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Jefferies Faces $17M Loss on Lending Blowups
26 Mar
Summary
- Jefferies reported $17 million in losses from two major lending collapses.
- Losses stemmed from auto-parts supplier First Brands and UK mortgage company Market Financial Solutions.
- The bank's shares saw a slight increase in post-market trading.
Jefferies Financial Group has revealed $17 million in pre-tax losses stemming from the failures of two significant private lenders: auto-parts supplier First Brands and U.K. mortgage company Market Financial Solutions. The firm's exposure to First Brands has now been reduced to zero following a new $10 million loss, in addition to a previously disclosed $30 million loss.
These disclosures come as investors grow increasingly concerned about the broader private-lending sector, citing potential fraud and exposure to AI-disrupted software companies. Many investors have recently exited private debt funds.
Despite the setbacks, Jefferies reported growth in its first-quarter revenue and profit compared to the previous year. Executives attributed these gains to market-share expansion and robust activity in merger-and-acquisition and equity markets.
