Investment bank Jefferies Group LLC swung to a quarterly loss, hurt by a $164 million charge related to changes to the U.S. tax code.
Jefferies, like many U.S. banks, had to make large one-time adjustments to account for the new tax code, but lower corporate tax rates are expected to boost future profits.
Jefferies said investment banking revenue rose 7.8 percent year-over-year to $440 million in the first quarter ended Feb. 28, while revenue from its asset management business dropped 38.2 percent to $4.9 million.
Total non-interest expenses rose 4 percent to $699 million.
Jefferies reported a net loss of $60.8 million, compared with a profit of $114 million a year earlier. Excluding the tax-related charge, Jefferies would have reported net earnings of $103 million.
Net revenue rose 3.2 percent to $821.2 million.
New York-based Jefferies, a unit of Leucadia National Corp, traditionally kicks off the earnings reporting season for investment banks. Its results are viewed as an indicator of big Wall Street banks’ performance.
Most U.S. banks are scheduled to report first-quarter earnings next month.