Monday, November 29, 1999

Goldman most exposed to regulatory reforms - Citigroup

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Reuters - The proposed U.S. financial reforms will hurt Goldman Sachs Group the most, followed by Morgan Stanley , J.P. Morgan Chase and Bank of America, analysts at Citigroup said.The Volcker rule and the over-the-counter derivatives rules are expected to take the biggest toll on profits of these banks, Citigroup analysts said in a note to clients.The Volcker rule proposes a ban on proprietary trading by bank-owned units and potentially requires divesting private equity and hedge fund businesses.The OTC rules seek to redirect the $615 trillion OTC derivatives market to a centralized clearing house, and even require banks to spin off their swaps-trading units.However, most of the impact on profits have already been factored into the stocks and finality of regulatory reforms should be a modest positive catalyst for the sector, the analysts said.American Express Co, Bank of New York Mellon, BB&T Corp Comerica Inc and New York Community Bancorp will be the least impacted by the reforms, they added.(Reporting by Anurag Kotoky in Bangalore; Editing by Gopakumar Warrier)
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