Morning Coffee: Doctor summoned as Goldman Sachs analyst has 2.30am collapse. Good news about London bonuses
In theory, banks are reformed employers. Since the death of intern Moritz Erhardt in 2013, most have imposed limitations on junior bankers' working hours and tried to make the job of analysts less arduous. In reality, the hours in banking can still be grueling.
The very recent collapse of a junior Goldman Sachs banker at 2.30am shows just how grueling. Reuters reports that a Goldman junior came into the office despite being unwell in order to work on a live deal. At 2.30am he "broke down" and a doctor was called. Goldman is reportedly asking its staff to take their own health more seriously as a result.
It's unlikely that Goldman's entreaty will make much difference. A famous study by Alexandra Michel, an ex-investment banking associate-turned assistant professor of management and organisation at the University of California, found that young bankers abuse their bodies as they become socialized into working hard and compete against others and themselves. Extreme working goes deeper than a simple edict from the bank ordering juniors to stop. The latest case of analyst overwork also illustrates the limitations of banks' existing attempts to cut working hours: they don't apply when a deal is live and by placing restrictions on working hours at weekends they encourage longer hours midweek. Interestingly, the junior in question was based in Frankfurt: as we've said before, it's not just analysts and associates in New York and London who drive themselves into the ground.
Separately, while banks like Deutsche warn of miserable cash bonuses for managing directors this year, senior staff at U.S. investment banks in the City of London are in luck. The Financial Times points out that they could get 17% more cash this year thanks to the depreciation of sterling against the dollar. Unfortunately, bonus pools are likely to be down around 15% anyway, so at best they'll probably be flat.
Deutsche is cutting 3,400 clients from its equities sales and trading division with immediate effect. (WSJ)
Barclays is closing down the energy desk within its macro trading division and will be redeploying those resources elsewhere. (Reuters)
Members of Trump’s team are growing concerned that the administration is attracting too many Goldman Sachs alumni, but joining Trump would have advantages of Gary Cohn: he'd be able to sell his Goldman Sachs shares without a big tax bill, saving himself $12m. (Bloomberg)
Steve Schwarzman, will chair the Trump's Strategic and Policy Forum. Jamie Dimon and Laurence Fink will also sit on the panel. (Bloomberg)
Hedge fund chases individual who made a 'defamatory' comment on Dealbreaker. (Reuters)
Moore Capital Management cut the management fee on one of its core macro funds from 3% to 2.5%. (WSJ)
Head of the banking and capital markets division at PWC says some banks need to increase cost cutting targets tenfold if they want to be viable. (Financial News)
McKinsey & Co says asset managers' profits will fall by a third. (Financial Times)
Inside the Bank of England 'governor's quarters': 'an area known as the parlours, which is attended by doormen in pink tailcoats and top hats;' where Mervyn King coolly dispatched Bob Diamond as CEO of Barclays. (The Times)
Italy has had 63 governments in 70 years. (Quartz)
Oxford graduate sues the university because he didn't get a first sixteen years ago. (Guardian)