Bear Stearns purchase triggers prime brokerage concerns
The near-collapse of stricken US securities firm Bear Stearns has raised questions about the strength of prime brokerages and highlighted the importance of using more than one prime broker.
The dealer revealed a significant deterioration in its liquidity position on March 14, triggering a liquidity injection from the Federal Reserve Bank of New York and a bid for the firm by JP Morgan two days later for just $2 a share, valuing the firm at $236 million. This bid was increased on March 23 to $10
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