Morning Coffee: Citi’s senior outsiders are scrutinising the existing talent in their teams. Goldman Sachs’ 27 year old MD gets another huge promotion
Citigroup’s reorganization is an ongoing project, and after the announcement of the 2024 results, focus has moved on to the next stage. Cutting out the dead wood and simplifying the management structure is one thing, but you also have to decide who is going to manage the key business units in the future. For example, there’s currently a vacancy in the investment bank for a Global Head of M&A, which definitely needs to be filled if Citi is to take advantage of the deal boom that everyone expects.
Vis Raghavan is not necessarily planning to fill that seat by recruiting another one of his former JPMorgan colleagues, or even an external candidate at all. Instead, Raghavan is saying in interviews that, “There is a lot of talent internally … We would be open to all ideas but there is such a deep bench there that I just want to evaluate what I have.” And he’s not the only top Citi executive who is looking inside the bank to fill key roles.
The technology division, for example, is going through its own top level restructuring under Tim Ryan, a strategic hire from PwC last year. Ryan has brought in one former colleague (Julien Courbe). But the other names on the all-staff memo which went round on Monday describing the new tech leadership are mostly Citi insiders. Ryan said he spent the last six months “tak[ing] stock of the tech team's weaknesses and strengths”.
It shouldn’t come as too much of a surprise. External candidates are expensive; the person you might really want for a job already has one, and is likely to want a substantial premium to move from their existing comfortable and efficient team to work twice as hard on a fixer-upper. Banks can’t always afford the lengthy process of wooing and hiring a star from outside. And even when an outsider is brought in specifically to clean house, they usually end up using a lot of the existing brooms to do so.
More than that, though, new leaders need to manage the morale of the franchise they’ve been brought in to fix. If the impression is allowed to develop that the whole business is going to be run by a clique of people who met at another bank, insiders are going to lose any sense of involvement. The good ones will leave, the mediocre players will give up, and the whole task becomes twice as hard.
That’s why executives like Raghavan and Ryan are well advised to leave some top spots for insiders. And it’s also why people shouldn’t give up hope in the event of a big external hire like the ones Jane Fraser has made. If you make sure to demonstrate how much you embrace change and want to succeed, it might be an opportunity rather than a threat.
Elsewhere, Goldman Sachs has announced promotions in its Global Banking and Markets division which deliver the rarely seen “triple-triple” – there are now three global co-heads in investment banking, fixed income currencies and commodities (FICC) and equities. So congratulations to Kim Posnett, Matt McClure and Anthony Gutman, to Jason Brauth, Kunal Shah and Anshul Sehgal and to Dmitri Potishko, Cyril Godeeris and Erdit Hoxha, respectively.
As well as the nine-headed hydra of an org chart, this reorganisation looks like a significant bet on youth. Kunal Shah, for example, is only 41 years old, having made MD at the age of 27 and partner at the age of 31. (Although that is pretty spectacular, he is arguably only the second most successful 41 year old called Kunal Shah!) The other promotions are not quite so youthful (Anthony Gutman is 50), but they’re all definitely of a different generation from David Solomon.
Which makes sense; Solomon has recently signed up to another five year term as CEO, and it makes sense to have a clear age gap between the most likely candidates to succeed him and the heads of Goldman’s key operating businesses, so that the long term future of the top team can progress smoothly through the generations. Unless, of course, someone takes another look at Kunal Shah and decides, once again, that if he’s good enough, he’s old enough.
Meanwhile …
Although the election night “Trump Trade” was pretty straightforward, according to Mary Erdoes the flood of executive orders coming in from his first day in office has required a “war room” full of bankers and economists pulling all-nighters to assess the potential impact. (Reuters)
The overall consensus from Davos (and come on, when has that ever been wrong) is definitely that the new administration is great news for banking business. (Guardian)
Brevan Howard’s program of redundancies in its trading team looks a little bit larger in percentage terms than many recent asset management headcount reductions – it’s 7% of the total, albeit that this is only ten or eleven people. (Bloomberg)
Way back before Donald Trump started his first Presidential campaign, Michael Kramer was fired from Perella Weinberg. According to Kramer this was the culmination of a nasty personal feud; the bank says that they caught him trying to launch a rival business. Now the whole thing is coming to trial, and many precedents regarding non-compete and non-solicitation clauses may be set. (FT)
Jamie Dimon demonstrates once more that he has the juice – a passing mention of a small company in his keynote speech at the JPM Healthcare conference has apparently led to a flood of investor interest. (Bloomberg)
Brevan Howard cut 7% of its trading staff. (Bloomberg)
If you’re using a quiet afternoon to play the traditional British game of “who on this trading floor is the most posh?”, here’s a guide to the rules under which elite status can depend on birth, education, money or cultural clout. (London Review of Books)
Have a confidential story, tip, or comment you’d like to share? Contact: +44 7537 182250 (SMS, Whatsapp or voicemail). Telegram: @SarahButcher. Click here to fill in our anonymous form, or email editortips@efinancialcareers.com. Signal also available.
Bear with us if you leave a comment at the bottom of this article: all our comments are moderated by human beings. Sometimes these humans might be asleep, or away from their desks, so it may take a while for your comment to appear. Eventually it will – unless it’s offensive or libellous (in which case it won’t.)
Photo by Mariela Ferbo on Unsplash
