Europe recently held its bonds sales, and the only US bank allowed to appear was Morgan Stanley, JP Morgan and Goldman Sachs were excluded from the lucrative offerings worth hundreds of billions of euros
European Governments angry over what they see as a banking system that puts profits above the stability of the banking system itself no longer have the confidence that the excessive risk-taking culture of the big Wall Street banks has changed and they still cannot be trusted.
Arlene McCarthy, vice chair of the European parliament’s economic and monetary affairs committee stated “It is no surprise therefore that governments are reluctant to do business with banks that have failed to learn the lesson of the crisis. The banks need to acknowledge the mistakes that were made and behave in an ethical way to regain the trust and confidence of European governments”
European sovereign bond league tables are now dominated by European banks such as Barclays Capital, Deutsche Bank, and Société Générale, the Dealogic table shows. Their business model is usually seen as more relationship-based, while US investment banks have traditionally been focused on immediate deal-making.
Being left out of the government bond sales means missing out on one of the highest fee-earning opportunities of the year, especially given the density of the drought in mergers and acquisitions and in the stock market flotation’s!
Western European governments need to raise an estimated half a trillion dollars this year to refinance debts and pay for bank bailouts and rising unemployment.
Banks typically take a percentage of the total deal value for underwriting a bond issue, which could run into tens of millions given the ballooning sovereign debt sales this year. On a 1% fee, Barclays Capital would have pocketed $92m (£61m) from the $9.2bn European bonds it helped sell.
But the European governments have turned their back on Americas too big to fail, with a sharp criticism for the management and direction our banks have taken and the apparent assent from the white house.

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