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U.S. Bankers Are Walloping European Rivals in M&A War

U.S. investment banks have crushed their European rivals in 2013. When it comes to mergers & acquisitions, the divide is even more prominent – and it’s growing.

For the first time since 2005, not one European bank ranks in the top five positions in the global M&A revenue rankings, according to Dealogic. All five banks – Goldman Sachs, Morgan Stanley, JP Morgan, Bank of America Merrill Lynch and Citigroup – are based in the U.S.

There are two main factors at play. One: the American market is much healthier. U.S.-targeted M&A for the first six months of 2012 was $506 billion, up roughly 30% from the same period in 2012. Europe-targeted M&A, meanwhile, reached just $330 billion for the first half of the year, the lowest total since 2009, according to Financial News. The second quarter was particularly slow in Europe.

So yes, European banks are faced with a tougher chore than U.S. rivals. But that doesn’t tell the full story. In the first five months of the year, American-based banks took more investment banking fees from U.K. clients than hometown British banks, earning a 38.2% market share in the U.K., the highest since 2009. Local banks, meanwhile, owned just a 27% share of U.K. investment banking revenue during that period.

American bankers are winning at home and on the road.

IRS: Hedge Fund Hid Profit (Bloomberg)

You could call his strategy tax averse. James H. Simons, who became a billionaire by transferring his mathematical mastery from defense work to investing, is under fire from the IRS after reportedly trying to convert profit from his Renaissance Technologies’ Medallion fund’s rapid trading into long-term capital gains.

What Jobs Are Paying Bank? (eFinancialCareers)

They may not be glam and gregarious like i-banks and trading floors, but back office jobs are entering the forefront when it comes to pay. Try regulation and compliance or internal audit if you’re seeking ongoing earning potential.

Lower Pay and Offshoring (eFinancialCareers)

Last Friday, Tom King and Eric Bommensath, co-chief executives of Barclays Corporate and Investment Bank, made their first presentation concerning the future of Barclays’ investment bank. Here are the ten key takeaways.

Guilty Plea (WSJ)

As expected, former KPMG partner Scott London pleaded guilty to securities fraud on Monday for accepting cash and gifts in return for inside information on KPMG clients. He faces up to 20 years in prison.

Why Do I Want to Cry All the Time? (Mergers & Acquisitions)

Do you keep working or do you go to business school? Here’s a brutally honest argument against the latter.

Taking the Fifth (Bloomberg)

SAC Capital founder Steven Cohen has declined to testify before a grand jury investigating insider trading allegations surrounding the firm. Meanwhile, half of SAC’s 14-member investor-relations team has left the firm.

Collusion (WSJ)

Thirteen of the world’s largest bank colluded to prevent credit derivatives trading from moving to regulated exchanges, where profits tend to be lower, according to European Union authorities. The EU could fine the firms up to 10% of their annual revenue.

BofA Cuts (Charlotte Observer)

Bank of America has cut dozens of jobs across multiple lines of business within its Charlotte region. No word yet on who was affected.

Buzz Around the Office

A Humble Professor (Gawker)

The City University of New York is paying disgraced former General David Petraeus $200,000 to teach a course on public policy. It meets three hours a week.

List of the Day: Must-Ask Interview Questions

One of the key aspects of a good interview is asking pertinent questions that can help you control the conversation. Here are three important ones.

  1. What types of people are most successful in this role?
  2. What are the key short-term and long-terms goals?
  3. Any question that suggests you’ve done research.

(Source: AOL Jobs)

AUTHORBeecher Tuttle US Editor

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