Robinhood draws down credit lines with banks over WallStreetBets drama

Robinhood has reportedly drawn down credit lines with banks to the tune of 'several hundred million dollars' reports Bloomberg.

@anthony256
Published Thu, Jan 28 2021 4:16 PM CST   |   Updated Thu, Jan 28 2021 5:05 PM CST

Well, well, well -- that was faster than I thought.

Robinhood Markets -- the trading app that is in the headlines right now, has reportedly drawn credit lines with banks to the tune of "at least several hundred million dollars" reports one of Bloomberg's sources. Robinhood lenders include companies like JPMorgan Chase & Co. and Goldman Sachs Group Inc.

Robinhood draws down credit lines with banks over WallStreetBets drama 13 | TweakTown.com

Bloomberg adds that the "behind-the-scenes rush to bolster Robinhood's finances adds to signs that recent market havoc is putting a strain on the company". Robinhood explained in a blog post on its website today: "As a brokerage firm, we have many financial requirements, including SEC net capital obligations and clearinghouse deposits".

Robinhood added: "Some of these requirements fluctuate based on volatility in the markets and can be substantial in the current environment. These requirements exist to protect investors and the market and we take our responsibilities to comply with them seriously, including through the measures we have taken today".

I don't think this is the end for Robinhood just yet, with a full business day left things could get crazier. The weekend we should see it cool down, but come Monday things are going to be interesting. Robinhood has got a few days to try an un-wrangle itself, but how do you do it at this point?

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NEWS SOURCE:bloomberg.com

Anthony is a long time PC enthusiast with a passion of hate for games built around consoles. FPS gaming since the pre-Quake days, where you were insulted if you used a mouse to aim, he has been addicted to gaming and hardware ever since. Working in IT retail for 10 years gave him great experience with custom-built PCs. His addiction to GPU tech is unwavering.

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