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Goldman rethinks services it provides to hedge funds: WSJ

Published on Aug 5, 2014 9:34 AM

(Reuters) - Goldman Sachs Group is jettisoning less-profitable hedge-fund clients and raising fees on others as it tries to adapt to new banking rules, the Wall Street Journal reported on Monday, citing people familiar with the matter.

The bank has told hedge fund clients the regulations have forced it to set aside more capital, crimping profits at its prime-brokerage business, which executes and finances the funds'trades, the newspaper said.

The investment bank is also pulling the firm's own cash out of its largest internal hedge fund to comply with the new regulations, the Journal reported, citing sources. Goldman Sachs was not immediately available for comment.

The move is part of an attempt by Wall Street banks to scale down from capital-intensive businesses in order to comply with stricter capital requirements by United States regulators.

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