Morning Coffee: Laddish traders said to leave an 'inappropriate object' on a desk, and the silver lining for Deutsche’s 23-year olds
It’s almost a whodunnit.
It is not unknown on dealing floors or in investment banking offices for groups of colleagues to go out on the town, but then to find themselves coming back to the office – possibly to pick up briefcases or coats – before heading for home. In these circumstances, if you happen to have been someone who didn’t go out with the gang, you might come in to work the next morning and find that your desk has been in some way defiled. Stacking IPO prospectuses two feet high used to be a popular one, or dropping the contents of a litter bin everywhere.
If a female employee finds a witch’s hat on her desk in the morning, though, then it might be well to check that she’s got the kind of relationship with her colleagues that ensures that any 'good natured ribbing' is taken in the spirit in which it’s intended. Because if that’s not the case and things end up at an employment tribunal (where, in the UK, damages are capped unless the worker can prove discrimination), it might prove to be an expensive laugh rather than a cheap one.
Although, from the reporting so far, it appears that there is something of a Sherlock Holmes element to this case. Stacey Macken, the prime brokerage product manager bringing this case against BNP Paribas, has made the claim that the witch’s hat was put on her desk as an intentional slight (rather than a friendly joke, or a misplacement of part of a fancy dress costume someone didn’t want to carry home), and by a group which included the overall boss of the unit. The first is inference, the second is apparently something that she “was told”, although that will presumably be the subject of cross-examination.
So far, it looks like a fairly sad story of personality clash in a business line (prime brokerage) where client entertainment has always been an important part of the franchise, and where a consequent culture of socialising has developed. According to Ms Macken’s testimony, her line manager Denis Pihan told her on her first day of employment that he hoped that hiring their first woman wouldn’t stop the laddish behaviour in the office, and then at a performance review that, “We do not believe that this is the right bank for you – what can we do about it?”. Mr Pihan apparently remembers this differently, and to be fair, both statements could have been motivated by a genuine concern for her welfare depending on the tone and context.
The case is ongoing, and will presumably come to a conclusion in the next week or so. It doesn’t look at the moment like it’s going to be an exception to the rule, “there are usually no winners at employment tribunals”; Ms Macken is claiming £4m ($5.3m) in “stigma damages” and compensation, and is currently on long term sick leave.
Elsewhere, Deutsche Bank’s bonus pool is apparently below €2bn and, anecdotally, bagels are being served with up to 20% of traders in London looking at zero bonuses for the year. It’s hard to find a bright side to something like that, but there are some suggestions that talented juniors have been protected, and the promotion period for analysts has been shortened from 2.5 years to two.
Once those analysts have graduated from the training program, they are likely to find the ranks a little more open than might otherwise have been the case. After a bonus season like this year’s, and with overhanging merger and franchise risk, senior traders and bankers are going to be asking for retention packages and leaving if they don’t get them. That will leave vacancies at the top of the pyramid, and the promotion opportunities are likely to ripple down the ranks, as Deutsche finds it increasingly more difficult to recruit from outside. Ambitious young naval officers always used to toast “a bloody war and a quick promotion”, and although few junior associates would wish the current state of affairs on their own bank, it’s a similar situation.
Board changes at Barclays, as Mike Turner leaves. This appears to be part of a decision to bring in new blood on the part of the incoming chairman, Nigel Higgins. It’s less clear if this is intended as an anti-activist strategy to protect Jes Staley from Bramson, or just housekeeping. (FT)
UBS promotion lists are going up, with 96 new MDs in the Americas, mainly in wealth management and private banking (Bloomberg)
Judges called his case a “tragedy” and found that he had not manipulated LIBOR. They said there were “troubling” aspects to the way his case was investigated. However, they upheld the regulators’ view that he had not been fully frank, first time, when they interviewed him. Now Arif Hussein is suing UBS for breach of contract. (Bloomberg)
Not a regional league table to be proud of – UBS and Citi are joint top in terms of fines levied by the Securities & Futures Commission in Hong Kong. The SFC appears to be adopting a conscious policy of getting more aggressive in terms of the amounts levied. (Finews Asia)
No longer a billionaire – after a bad year’s performance and redemptions at Greenlight Capital, David Einhorn’s personal wealth is now around $700m (Forbes)
“He knows where all the bodies are buried, largely because he buried most of them”. A profile of David Mathers, the ultimate survivor on Credit Suisse’s top management team. (Finews)
After deciding previously that it didn’t want to be so dependent on hedge funds, Goldman Sachs is now recruiting staff and cutting fees to attract more prime brokerage clients (Financial News)
The Mooch is back with the SALT Conference returning to Las Vegas after a year off. Apparently, according to Scaramucci, “if Jesus returns to Earth before May, I will try to book him as a speaker”. (Business Insider)
If, for any reason, you’re planning on having an intense conversation this week, learn the emotional control strategies from the world’s top table tennis players (BPS Research Digest)
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