Morning Coffee: What became of the 40-something commodities traders? Bad news for Credit Suisse FICC bankers
What can you do when your income plummets or your job disappears? This is the dilemma facing commodities traders in Europe. 120 power and gas trading jobs have gone in the past year according to recruiters quoted by Bloomberg. At the same time, pay for commodities traders still in work has plummeted. In 2007, European power and gas traders were reportedly making £3m. Now they're making a mere £700k.
Disenchanted commodities traders in their late-30s and 40s are escaping to pursue their fantasy careers. "I didn't want to be the last one out," says Gilles Corre, 43, a former director of structured carbon at Tullett Prebon, who left preemptively and now drives around France selling wine. “I don’t wear a suit and tie anymore and I only need to wear shoes twice a month,” says Van der Laan, a former power trader for Nidera NV in Rotterdam, who now teaches kite surfing in the Caribbean. “We’ve got a couple of donkeys and a 33-year-old horse,” said Daken Engmann, a former energy trader at JPMorgan who's bought a farm in Ireland and wants to keep organic cows. "- These things take time to build up.”
Separately, Credit Suisse's $2.5bn of penalties for helping Americans evade taxes looks like bad news for people working in the bank's fixed income, currencies and commodities (FICC) business. The Financial Times points out that the fine has left Credit Suisse looking under-capitalized compared to all European rivals. Following the fine, Credit Suisse has a<arel="nofollow" href="https://www.ft.com/cms/s/0/d50f434e-dfe7-11e3-b709-00144feabdc0.html#slide0" target="_blank"> tier one capital ratio of just 9.3%, compared to 13.2% at UBS. This is especially bad news for the bank's capital-hungry FICC business, which is already under-performing. A 'person familiar with the bank' tells the FT that there are "more changes to come" for the fixed income business. Credit Suisse cut many of its rates traders last November. Those who remain look particularly at risk.
Meanwhile:
Brady Dougan says he has no plans to resign. (Financial Times)
Marc Booker, head of spot trading at Barclays, seems to have left the bank. (Bloomberg)
UBS has recruited 10 new managing directors in its Americas financial institutions group over the past 12 months. So far, they haven't made much difference to UBS's position on the league tables. (Financial News)
HSBC, JP Morgan and Credit Agricole have all refused to settle allegations that they fixed Euribor. (The Times)
What Lloyd Blankfein has been saying about the future of Goldman Sachs. (Quartz)
Gabriel Magee committed suicide, ruled the coroner. (Bloomberg)
Caring people wanted to work in private banks. (Bankers Umbrella)
Barclays commands male staff not to deposit bogeys on toilet walls. (Twitter)
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