Morgan Stanley has bought Deutsche Bank’s bulk commodities trading book dealing in coal, iron ore and freight forward contracts to expand in commodities derivatives, a source familiar with the matter said on Thursday.

Reuters reports that the deal marks an apparent return to iron ore for the Wall Street firm, which exited the market last year, and an expansion into coal and freight.

The acquisition will broaden Morgan Stanley’s customer base, making it the counterparty for structured transactions with a wide range of end-users.

Expansion of its derivatives presence comes at a critical time for the bank, whose physical business has drawn intense scrutiny from U.S. regulators and politicians concerned about the involvement of Wall Street banks in physical commodity markets.

The size of the book is not known, although Deutsche was one of the pioneers of iron ore swaps trading in 2008.

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Morgan Stanley buys Deutsche’s bulk commodities trading book

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