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Mega-banks regain control of bond trading

The giant Wall Street banks are tightening their control of the profitable bond trading market, Bloomberg reported January 20.

The boutique bond trading firms that sprang up when the financial crisis weakened the mega-banks are losing ground to the giants, according to Bloomberg.

The article mentions trading in credit default swaps but does not mention the repurchase market.

From the article:

The percentage of trading controlled by the top 10 dealers climbed to 92.5 percent from 87.5 percent in 2008, according to a survey published in August by Greenwich Associates, a research and advisory firm in Greenwich, Connecticut, specializing in financial services. The share for smaller dealers outside the top 10 increased to 7.2 percent from 4.9 percent.  …

The 18 primary U.S. government debt dealers that trade directly with the central bank held $88.2 billion of corporate debt with maturities greater than one year as of Jan. 12, up from $59.8 billion on April 29, 2009, the least since 2003, Fed data show.

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