Europe's leading investment banks took a trading revenue battering in the third quarter that shows no signs of reversing before the end of the year and gives a glimpse into the upheaval facing the industry as a whole.
Reuters reports that the combination of a regulatory drive to make markets less risky, a reduction in banks trading for their own account and the end of a 30-year bull market in fixed income is forcing all banks to rethink their operations and, in most cases, shrink.
Fixed income and currency desks took the biggest Q3 hits - to leave equities with a larger slice of the trading pie - as concern over a scaling back of U.S. stimulus crimped volumes, scuppering a tentative rebound seen at the start of the year.
While revenues normally take a seasonal dip in the third quarter, most of the banks also saw a drop year-on-year, as the slide was exacerbated by economic and political uncertainty.
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