Hedge funds face higher prime broker charges under Basel III

Funds urged to build treasury savvy as prime brokers retrench

Jon Yalmokas, Bank of America Merrill Lynch

For months now, prime brokers have been warning that tougher rules on bank capital and liquidity will force them to charge more for financing and cut the amount of leverage they provide to clients. Few hedge funds are listening though, and it is not hard to see why. Despite the dire predictions, the cost of financing has barely budged for most of them.

"Lately, we've heard a lot of ‘sky is falling' talk from prime brokers, but when you really get down to it and ask them if they want you to move