Morning Coffee: Ex-Barclays traders want to sue Barclays. Why now is a fine time to start your life in private equity

As we predicted here last week, Christian Bittar, the legendary Deutsche Bank rates trader who once made a bonus of $140m while speaking softly and eating boiled eggs and junk food, and who was imprisoned for nearly two years, has had his conviction for conspiracy to defraud via manipulation of the Euribor rate quashed. So, too, have five former traders from Barclays.

Now they want vengeance. And that could be expensive.

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The latest quashing of the convictions came after Tom Hayes, an ex-UBS trader, and Carlo Palombo, another ex-Barclays trader, had their own convictions for manipulating benchmark lending rates quashed last year. The British Supreme Court deemed that the jury had been wrongly instructed by a judge, who'd said that if Hayes took the commercial interests of the bank into account when influencing Libor rates, the rate he suggested was necessarily improper. The subsequent convictions of Bittar (who pleaded guilty because, the FT says, the court rulings at the time meant that he felt that he had no viable defence) and the other five Barclays traders hinged on this judge's wrongful advice. Once Hayes' conviction had been overturned, the rest seemed bound to follow. 

Hayes himself is already suing UBS for $400m for 'malicious prosecution' after he says the Swiss bank unfairly framed him as the "evil mastermind" of Libor rigging simply because he was a bit vulnerable and the "perfect fall guy." Speaking to the Sunday Times at the weekend, two of the exonerated Barclays traders - Alex Pabon and Jay Merchant - said they would consider suing Barclays too. 

Pabon told The Times he'd been made a "scapegoat" and that his life had been consumed by the overturned conviction. "When these investigations started, I was 31 years old. That was when I was first contacted about the Libor investigation. And I’m 48 years old now; 31 to 48 — it’s your prime working age, and for me it’s really been consumed by Libor.” 

There is one single trader conviction yet to be overturned. It concerns Peter Johnson, another former Barclays trader, who was sacked after 30 years with the bank in 2012 and then jailed for two years for manipulating interest rates. Speaking to the BBC three years ago, Johnson said the conviction took a huge toll on his mental health. "[When I woke up] I'd have about five seconds when I thought all was well with the world. And then I'd realise that it wasn't. And I'd go around all day with a sort of a weight pressing against my chest. I'd wait for six o'clock before I started self-medicating with alcohol. I had panic attacks."

Johnson too now wants his conviction overturned. When he does, he too may want to sue Barclays. Ironically, before his conviction Johnson had even raised concerns about Barclays ‘low-balling’ its Libor submissions and wanted to set them higher, but leaked audio recordings obtained by the BBC showed him being pressured to keep them low. "In my most optimistic view, I would like my guilty plea to be revoked. I'd like to basically have my reputation restored. And I'd like senior people to be held accountable," said Johnson back in 2023.

Not all the exonerated Barclays traders are coming after the bank. Colin Bermingham told the Times that life is too short: “I’m 70 years old … This is going to be a long, drawn-out process. I’ve already invested too much of my life in having this all hanging over me.” Barclays may only hope that others feel similarly. 

Separately, much has been said about the fact that leaving banking for private equity doesn't seem like a good move nowadays, but maybe that's wrong?

Private equity bosses think so. Gathered together at a summit held by the Financial Times in London, they said now's a fine time to start a career in PE. Dipan Patel, co-chief executive of UK-headquartered buyout group Permira, declared, for example, that the current vintage of PE deals "will be among the better" and that the "top quartile will have exceptional returns."

This is because high rates aren't a problem once everyone accepts the new world. “It’s a problem to be in a low-rate environment,” explained Patel. “Being in a high-rate environment, eyes wide open, is not a problem for private equity because it translates into deal pricing.”

Julian Salisbury, who was once the highest earning person at Goldman Sachs, was also at the Summit. He said that even the "pig in the python" companies stuck in buyout portfolios have the potential to make money for funds. These pigs need debt or equity investors to "provide them incremental financing so that they can refinance and extend the hold of the asset.”  

Meanwhile...

The third quarter for banks wasn't as good as previous quarters and this may make it hard to allocate bonuses. “For the first half of the year it’s almost like everybody won, and now that might not be the case,” Mike Mayo said. “There’s likely a wider dispersion this quarter between the winners and losers.” (Bloomberg) 

Data centre company Firmus Grid pulled its $30bn IPO, thereby delaying the redemption of its co-founder, who once served time in prison on insider trading charges. (Bloomberg) 

Who will be the future COO of Goldman Sachs. Could it be Denis Coleman? Could it be Ashok Varadhan? (Reuters) 

100,000 people applied for Revolut's internships and graduate programmes. That's 330 per job. (The Banker) 

What it's like when you get an internship at Susquehanna: “When I got the offer call and they said how much the salary was, I asked a few times if they were saying the right number. I can’t fathom how an intern should be making that much money.” (WSJ) 

Jennifer Davey, early careers recruitment manager at Deutsche Bank said you can stand out during applications by elaborating on why a transaction interested you as well as the strategic rationale behind it and why you think it reflects Deutsche Bank’s broader capabilities. (Financial Times) 

How to leave your career as a professional tennis player and get a job at Goldman Sachs. “I took 342 meetings to get to know different people in 2025. I met over 15 different people at Goldman. I joined through a kind of internship programme. I did eight formal interviews within the span of three days..." (The Times) 

EY cut jobs in America last year but it hired for its global service centres and centralized tech functions and so increased headcount 12%. (FT) 

Ryan, a US tax firm, wants to hire and promote 100 partners in the UK and Europe in the next three years. (The Times) 

There is a new trend for "loud working" in which people try to ensure their work is visible and gets noticed. (Business Insider)  

The nice thing about bonds is that if you're right, you get paid no matter what anyone else thinks. Bill Gross would look at high-yield bonds that were about to mature, but still carried high interest rates that implied ridiculous odds of the company running into financial trouble in the next few months. (The Diff) 

How trend following funds make money: you lose small and often but then make money once a trend becomes established. (Navnoor Bawar) 

Greg Coffey's Kirkoswald Asset Management had a good September and has returned 20% this year. (With Intelligence) 

"We’ve added a prohibition on sustained and needless abusive or cruel behavior toward our models. The policy update is meant to apply only in extreme cases, where users repeatedly act cruelly toward our models, with no discernible purpose." (Anthropic) 

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