MFG records Q2 loss after IPO cost bites

02 Nov 2007

MF Global (MFG) recorded a second quarter loss of $90.6m due to costs associated with its IPO this September, despite strong growth in its execution and clearing businesses.

Net revenues totalled $435.5m during Q2 surpassing the 2006 level of $323m but MFG revealed that the IPO and a provision for litigation settlement, cost the firm $144.3m. MF shares opened at $31 on 19 July having initially been slated to trade...

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“A lot of banks have spent a lot of money calculating the cheapest way to collateralise their positions, and they’ve hired some very bright mathematicians to do it. Why would they gamble all of that by using the cheapest clearing house?”

Senior rates players believe fears of a race to the bottom among clearing houses has been overstated.