ICAP Said to Shut Four-Person NYSE Unit After Polcari Quits
ICAP Plc (IAP), the world’s largest broker of transactions between banks, is shutting its four-person New York Stock Exchange floor trading unit, according to two people with direct knowledge of the matter.
The company took the action after its highest-profile NYSE trader, Kenneth Polcari, resigned to pursue other interests last month, said one of the people, who asked not to be identified because the decision hasn’t been made public. Guy Taylor, a company spokesman, declined to comment.
ICAP’s action comes in a year in which average U.S. equities volume has fallen 19 percent from 2011 to about 6.5 billion shares a day, the lowest since at least 2009, according to data compiled by Bloomberg. The company maintains an U.S. equity trading operation with about 20 people in Jersey City, New Jersey, that won’t be affected by the closure, one of the people said.
The shutdown was reported earlier by the Financial Times.
Europe’s sovereign-debt crisis is forcing ICAP to cut costs to bolster profit as transactions on its foreign-exchange and fixed-income trading platforms slip. The company expects to make more than 50 million pounds ($79 million) of reductions by the end of this financial year.
The London-based firm reported a 26 percent decline in profit yesterday as transactions in markets spanning stocks, bonds, currency and derivatives slumped.
“This has been one of the toughest periods in my 36-year career in the wholesale financial markets,” Chief Executive Officer Michael Spencer said yesterday when the earnings were released. “I do not believe this negative environment will continue indefinitely, but equally I do not expect it to improve imminently.”
ICAP shares fell 9.2 percent to 281.40 pence in London yesterday. Full-year profit will be at the “low end” of the 300 million-pound to 332 million-pound range of analyst estimates, the company said on Nov. 14.
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