Morning Coffee: Bank paying bonuses monthly to save cash. Santander swoops on out of work Goldman bankers
Last year was a bad year for investment banking revenues, and this year has been even worse. Globally, revenues were down 20% year-on-year in the first nine months according to Dealogic. In Australia, they were down 44%.
This might be why Barranjoey, a loss-making Australian investment bank backed by Barclays and named after a small kangaroo, is taking the sort of remedial action that could catch on.
Faced with falling fees and restless staff, the Australian Financial Review says Barranjoey has decided to pay its bonuses monthly for the next year. Barranjoey bonuses, which comprise cash and stock, are announced annually in August. Barranjoey always paid its bonuses quarterly, so the switch to monthly payments is less of a shock than it might have been at a bank with an annual payment schedule.
Employees are reportedly sanguine about the new arrangement, even though it means they won't get their cash all at once and payments for retrospective performance will be strung out over an entire new year, preventing them from changing jobs unless a new employer is willing to buy out the withheld installments.
Formed in 2020, Barranjoey spent much of 2021 hiring senior bankers from UBS in Sydney. Employees own 45% of the equity in the business, which might make them more inclined to accept the new bonus schedule than if they were working for a large US bank that tried the same thing. Some London brokerage firms already pay bonuses quarterly, but Barranjoey is breaking new ground.
Separately, Santander is still hiring, and not exclusively from Credit Suisse. Financial News reports that its latest London hires include Mitul Patel, a former Goldman Sachs managing director, who left earlier this year (presumably after Goldman's first round of layoffs) and Myles Evanson from Nomura's private capital markets business. Santander has also been back to Credit Suisse and hired Eduardo Trocha in leveraged finance. Santander is hiring 20-30 bankers in London and 150 globally.
UBS is pulling out of municipal bond trading business and will probably be cutting some jobs in the process. (Bloomberg)
Wintermute co-founder Yoann Turpin: “We’re actually seeing really good talent going back to TradFi.” This is a result of big banks entering the crypto space. (DLNews)
Electronic market maker GTS did a deal with algorithmic trading firms HC Technologies and 50 HC staff will join. (Bloomberg)
Dmitry Balyasny is selling one of his two condos at the Four Seasons in Chicago for $4.5m. (ChicagoBusiness)
London hedge fund Pelham Capital has lost 75% of its assets and people have left. (Financial Times)
Justin Lada, global head of electronic strategy for credit trading & sales, is joining Susquehanna. (Fi-Desk)
PWC wants students to come back into the office for interviews. (Financial News)
UK private equity funds are mostly selling assets to themselves in 'continuation funds'. Supporters of the method say flipping assets from one fund to another can allow private equity firms to continue benefiting from assets with strong cash flow. (Financial Times)
Goldman Sachs started building the Dallas campus which will eventually house its 5,000 Dallas employees, of whom 1,000 are engineers. (Bloomberg)
If someone sends you an email offering you a Taylor Swift ticket, it's probably just your employer seeing how gullible you are and conducting a phish test. (WSJ)
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