The Bank of England and the Federal Reserve have intensified scrutiny of banks' exposure to large trading firms and market makers following losses at Jane Street, the Financial Times reported Monday, citing people familiar with the matter.
According to the report, regulators are questioning global banks on exposures to firms such as Jane Street and Citadel Securities, focusing on risk appetite, intraday exposure changes and risk controls.
The scrutiny follows Jane Street's reported $15 billion July loss as the AI rally reversed, including multibillion-dollar losses tied to Situational Awareness, the report added.
The Bank of England and the Federal Reserve didn't immediately reply to requests for comment from MT Newswires.
(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)
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