm said today in a statement. The average estimate of 11 analysts surveyed by Bloomberg was for per-share earnings of 33 cents.
How much is Fed aid to U.S. corporate profits worth? (Reuters)
“People underestimate the extent to which quantitative easing has benefited the S&P,” said Robbert van Batenburg, director of market strategy at brokerage Newedge USA LLC in New York. He called the effect akin to “an athlete on steroids.” The Fed’s effect on corporate earnings is difficult to quantify. Van Batenburg estimates that corporate savings on interest expense after rates fell to historic lows has accounted for about 47 percent of S&P 500 earnings growth since 2009.
Fraternities Lobby for Tax Break Without Hazing Penalties (Bloomberg)
About 40 percent of U.S. senators, and 25 percent of U.S. representatives, belonged to fraternities or sororities in college. On April 24, more than a dozen of these grateful alumni extolled Greek life at an annual $500-a-plate dinner in a Washington hotel ballroom for “FratPAC,” the industry’s political arm.
One by one, they took the podium and praised fraternities for teaching them loyalty, leadership, and practical skills. “We learned to tap a keg,” declared Representative Steven Palazzo, a Mississippi Republican and Sigma Chi brother, who then yelled a cheer as hundreds of FratPAC donors applauded.
Merrill bias suit: Women employees claim they were given book urging them to ‘stroke men’s egos’ to advance (NYP)
Female trainees at Merrill Lynch’s flagship Manhattan office were given copies of “Seducing the Boys Club: Uncensored Tactics From a Woman at the Top” by their boss — who also ordered them to attend a talk with the author, three former employees claim in a bias lawsuit. The author encourages women “to stroke men’s egos with flattery and manipulation in order to succeed in a male-dominated environment such as Merrill Lynch,” the suit states. … They were also pressured to attend gals-only events on topics like “dressing for success” and “preparing healthy meals while working full-time.”
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