Morning Coffee: Deutsche Bank's M&A bankers have been living the high life. Out of control management at Credit Suisse
When John Cryan came to Deutsche Bank, he tried hard to crackdown on extravagance. Journalists from Handelsblatt shadowed him in 2015 and depicted a man with a battered briefcase on a mission to discourage entitled spending among his staff. Three years later, he's trying still: in last week's investor call, Cryan said "aggressive" cost management is the priority for 2018. This being the case, an (alleged) slide of an internal Deutsche Bank presentation obtained by Dealbreaker, might be cause for concern.
Shown below, it suggests that some of Deutsche's bankers in EMEA are still big spenders. Part of a presentation that Dealbreaker claims was made by Alasdair Warren, the head of Deutsche's corporate and investment bank in EMEA (of whom more later), the slide presumably applies to Deutsche's M&A and capital markets bankers in particular. It says that expenses rose 40% over the past year to €22m, explicitly forbids the use of limousines (as if this needs to be stated), and implies that Deutsche bankers have been using company travel as an opportunity for taking weekend breaks.
Most damningly, though, the slide suggests that some individual Deutsche staff have single-handedly racked up car-related costs of £30k ($42k) annually. That's impressive and suggests Deutsche's bankers have been availing themselves of the full suite of limos, drivers, and cars with leather seats and darkened windows. Dealbreaker goes on to suggest that a round of layoffs is coming very soon to Deutsche and that Warren himself may leave - although this is purely rumour and has not been confirmed with DB itself.
Separately, Credit Suisse seems to have decided that it has too many managers in its Swiss wealth management business. The bank has reportedly decided to cut managers on the basis that it wants one executive to every seven employees. Currently the ratio is one to every 4.2.
Meanwhile:
Deutsche Bank is moving back into CDS trading after hiring Paul Huchro from Goldman Sachs. (Bloomberg)
Credit Suisse has got an AI powered chatbot on its support team. (Finextra)
Richard Evans, head of equities sales and trading at Barclays in Europe, is thinking of leaving the bank. (Financial News)
Dirk Young, a compliance professional responsible for monitoring Barclays' most senior staff, has left for Jupiter Asset Management. (Financial News)
Every year, before his birthday, Morgan Stanley CEO James Gorman puts himself through an annual fitness test. "It’s a rowing test: 10 500-meter sprints, each under 2 minutes, with a 1-minute interval. I’ve now done this for about six years since I started rowing on the ergometer, and it’s like an annual mark-to-market of how you’re aging." (Bloomberg)
UBS wants to double its wealth management staff in Edinburgh to 30 people. (InvestmentWeek)
U.S. asset managers are hiring in analysts with very specialized knowledge often gained away from the buy-side. (Reuters)
There's no Plan B if the City of London doesn't manage to negotiate a post-Brexit trade agreement. (Politico)
Dame Helena Morrissey, the asset management CEO, had a miscarriage at work. “I want to share the reality and encourage women to recognise that everyone has challenges; the key is to have a supportive environment and to be resilient and adaptable but not aim to be superhuman. ” (Financial News)
Men with high testosterone are less into classical music and opera. (BPS Digest)
I tell my graduate students and post-docs that if they’re working 60 hours per week, they’re working less than the full professors, and less than their peers. https://t.co/mapWtvmBWp
— Nicholas A. Christakis (@NAChristakis) February 4, 2018
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