Bank of America Merrill Lynch (BofA Merrill) has closed its European power and gas desk. According to a company spokesperson “the decision follows a recent review of BoA Merrill’s broader commodities activities and reflects the combined impact of lower client demand for European power and gas hedging and recent regulatory changes.”
“The bank will continue to trade coal, commodity indices, oils, metals and US power and gas from its Houston, London, New York and Singapore offices,” the spokesperson added. According to reports, the bank’s European carbon trading desk will also be reduced but will not be shut entirely.
BofA Merrill becomes the fourth major player to close parts of its commodities business as tighter regulation and fewer arbitrage opportunities erode profits.
Last month Morgan Stanley sold its main physical oil trading unit to Russia’s state-run oil group Rosneft, while Deutsche Bank announced a significant scaling down of its commodities trading operations. In July, JPMorgan said its physical trading operations were up for sale.
The sector is now dominated by commodities trading houses and utilities, with Barclays, Citi and Goldman Sachs among the few remaining major banks with a significant presence.
Cash-flow based metrics now feature prominently alongside traditional revenue measures of business performance in the key figures or financial summary pages of any public company.
GTNews asks Pugsley about what advice she would give to treasurers dealing with mergers and acquisitions, what the key challenges for her year ahead will be and how she is selecting a treasury management system (TMS).
The US money market fund reforms came into effect in 2016 and are already dramatically shaping US fund industry with investors flooding out of prime funds and into government securities. While the reforms are similar, they are not the same. GTNews interviews Yeng Bulter, global head of the cash business at State Street Global Advisors on the differences.
Tim de Knegt, strategic finance and treasury manager for the Port of Rotterdam, discusses how he is using blockchain, the challenges he will face in his role of treasury over the next 12 months and the advice he would give to someone starting out their career in treasury.