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Morning Coffee: Goldman and JPMorgan bankers gave up holiday for tiny payday. Harder to get into McKinsey than Goldman Sachs

With Wall Street officially in a bear market, the travails of a few bankers who gave up their holidays for a deal that now seems unlikely to happen may seem inconsequential. After all, it's in the nature of M&A banking that this kind of thing occurs. The bankers themselves admit it: We spent Easter on it,” one disappointed participant tells the Financial Times. “That’s the life of a banker.”

"It" is Elon Musk's floundering urge to buy Twitter. If the deal goes ahead, the FT says a group of bankers at Morgan Stanley, Goldman Sachs, JPMorgan Chase, Bank of America, Barclays and Allen & Co will earn $192m in fees; Goldman's bankers alone will earn $80m and JPMorgan's will earn $53m. If the deal doesn't, Goldman bankers will only get $15m and JPMorgan's bankers will walk away with a mere $5m.

While this might simply be the risk of the game, in a year when investment banking fees have plummeted to their lowest level since 2016, Musk's money would be greatly appreciated and Easter would have been a good time to drown sorrows were it categorically not forthcoming. Instead, teams of bankers at top tier houses sacrificed holidays for the dangling promise of fees that will probably never arrive. Even if the deal goes ahead, money has already been lost. Much of Easter specifically was spent arranging $12.5bn of margin loans to help Musk finance the deal; this in itself would have generated $375m a year, but Musk decided not to use the loan facility after all. It might be said that the bankers ended up working for free...

Separately, it seems like any prestigious job these days has 100 other people going for it. There were 125 people chasing every front office job in the investment banking division at JPMorgan last year. And now it seems there are 100 people chasing every job at consulting firm McKinsey & Co.

Bob Sternfels, McKinsey's managing partner, told the Financial Times that the firm has received about one million applicants for the 10,000 jobs it offers in the past year, and that this is a record high.

Sternfel's revelation implies that it might be easier to get into Goldman Sachs than McKinsey, given that Goldman only had 66 applications for each of its internships last year. Similarly, away from the front office, JPMorgan had a mere 59 applications per internship vacancy. 

Like big banks, McKinsey is trying hard to diversify its workforce. Sternfels says that until recently it hired its 10,000 people from 500 "sources." Now it hires them from 1,000. But he'd like to hire from 10,000: every person from somewhere different. 


Goldman Sachs executed its first Ethereum non-deliverable forwards, a derivative that pays out based on the price of ether and offers institutional investors indirect exposure to the cryptocurrency. (Coindesk)

Ardea Partners, a boutique run by ex-Goldman bankers, paid its 13 London staff an average of $785k each. (Financial News) 

JPMorgan is hiring up to 50 Ukranian refugees in Warsaw. They'll join in finance, human resources and operations on a 12 month placement. (Bloomberg) 

Morgan Stanley electronic trader Grant Allen has joined Millennium. (The Trade) 

HSBC is the latest bank to have a quantum computing program, after initiating one in August last year. Steve Suarez, HSBC global head of innovation, global functions. (WSJ) 

Everyone wants to hire private markets specialists and they're getting pay rises of 20% to 40% to move. (Financial News) 

In China, Haitong International, China Merchants Bank International, and Guotai Junan International have all been cutting staff and some bond bankers have transferred to equity research teams. (Financial Times) 

Credit Suisse Group AG, Goldman Sachs Group Inc. and UBS Group have been warned not to pay their Chinese bankers too lavishly.  After hiring about 200 people in China last year, Credit Suisse now is delaying plans to form a local bank and could let go of dozens. (Bloomberg) 

Deutsche Bank is hiring people to work with family offices. It recruited more than 15 private banking executives for a family office unit since the start of 2021 and now wants relationship managers in London and Switzerland with family office expertise. (Bloomberg) 

Pagliara’s unit has already hired more than 15 private-banking executives since the start of 2021 from rivals including Credit Suisse Group AG, Barclays Plc and UBS Group AG to build up Deutsche Bank’s wealth-management operations worldwide. He’s now seeking to find relationship managers in London and Switzerland with expertise on family offices. (Bloomberg) 

How to talk to the CEO of an investment bank: Rich Handler's conversation with a hedge fund manager. (Instagram)

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AUTHORSarah Butcher Global Editor

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