This is a pretty stunning line to read:
“We need a merger partner or we’re not going to make it,” Mr. Mack told Mr. Pandit, according to two people briefed on the talks. Mr. Pandit, a former senior investment banker at Morgan Stanley, said Citigroup was not interested.
What might Mack have had on his mind? Afterall, only the other day he was supposedly telling MS employees that everything was just fine, notwithstanding the destructive antics of rumour-mongering short sellers.
We’re hearing everything is not just fine. Dealbreaker notes that MS prime brokerage clients are heading for the hills.
We’ve heard a few tentative numbers - with outflows of prime brokerage business from MS of between $20bn and $120bn being rumoured.
JPM is thought to have taken on board $40bn of prime brokerage accounts in the past 48 hours alone. They have been “inundated”.
It’s very much a run on the bank. The collapse of key prime brokerage accounts is exactly what nailed the lid shut on Bear’s coffin even as its executives were bemoaning the share price collapse and touting its strong liquidity position.
Little wonder then that MS is in talks with a number of parties.
