Dark pools might never recover from accusations at Barclays

Tim Wallace
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BANKS’ private trading platforms for clients have taken a serious knock since Barclays was accused in the US of misleading customers, analysts warned yesterday.

The British bank is fighting the accusations made by New York Attorney General Eric Schneiderman, but its trading volumes have not recovered.

Analysts at Bernstein Research fear the damage might be permanent – Barclays’ market share in the sector has fallen from 10.7 per cent to 3.6 per cent. And overall share trading volumes on dark pools are down 24 per cent.

“This clearly shows a loss of investor confidence in these platforms,” said Bernstein’s Chirantan Barua.

“These are still early stages but it throws up the whole question around whether confidence will ever come back or if these platforms are sunk cost for the banks now.”

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