MS - BOE Fed tell banks to fortify risk management to avoid another Archegos

The Federal Reserve and the Bank of England are urging large banks to carefully monitor their risks to mitigate fallout should one of their fund clients collapse, like Archegos Capital did earlier this year. To recap, in March, Archegos, the family office of Bill Hwang, imploded after its leveraged bets on small number of stocks including ViacomCBS (NASDAQ:VIAC) and Discovery (NASDAQ:DISCA) soured, leaving banks holding the bag for more than $10B in losses. Credit Suisse (NYSE:CS) took the biggest hit, incurring a $4.7B loss. Nomura (NYSE:NMR), UBS (NYSE:UBS), and Morgan Stanley (NYSE:MS) also absorbed significant losses. "Regardless of the type of client, banks are expected to undertake proper due diligence with a client and take fully into account the risks that a relationship with a client may pose to the bank," the U.S.'s central bank said in a statement. Since Archegos's collapse, the Bank of England reviewed counterparty risk management at

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BOE, Fed tell banks to fortify risk management to avoid another Archegos