Best global flow house: Deutsche Bank
|
Also shortlisted: |
Sales and trading at the world’s biggest investment banks is facing a perfect storm. The long-term headwind is the amount of capital these firms need to hold to provide liquidity to their clients. The biggest storm of the last year has been the billions of dollars of fines handed out to many of those banks in the rates and foreign exchange markets.
Flow businesses, for so long the main driver of many investment banks’ profitability, are challenged. And if you listened to many of its competitors, the bank that faces the biggest challenge of all is Deutsche Bank. That noise intensified when the architect of its markets business, Anshu Jain, stepped down as group co-CEO in June.
But block out that noise for a moment and look at the reality of Deutsche’s flow business. With the likes of Barclays, UBS and Credit Suisse all sounding a retreat, it is the only non-US firm competing on a global scale.
“The biggest structural change for the markets is balance sheet optimization and the inability to do large risk aggregation.