The Multibillion-Dollar Risk Driving Big Banks Away From SPACs
- SEC rule increasing bank liability nears as SPAC losses mount
- Yet banks that walk away may also sacrifice pools of fees
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As an army of blank-check companies gathered $250 billion on their march to public stock markets over the past two years, banks handling the fundraisings earned windfalls and lavished star dealmakers with some of their firm’s largest bonuses.
But this year, many of those special-purpose acquisition vehicles, or SPACs, are struggling to seal the deals that are their reason for being -- merging with private companies. And this month, top banks including Goldman Sachs Group Inc. and Bank of America Corp. pulled back from helping them hunt for targets.