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Morgan Stanley Lost Over $ 900 Million From Archegos Fund Crash




MOSCOW, April 16 – PRIME. The American bank Morgan Stanley has lost more than $ 900 million due to the fact that the Archegos Capital fund was unable to fulfill its obligations on margin requirements, follows from the data of the bank’s quarterly financial statements and from statements by CNBC channel sources. In late March, a number of Archegos fund brokers, including Morgan Stanley, sold nearly $ 30 billion worth of shares in a number of companies. They were forced to do so after the fund, which had accumulated large positions in various companies, mainly through borrowed funds, defaulted on margin requirements. Analysts at JP Morgan Chase & Co. estimate that the Archegos situation could lead to cumulative bank losses of up to $ 10 billion. “The quarterly figures include $ 644 million in losses associated with a credit event for one prime broker client and $ 267 million in subsequent trading losses incurred through the end of the quarter,” the bank said in a release today. at the same time, according to a CNBC source, the client was Archegos Capital. Morgan Stanley is the largest broker for Archegos Capital. As a result, despite these losses, the bank increased its net profit and revenue in the first quarter to record levels. Earlier in April, the channel also reported that Morgan Stanley had dumped $ 5 billion of Archegos Capital the day before the massive sell-off in the stock markets. Then it was reported that Morgan Stanley sold shares to a small group of hedge funds on March 25, having received the fund’s consent. The bank offered them at a discount, telling hedge funds that they were being sold due to a margin call that could have prevented the collapse of an unnamed customer. In early April, Swiss bank Credit Suisse estimated its losses from the collapse of Archegos Capital at almost $ 5 billion.

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