Morning Coffee: Outrage as MDs in IBD forced to do HUGE amount of work. Quants warn on AI riches

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Client-facing investment bankers better dust off their passports and invest in a travel neck pillow. If other banks follow in the footsteps of UBS, they’ll be on the road more often than they’ll be in the office or at home.

Investment bank chief Andrea Orcel has reportedly put out an eyebrow-raising mandate for his managing directors: you must attend roughly 250 face-to-face client meetings every year, according to Bloomberg. For those in M&A and underwriting who are responsible for specific countries, that number increases to 300. As a point of reference, there are 251 total working days in the U.S. in 2018. In Europe, that number is even smaller.

Bankers at the Swiss firm are up in arms because they’re being faced with a directive, not some sort of opaque goal. UBS is closely monitoring the number of client meetings each MD attends and is sending pointed emails to those who are falling short. The mandate is bad news for UBS investment bankers twice over. First and foremost, it’s a lot more work and travel. But the move also hints of a bit of desperation from Orcel, who has taken a knife to the investment bank on more than one occasion. This appears to be more than just an inspirational ploy.

However, UBS isn’t the first firm to force its investment bankers to punch a clock. Two years ago, HSBC implemented a controversial system that tracks how bankers use their time and how often they are visiting clients. Could we have a trend on our hands?

Elsewhere, the New York Times published an article detailing the absurdly lofty salaries taken home by top artificial intelligence (AI) experts. One made nearly $2 million in 2016 while another earned $800k despite starting the job in March. With hedge funds and banks competing with the likes of Google, Facebook and Amazon for top AI talent, these salary totals are only likely to rise. Up to a point.

Responding to the piece, one quantitative portfolio manager in Hong Kong meticulously details the history of quants and how their hidden end goal is to eventually eliminate the need for their own position. It’s happened before, and it will happen again. In about a decade, automation will turn would-be AI rock stars back into coders.

“A small group of elite AI practitioners will have made it to managerial or ownership status while the remaining are stuck in average paid jobs tasked with monitoring and maintaining their creations,” he wrote.


Barclays CEO Jes Staley will keep his job. UK regulators are being highly criticized after only fining Staley for his attempt to unmask a whistleblower (Bloomberg)

A London investment banker was captured on video tackling a car thief in only his underwear and pinning him until police arrived. Stephen Canny, a former amateur rugby player who appears to work at Volcap Trading Partners, is enjoying all the attention from his peers on LinkedIn. (Telegraph)

Wells Fargo’s $1 billion fine includes an order that will allow regulators to fire executives or board members without any involvement from the bank. (Bloomberg)

Senior bond traders averaged $1.3 million in compensation for 2017, up 21%. Still, roughly three-quarters think they were underpaid. (NY Post)

Deutsche Bank’s recent performance has some calling for the German lender to cut its trading business completely (Handelsblatt Global)

Nomura is planning on launching a CLO business in Europe. (Global Capital)

Hermes Investment Management just gave its CEO a 22% pay raise despite the fund’s history of rebuking high salaries of management at companies in which it invests. (The Times)

A former UBS employee is suing the Swiss bank for reportedly age discrimination. His lawyer is looking to create a class-action lawsuit. (Financial Advisor)

What’s the worst part about tech interviews? A new trend where companies are forcing applicants to prove their skills through days of “unpaid homework.” (Quartz)

Lloyd Blankfein wants to be in Cirque du Soleil. Steve Cohen wants to be a ballerina. (Bloomberg)

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