Dresdner will not be just a spectator
Tuesday 27 June 1995
The Germans, flexing their muscles by declaring they would write off pounds 500m of goodwill for Kleinwort out of petty cash, were at pains to avoid the impression of a heavy-handed takeover. In today's edgy City, guarantees of management continuity and security of employment mark a significant change. Kleinwort is being told by Dresdner to take the group's investment banking ball and run with it on the international field, with added resources to bolster their joint ambitions.
But to infer that Dresdner will be content with the role of spectator investor would be a grave misreading. This is a significant move for a bank with a cautious tradition. What Dresdner is doing is setting in motion a global investment banking ambition, begining with a powerful European base centred on Kleinwort in the City. Building up in New York and Tokyo will come later. In virtually every field, except that of dealing in American securities in the US itself, Dresdner appears to be bracing itself, with Kleinwort, to take on the behemoths of Wall street.
However alluring the fit of this particular deal may be, it does not alter the fact that Dresdner/Kleinwort will be fighting for elbow room in a pack of equally powerful other hopefuls, as well as some mighty incumbents too. The passage of medium-sized City investment houses into the hands of well-capitalised banks is doing nothing to improve the arithmetics of overcapacity in a tight market. They merely boost the amount of capital chasing a quite limited number of business opportunities. The Continental influx into the investment banking business will turn to a flood, once the Glass-Steagall act, keeping apart commercial banking from the securities business in the US, is breached, as appears likely to happen soon.
Kleinwort and Dresdner appear to have a lot going for them. If the deal comes off, they and Deutsche/Morgan Grenfell will undoubtedly be among the investment banks to watch in the City. But reality dictates that they cannot all succeed. For many, today's bold pronouncements presage tomorrow's tearful reproaches.
Oscar Pistorius trial: Paralympian sick again after photographs of Reeva Steenkamp's body are shown in court
Arrest made after man is found by the side of the road with his penis cut off
Malaysia flight MH370: Pitbull song lyrics bear uncanny resemblance to missing plane mystery, according to YouTubers
Missing Malaysia Airlines Flight MH370: Focus shifts west as Indian Ocean becomes latest search area for the aircraft and its passengers
Jeremy Paxman reopens war of words with Michael Gove over the WW1 centenary: 'A charlatan' who scores 'cheap political points'
Katie Hopkins continues campaign to become Britain's most hated talking head with poorly timed Bob Crow tweet
No EU referendum under Labour: Ed Miliband to reveal that vote on membership is ‘unlikely’ in next Parliament if party wins power
Grace Dent: Who cares if she spells it Barraco Barner? Gemma Worrall is more employable than some bookish arts graduate
Europeans have ‘got whiter’ due to natural selection in past 5,000 years, scientists say
Fracking is turning the US into a bigger oil producer than Saudi Arabia
How climate change helped Genghis Khan: Scientists believe a sudden period of warmer weather allowed the Mongols to invade with such success
- 1 Arrest made after man is found by the side of the road with his penis cut off
- 2 Girl found in the Amazon rainforest with neighbour Grover Morales after going missing for 7 months
- 3 Tim Berners-Lee on creating the web: 'I never expected all these cats'
- 4 Malaysia flight MH370: Pitbull song lyrics bear uncanny resemblance to missing plane mystery, according to YouTubers
- 5 First Kiss viral video was just a clothing advert starring actors
iJobs Money & Business
£32000 - £36000 per annum + generous benefits: Pro-Recruitment Group: * TAX * ...
£37000 - £40000 per annum + £20000 benefits package: Pro-Recruitment Group: **...
£55000 - £70000 per annum + benefits: Pro-Recruitment Group: In-House Corporat...
£80000 - £100000 per annum + benefits: Pro-Recruitment Group: In-House Opportu...