Every year since the crisis, one of Wall Street’s top executives tells the world to quit it with all the banker-bashing. And every year, like clockwork, they get publicly roasted for their comments. UBS chief executive Sergio Ermotti needed just a few weeks into 2014 to earn his place on the mantle.
Speaking at the World Economic Forum in Davos, Switzerland, Ermotti said that all the vitriol aimed at the industry is counter-productive to moving beyond years of scandal. "Life is hard enough, and I think this constant lecturing on ethics and on integrity by many stakeholders is probably the most frustrating part of the equation,” he told the Wall Street Journal. "We are far from being perfect…but it's not going to be very helpful to be constantly bashing banks."
Ermotti then boldly stepped beyond banking as an industry and talked specifically about what he feels is an unfair standard being held against UBS. “When I look around, I don't think there are many banks that can come to us and say they are the example that should be followed,” he said.
Bold indeed. Others before him – namely Jamie Dimon and Bob Diamond – took heat for calling out critics of banking, but others fell short of isolating “stakeholders” and pointing to the faults of other firms. Ermotti seems to be calling out friends and foes alike.
The backlash, at least from those who cover banking, has been swift, and rather sarcastic. “Cue the tiny violins” was the lede in MarketWatch. “Sniff. Sniff,” said the Consumerist.
Whether he’s right or not – and he may be – Ermotti is stepping out on a shaky limb. You may remember Bob Diamond’s infamous words, uttered a year before Libor: "There was a period of remorse and apology for banks. That period needs to be over." Diamond heard those words on playback during the aftermath of the rate-fixing scandal.
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Waiting Around (Financial News)
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Winston Opening U.S. Shop (FIN Alternatives)
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Employment Suit Settled (WSJ)
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H. Frederick Krimendahl II, who spent more than three decades as a Goldman Sachs exec, died last week. Krimendahl had a range of duties over the years, including finding the firm’s London office. He was 85.
Front-Running Probe (Reuters)
Bank of America is being investigated for potentially illegal trading practices. Investigators are looking into whether swaps traders were front-running their own trades ahead of executing other large orders for clients.
Buzz Around the Office
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Quote of the Day: “If you precluded yourself from hiring any kid that was affiliated with somebody or whose parent was an important official or important industrialist or executive, you wouldn’t have very many people left.” – Goldman Sachs CEO Lloyd Blankfein, commenting on potential conflicts of interest in hiring.