Hedge funds moved billions of dollars out of their prime
brokerage accounts at both Morgan Stanley and Goldman Sachs
this week, as the financial crisis on Wall Street deepened
following the bankruptcy of Lehman Brothers and the Federal
Reserve's virtual takeover of AIG.
Just months ago, both firms benefited from a flight to
quality when Bear Stearns was forced into the arms of JPMorgan,
which had relatively little prime brokerage business before
Bear's operation was folded into it. Now, "everybody's trying
to go to JPMorgan," said one investor, reflecting the
heightened stature JPMorgan has gained through the crisis.
Credit Suisse and Deutsche Bank are picking up a lot of
business as well, as are universal banks such...