Morning Coffee: How Many Banker Heads Will Roll?
A new competition has broken out among financial analysts and advisory firms: Who can estimate the highest number of anticipated job cuts soon to hit Wall Street?
Consulting firm Roland Berger notes that the i-banking sector may need to purge as many as 75,000 additional jobs in the next five years to counteract dwindling revenues and lower returns on equity.
Analyst Meredith Whitney, speaking on Bloomberg Television's "Bloomberg Surveillance,” later estimated that as many as 100,000 Wall Street jobs may be on the chopping block “in the foreseeable future” due to across-the-board revenue misses.
Both firms got a bit closer to hitting their targets when Bloomberg reported early Wednesday that UBS is set to cut as many as 90 junior- and senior-level positions within its European investment banking division by the end of 2012. The Swiss bank last year announced plans to cut roughly 1,600 jobs before the end of 2013, but has already reached its headcount target.
The expected cuts would only add to the carnage. The world's largest investment banks shed nearly 6% of their staff between June 2011 and June 2012, cutting headcount by roughly 10,000. Goldman Sachs, which recently reported its lowest first-half revenue in seven years, has been particularly aggressive, slicing headcount by nearly 10%, according to a Financial News report.
And Bank of America, which announced it would be trimming 30,000 jobs over five years will be cutting 16,000 jobs this year, primarily in its retail banking and mortgage units, earlier than originally planned according to the Wall Street Journal.
Wall Street veteran Haim Bodek, a former exec at Goldman Sachs and UBS, reportedly played an integral role in the launch of an investigation by the U.S. Securities and Exchange Commission into whether stock exchanges are colluding with high-speed trading firms.
David Viniar, Goldman Sachs’ longtime chief financial officer, stepped down, passing the torch to 48-year-old Harvey Schwartz, co-head of the firm’s sales and trading division. Schwartz will officially succeed Viniar on Jan. 31.
Two former Nomura traders – Borut Miklavcic and Gianluca Squassi – will launch a new hedge fund later this year dubbed LindenGrove Capital, and are reportedly in talks to bring on other former Nomura execs following the firm’s expected approval from the U.K. Financial Services Authority.
Recharging the Batteries (Financial News)
Hedge fund Sloane Robinson, which has struggled to retain assets following the 2008 financial crisis, will be without its chief investment officer, Richard Chenevix-Trench, beginning in March. Trench is taking a roughly six-month leave of absence to “recharge.”
While Goldman Sachs continues to cut staff, the firm is showing no signs of slowing development of a new European headquarters in London’s financial district.
If you are studying in the U.K. or Europe and are interested in getting into i-banking, well, don’t read the lead article above. If you’re still curious, click here and have experienced bankers and graduate recruiters review your resume and anonymously rate it alongside other entry-level i-banking resumes.
Getting out of Debt (The Telegraph)
Still tired on Monday, even after sleeping late throughout the weekend? The remedy to eradicate “sleep debt” isn’t to wake up at noon, but rather to get eight hours of sleep before your usual weekday wake-up time.
Buzz Around the Office
Actress (if that’s an accurate term) Lindsay Lohan has been arrested again, again. This time for allegedly leaving the scene of an accident after running into a man and breaking his leg with her SUV, although now the man's account is being questioned.
List of the Day: Clichés to Forget
In all walks of life there are unwritten rules that you must follow. Here are three career-related ones that you should ignore.
- Avoid talking salary in an interview.
- Appear humble and downplay your accomplishments.
- Don’t speak up. Wait your turn early in your career.
