That Goldman Sachs feels it must write to the Federal Accounting
Standards Board (FASB) to ask that it consider making banks mark
loans to market is telling. It's the clearest signal yet that the
pure investment banks are, finally, concerned at the potential
which lurks within the large commercial and universal banks.
The latter have been a threat for several years now, but only in
recent months has it become truly worrisome. That is, in part, due
to consolidation. Citigroup, JP Morgan Chase, Bank of America,
Deutsche Bank, even CSFB with the addition of DLJ's top-notch
leveraged finance team, now all offer a wide range of credit
products, with a balance sheet to back it up.
Another reason is that only in the past year has the extension of
credit in whatever format - loans, bonds, commercial paper -
returned to the centre stage of the investment-banking business as
a result of...
