Big earnings drop at Jefferies quantifies the impact of rising rates and war

Cue the sad trombone sound.

Quarterly earnings fell in half at Jefferies Financial Group, the first financial institution to quantify the impact of rising interest rates and war in Europe.

Equity-underwriting revenue dropped by two-thirds for the quarter ending Feb. 28. Investment returns sank by 82%, reflecting steep drops in the value of tech startups.

All the market turmoil led to a 51% drop in Jefferies’ pretax income, to $327 million, and a 30% fall in net revenues. Another key measure of profitability, annualized return on adjusted tangible equity, fell in half, to 16%.

The good news came from the firm’s investor relations team, which succeeded in

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