Goldman managed to sell most of the stock related to its Archegos margin calls on Friday, helping the firm avoid any losses in the episode, according to one of the people. Morgan Stanley sold $15 billion in shares over a few days, avoiding significant losses, CNBC’s Leslie Picker reported. Investors punished the two non-U.S. banks. Nomura ended Monday down 14%, while Credit Suisse slid 11.5% when the market closed. Meanwhile, Morgan Stanley dropped 2.6% and Goldman shares dipped a modest 0.5%.
Besides not acting quickly enough to stave off losses — Nomura and Credit Suisse each indicated that they were still unwinding positions as of Monday – the two firms may not have been as disciplined with Hwang’s fund as their big American rivals, according to industry observers. Nomura estimated that as of Friday’s market prices, the firm faced a $2 billion loss, while Credit Suisse said that the shortfall could be “highly significant and material” to the bank’s first quarter results. Calls to Credit Suisse and Nomura weren’t immediately returned. Morgan Stanley, Goldman and JPMorgan Chase are the biggest prime brokers in the world, according to sources who track the industry’s revenue. Credit Suisse is ranked seventh, while Nomura is outside the top ten.