Crisis-fearing bankers hiring execs who ‘look like’ them: Krawcheck
In times of crisis, people tend to reach out to those who are closest to them. That’s exactly what’s happened on Wall Street over the last five years, as male bankers have looked to hire more within their own gender following the 2008 credit crunch, according to former Bank of America and Citigroup exec Sallie Krawcheck.
Speaking on Bloomberg TV, Krawcheck said we haven’t gone sideways in the battle for gender equality, “we’ve gone backwards.” Part of the issue has been the sour economic environment, which has convinced executives to ignore the benefits of workplace diversity and instead hire people who “look like” them, she said.
“What I saw when I was on Wall Street, it’s not, ‘Let’s get rid of people who are different than us because they’ve got cooties,’” Krawcheck said. Rather, male executives are feeling the pinch of the current banking landscape and reaching for people who they deem trustworthy, particularly for prominent roles. More often than not, those people are men, she suggested.
Speaking broadly, the gender mix on Wall Street has improved, but not at the upper echelon. Large banks count zero chief executives who are women and only a select number of C-level employees. It’s typically a 70/30 split when looking a new classes of managing directors.
Statistically speaking, women were also more likely to be let go during the mass layoffs that occurred post-crisis. Financial services and insurance firms cut roughly 260,000 jobs in the 18 months following the crash. Seventy-two percent were women, despite the fact that females made up 64% of all financial services employees.
Krawcheck herself was let go from Bank of America in 2011 during a restructuring effort. She offered some pretty interesting notes on how to avoid the same fate after one breaks through the glass ceiling.
In the five years following the financial crisis, bankers have heard it all. They’ve been called crooks, cheats and much, much worse. Now, they’re being compared to a bunch of apes. Captive rhesus macaque monkeys, actually.
French bank SocGen beat fourth quarter expectations on the back of strong performances from its equities trading unit and its commercial bank. However, deputy CEO Severin Cabannes reiterated the bank’s pledge to concentrate hiring in fixed income – particularly in the U.S. – despite a near-40% dip in FICC revenue during Q4.
A total of 10 managing directors have left Goldman Sachs in the last two months. Many have moved to the buy-side. A report surfaced this week that bonuses for Goldman MDs dropped by as much as 30%.
Two of the most influential women in all of banking – JP Morgan's Blythe Masters and Brevan Howard’s Geraldine Sundstrom – could soon find themselves out of work.
Here’s a risky investment. Private-equity firm Najafi Cos. is pumping $100 million into disgraced celebrity chef Paula Dean’s new company.
George Canellos, the former co-chief of enforcement at the Securities and Exchange Commission, is headed back to the private sector. In fact, he’s rejoining his old firm, Milbank, Tweed, Hadley & McCloy, where he’ll be defending the same folks he once investigated.
Meet Greg Fleming, the head of Morgan Stanley's wealth and asset management businesses and a potential successor to Chief Executive James Gorman. Or maybe he isn’t. Sources say he’s may jump ship for another top job.
Buzz Around the Office
83-year-old billionaire George Soros got smacked in the head by his 30-year-old ex-girlfriend during a deposition on Tuesday. She also knocked the glasses of Soros’ lawyer and screamed at her own attorney before storming out. She seemed upset about something.
Quote of the Day: "A lot of my friends at these investment banks are going to be real mad at me for saying it, but…I think what they should do is go back to Glass-Steagall.” – Carl Icahn on Tuesday