BrokerDealer Profits Up 30 Percent; Sell The News?

Posted on October 8, 2015 by admin

Wall Street broker-dealers posted profits of $11.3 billion in the first half of 2015, up nearly 30 percent (for metric mavens, the more accurate number is 29 percent) year-on-year and the strongest first half since 2011, according to a report by a New York financial watchdog on Tuesday–and published by Financial Advisor Magazine

However, the report by New York state Comptroller Thomas DiNapoli said a slowing global economy could put pressure on the industry in the remainder of the year.

As published by FA Mag, “After a very strong first half of the year, the securities industry faces volatile financial markets and an unsteady global economy,” DiNapoli said in the report.

The report said a recent return to jobs growth in the industry could be undermined in the remainder of the year. The industry added 2,300 jobs in 2014, the first year of jobs gains since 2011, a trend which accelerated over the first eight months of 2015, the report found.

The industry had been “on pace to add more than 4,500 jobs in 2015 before recent concerns over weakness in the global economy roiled the financial markets,” it noted.

The yearly report aggregates tax data from the broker-dealer operations of New York Stock Exchange member firms. Those operations have been profitable for the six years since the financial crisis in 2008, according to the report.

This BrokerDealer Gives Back and Helps Lead The Way

Posted on October 6, 2015 by admin

army ranger lead the way fund marketsmuse update

BrokerDealer.com blog update is honored to re-play the news update profiling minority brokerdealer Mischler Financial’s mission to support Army Ranger Lead The Way Fund, the non-profit dedicated to supporting the families of US Army Rangers killed in the line of duty and service-disabled Rangers and their families in need of financial support that is not made available by the federal government.

(r) Mischler Fixed Income Trader Glen Capelo (c) Duke University Coach K” Krzyzewski (r) Mischler CEO Dean Chamberlain

Oct 5 2015–Stamford, CT and Newport Beach CA–Mischler Financial Group, Inc., the financial industry’s oldest and largest institutional brokerage and investment bank owned and operated by Service-Disabled Veterans is pleased to have served as a Silver Sponsor for the 2015 Army Ranger Lead The Way Fund Gala. Silver Sponsors contributed a minimum of $25,000; proceeds to Lead The Way are dedicated to support service-disabled US Army Rangers and the families of Rangers who have died, have been injured or currently serving in harm’s way around the world.

This year’s annual gala took place September 30 at New York’s Chelsea Piers and NBC News Anchor Tom Brokaw served as Master of Ceremonies. The 2015 Lead The Way event paid tribute to 5-time NCAA champion and college basketball legend Mike “Coach K” Krzyzewski, a US Military Academy at West Point Graduate (USMA ’69) and a former classmate of Mischler’s Founder and Chairman Walt Mischler. Coach K served two tours of duty prior to his career as a world famous university basketball coach.

Mischler Financial’s VP of Capital Markets Robert MacLean (USMA ’02), who served seven years as a US Army Ranger and is a two-time recipient of the Bronze Star, served as a member of this year’s Lead The Way Fund Host Committee. MacLean shared that honor with a short list of military veterans who have since forged a path on Wall Street at firms that include among others, Goldman Sachs, JPMorgan, UBS, Credit Suisse, Barclays, and Fortress Investment Group.

After Coach K retired as a Captain in the US Army, he then served five years as Head Coach for the USMA before accepting the role of Head Basketball Coach for Duke University’s Blue Devils in 1980. During the past 35 years, Coach K has not only led his team to five NCAA champions, he has dedicated the past nearly four decades to contributing his thought leadership to an assortment of national and local philanthropic initiatives.

Stated Mischler Financial Group CEO Dean Chamberlain, also an alumnus of the USMA (’85) who served two tours of duty prior to injuries sustained in the line of duty, “In addition to personal contributions on the part of our firm’s leaders, Mischler provides year-round support to a select group of military veteran and SDV-focused philanthropies and we are particularly honored and proud to continue our ongoing support of Lead The Way, one of the most impactful organizations dedicated to providing assistance to military veterans and their families.”

Veteran-Owned BDs Lead CalVet $446 Mil GO Bond Deal

Posted on October 5, 2015 by admin

BrokerDealer.com blog is honored to profile the select Veteran-owned FINRA firms and their respective roles in helping the State of California Department of Veterans Affairs bring to market CalVet’s upcoming issuance of $446 Million General Obligation Bonds (GO).

The following news release has been excerpted, a link to the full news release follows below..

Treasurer Chiang to Sell $446 Million in Veterans General Obligation Bonds

10/1/2015

SACRAMENTO – California State Treasurer John Chiang is announcing the sale of up to $445,700,000 of Veterans General Obligation Bonds.

“California’s Veterans served our state and nation with honor,” Chiang said. “We owe them a debt of gratitude that this bond sale will begin repaying by way of helping our returning service members and their families realize the American dream of homeownership.”

The General Obligation Bonds are being issued to finance home and farm mortgage loans for California military Veterans under the Farm and Home Purchase Program, administered by the California Department of Veterans Affairs (CalVet).

“This is an important bond sale directly aiding California’s Veterans,” said CalVet Secretary Vito Imbasciani, M.D. “I’m proud California offers these bonds as an expression of our thanks to our Veterans and their families for their service and sacrifice. This General Obligation Bond sale will provide CalVet with funding sufficient to offer home loans to hundreds of California’s Veterans.”

The joint senior managers include: Bank of America Merrill Lynch, which currently employs more than 10,000 Veterans, Guards and Reservists with a major initiative to increase the hiring over the next several years and Academy Securities, a “post 9/11 DVBE broker-dealer” founded by a U.S. Naval Academy at Annapolis graduate. Along with these two firms, the underwriting group will also include investment bank Mischler Financial Group, led by battle-decorated West Point grads and the financial industry’s oldest institutional brokerdealer owned and operated by service-disabled veterans, and Drexel Hamilton, LLC, a full-service institutional broker-dealer that “offers meaningful employment opportunities to disabled veterans in the financial services industry.:

“Bank of America has proudly provided financial services to the U.S. Military for 95 years. With our long history and ongoing commitment to U.S. veterans, we were pleased to be involved in this deal, working with veteran-owned firms in a deal that will benefit former Californian service men and women,” said John Lawlor, head of Municipal Banking & Markets Group at Bank of America Merrill Lynch, himself a former U.S. Navy veteran, and graduate of the U.S Naval Academy.

“As the financial industry’s oldest and largest SDV-owned and operated firm and rooted in California, our legacy is dedicated to supporting Veteran initiatives. We are therefore honored to continue our long relationship with the State and to have been selected Co-Senior Manager for this CalVet financing,” said Dean Chamberlain, CEO of Mischler Financial Group.

For the full story, please click here

Minority BrokerDealer: Corporate Bond Market Balancing on Knife Edge

Posted on October 3, 2015 by admin

BrokerDealer.com blog update offers weekend reading courtesy of MarketsMuse Fixed Income Department..

“Corporate Bond Market- Balancing on a Knife Edge” is courtesy of extract from the 10.02.15 weekend edition of “Quigley’s Corner”, a daily synopsis of the investment grade corporate bond market and rates trading space authored by Ron Quigley, Managing Director of investment bank and institutional brokerage Mischler Financial Group, the financial industry’s oldest and largest minority brokerdealer owned and operated by service-disabled military veterans. Mischler Financial was selected in 2014 and again in 2015 for the Wall Street Letter Award “Best Research-Brokerdealer”

Ron Quigley, Mgn.Dir. Mischler Financial Group

Blackouts couldn’t be more optimally timed as we experience massive re-pricing in our IG primary credit market. The corporate black-outs are serving as an unplanned, well-timed inherently built-in “kick-the-can” that is necessary in helping us to all buy time as we navigate thru what is perhaps the most unpredictable, treacherous, volatile and uncertain time that our primary markets have experienced since 2008. As one very senior syndicate source told me “the credit markets are sitting on a knife’s edge.” IG spreads are on the whole 44 bps wider at the end of the third quarter according to Morgan Stanley.

Today’s notoriously and unexpected poor employment data was the last thing credit markets needed and it has instigated a massive Treasury rally. Perhaps this is a bit of good news because when both are combined, is a potential high velocity tailwind to credit products from big government bond funds. However, that’s “if” funds want to own credit product and hold it for an extended period of time and potentially wear a negative mark-to-market.

Having said that, the guy-in-the-corner suggests that at some point this weekend, you should put on your favorite song and sing along to it after many shots of tequila. When you get to the point of feeling bad, look at yourself in a mirror and realize that you can begin to feel better with coffee, food, sleep and time but come Monday morning the business model you are used to is about to change. Not adapt; not get better; rather change. The trends in the credit markets that we have seen over the last two quarters are showing no signs of abating, and in some degrees, worsening.

Now please let me introduce the moment you’ve been waiting for..

Syndicate Forecasts and Sound Bites from “The Best and the Brightest!”

I am happy to report that once again the “QC” received unanimous participation from all 23 syndicate desks surveyed in today’s Best & Brightest polling. That includes all of the top 22 ranked syndicate desks according to Bloomberg’s U.S. IG U.S. Investment Grade Corporate Bond underwriting league table that can be found on your terminals at “LEAG” + [GO] after which you select #201 (US Investment Grade Corporates). Their cumulative underwriting percentage is 94.00% of YTD IG dollar debt underwriting which simply means they’re the ones with visibility. But it’s not only about their volume forecasts, rather it’s also about their comments! This core syndicate group does it best; they know best; so they’re the ones you WANT and NEED to hear from.

*Please note that these are Investment Grade Corporates only. They do not include SSA issuance unless otherwise noted.

The question posed to the “Best and the Brightest” early this morning was:

“Good morning! So, this week the massive repricing in primary markets saw average NICs bust out to 54.23 bps; bid-to-covers shrank to an average 2.02x; today’s numbers were BAD; Obamanomics is quite the engine of growth and job creation, China’s slowdown is showing up in our data (ISM Milwaukee posted its worst manufacturing number since the dot com bubble). Spreads are wider on today’s data to start. Lower-for-longer might just be lower forever! The two-part question for today is what are your volume forecasts for IG Corporate supply for BOTH next week AND October? It’s going to be challenging to nail that down but it’s an important survey at this critical juncture. Many thanks, Ron”

……and here are their formidable responses:

To continue reading, please visit Mischler Financial Group’s market commentary section via this link

BrokerDealer Behemoth LPL Financial Undervalued Says HF Activist

Posted on September 23, 2015 by admin

BrokerDealer.com blog update profiling activist fund manager Marcato Capital’s stake in LPL Financial, the financial industry’s behemoth collective of independent brokerdealers is courtesy of InvestmentNews.com.

An activist hedge fund investor on Tuesday afternoon said it had taken a 6.3% stake in LPL Financial Holdings Inc., sending the independent broker-dealer’s stock price higher as the rest of the market declined.

LPL’s shares are undervalued, Marcato Capital Management said in a filing with the Securities and Exchange Commission. Marcato acquired the LPL shares through various funds it controls “in the belief that the shares are undervalued and are an attractive investment.”

Marcato could enter into discussions with LPL’s board to discuss “strategic alternatives” for the company, including a potential for a merger or acquisition, according to the filing.

BrokerDealer.com hosts a global directory and database of brokerdealers in more than 35 countries worldwide.

“These discussions may review options for enhancing shareholder value through strategic alternatives or operational or management initiatives including, but not limited to, improving capital structure and/or capital allocation, M&A, asset allocation, and general corporate strategies,” the company wrote in the filing.

The company’s share price has lagged since it reached a peak of $55.37 in March 2014. Its recent low was $37.72. The stock surged almost 4% after the Marcato filing with the SEC; in early afternoon trading in New York, LPL shares were trading around $41.80. The S&P 500 was down about 1.6% on Tuesday.

ONGOING DIALOG

“LPL Financial maintains an active and ongoing dialogue with its investors and values their input as we work toward the common goal of driving stockholder value,” an LPL spokesman, Brett Weinberg, said in an email.

When asked specifically about a potential merger for LPL, Mr. Weinberg declined to comment.

With close to 14,000 affiliated registered reps and investment advisers, LPL has had growing pains over the past few years. LPL has been in the spotlight recently due to its host of problems with the Financial Industry Regulatory Authority Inc., (FINRA) as well as state regulators. Two products that have caused LPL to pay fines or restitution to clients have been nontraded real estate investment trusts, a popular alternative investment, and variable annuities.

CEO Mark Casady said over the summer that LPL was near the finish line with fines and settlements stemming from securities regulators’ actions.

Alex Kramm, an analyst for UBS who follows LPL, said investment firms such as Marcato focus on why companies are undervalued.

For the entire story from InvestmentNews.com, please click here