Facebook's banks reportedly make $100M 'stabilizing' stock
Bloomberg reports that Morgan Stanley and the other underwriters made a bundle trading the stock to keep it from sinking.
The fast money always seems to come out ahead.
According to a Bloomberg report, the Wall Street banks that arranged Facebook's IPO made gains of about $100 million "stabilizing" the stock after its poor debut on the Nasdaq on Friday.
In other words, the banks -- led by Morgan Stanley -- made big profits as they traded the stock in an attempt to keep it from sinking too much. This is standard practice for a lackluster IPO, which was certainly the case with Facebook's $104 billion offering.
Bloomberg, quoting a person familiar with the matter, said that the banks will share all the proceeds. It also said that Morgan Stanley will use some of the profits to reimburse clients who lost money because of problems with their trades.