HSBC to hire Morgan Stanley after cutting broking ties with Goldman Sachs
Banking giant HSBC is set to hire Morgan Stanley as joint corporate brokers to replace rivals Goldman Sachs.
Europe’s largest lender has cut ties with Goldman Sachs in favour of rival US investment bank Morgan Stanley following a review by new chief financial officer Ewen Stevenson, Sky News reported.
Goldman Sachs steered Europe’s largest lender through its £12.5bn rights issue in 2009 – the biggest capital-raising in UK market history and one of the biggest capital raisings by a financial institution following the financial crisis.
HSBC has used Goldman Sachs and Credit Suisse as joint corporate brokers since 2011 but it is unclear whether the Swiss bank will also lose out following the review.
Despite losing HSBC as a client, Goldman Sachs would remain sixth among stockbrokers in the FTSE 100 with 14 clients, according to the latest Adviser Rankings data for the second quarter.
JP Morgan Cazenove regained top spot in the three months to the end of May from Bank of America Merrill Lynch (BAML) after adding Evraz and ex-BAML client Ferguson.
Morgan Stanley, which slipped below UBS into fourth place, in the second quarter would close to the gap to the Swiss bank to just one client.
Last week it emerged HSBC was gearing up to cut hundreds of jobs in its investment banking division as part of a cost cutting drive.
At least 500 people at the bank could lose their job within global banking and markets, but formal numbers have yet to be announced.
The cuts are expected to start as soon as the middle of this month.
It came after the bank reported a 31 per cent jump in pre-tax profits last month as it cut costs and its revenues in Asia grew.
It made $6.2bn (£4.9bn) in the three months to March, up on $4.8bn the previous year.
HSBC and Morgan Stanley declined to comment.