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Morning Coffee: Thrusting Goldman Sachs banker ruins chilled HSBC party. Jes Staley's Brexit jobs reassurance

Things used to be quite relaxed over at HSBC. The British bank had a reputation for offering jobs for life, with palatable working hours and jovial colleagues. Until a man schooled in the ways of Goldman Sachs came along and changed everything.

We've already written about the maelstrom that is Matthew Westerman, the former Goldman Sachs banker who took over as head of HSBC's global banking division in May 2016. Back then it was because Westerman - who spent 15 and a half years at Goldman Sachs - was shaking things up at HSBC with a new system that tracked exactly how HSBC's senior bankers used their time, including how many clients they visited and how many deals they brought in. Gone was the 'HSBC way' of trusting senior staff to do what's right, irrespective of the consequences.

In fact, it seems that Westerman's cultural revolution extends far beyond the mere monitoring of HSBC's senior M&A staff. Reuters reports that HSBC is cutting around 100 senior investment banking staff (possibly as a result of those monitoring efforts), while Bloomberg says HSBC has implemented a "much harsher" year end review procedure and will henceforth be employing a far more differentiated distribution of its bonus pool. The pay change is designed to make HSBC's investment bank more competitive, says Bloomberg: in the past it was "more egalitarian" than its peers.

The job cuts, the harsh reviews, and the inegalitarian distribution of bonuses are reportedly all Westerman's doing. If HSBC bankers don't like it, they'll have to find new jobs elsewhere (like Canaccord Genuity, maybe). Westerman is there to say: Reuters says he's tipped by insiders to become HSBC's new CEO.

Separately, what if Brexit isn't an unmitigated disaster for London banking jobs? What if it's just a bureaucratic exercise which is easily containable with a bit of damage limitation? This seems to be the opinion of Jes Staley, CEO of Barclays. The Financial Times points out that Staley has been suggesting that Brexit is really a question of administration: "Same people, same traders, you have to book a trade in Ireland as opposed to London, but that’s not a wholesale move of our capability from London to Ireland,” he said last week.


“You need to have a broker and a bank in the UK, and a broker and a bank inside the EU. We have that already. There will be other small adjustments, but it is as simple as that.” (Financial Times) 

Representatives of Goldman Sachs, J.P. Morgan, Bank of America and UBS met the French finance minister and were a bit disappointed when he didn't speak fluent English. (Financial Times) 

In summer 2017, UBS might decide to move its London M&A bankers to Madrid. (Bloomberg)

Morgan Stanley will move 1,000 jobs in sales and trading, risk management, legal and compliance out of London. Citi will shift 100 sales and trading jobs to Dublin. (Reuters) 

HSBC may send 1,000 workers to Paris but there will still be 44,000 left. (The Times) 

Why it's a bad idea to work for an M&A boutique as a junior when the work dries up: "We still had 15 people who needed to be paid . . . who didn’t want to come to work and do nothing — they wanted to come to work to learn and do deals,”  (Financial Times)

Jamie Dimon got a $1m pay rise. (Independent) 

James Gorman got a $1.5m pay rise. (Reuters) 

Reasons to work in the rates business. (Business Insider)

"If I weren't a fund manager, I'd be an economics and history teacher." (Telegraph) 

A model to calculate your chances of getting a job in an investment bank. (Google Drive)


Photo credit: HSBC London by Håkan Dahlström is licensed under CC BY 2.0.

AUTHORSarah Butcher Global Editor

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