Morning Coffee: Bank CEO reliant upon his wife for friendship upsets his wife. Citi's bonfire of the contractors

When your wife is the anchor for all your friendships, it's probably a good idea to keep her happy. Jes Staley, the former Barclays CEO currently in court trying to argue that he wasn't good friends with alleged paedophile Jeffrey Epstein, has not done that.

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Staley is seeking to overturn the FCA's ban on him holding senior positions in the UK Financial Services industry. In court this week, it became apparent that Staley, who has been married for around 40 years to Brazilian heiress and interior designer, Deborah Nitzan Staley, has not been faithful to her. 

As it sought to illustrate the depth of Staley's ties to Epstein, the FCA's lawyer asked Staley about the time he had a consensual sexual encounter with a woman at Epstein's brother's place.  “Oftentimes I would go to Epstein’s apartment and he would be late, and she and I got the chance to know each other,” said Staley, adding that the encounters were entirely consensual and are "much to my embarrassment today."

Fast-forward 24 hours, and Staley was mortified that details of his affair had become known. Yesterday, his legal team complained of "public humiliation" and Staley said he had put his "marriage at risk."

It's not clear how Staley's wife feels about the infidelity, but he conceivably has more to lose than she does. When the case opened, Staley said he was a loner and that he relied upon his wife's group of friends for company. They seem less likely to have him over in the future. 

Beyond the salacious details, the revelations offer further illumination into the thought processes of Staley, who spent nearly six years running Britain's second-biggest bank. With details of his affair made public, Staley is arguing that they reflect his honesty and willingness to be truthful irrespective of the personal consequences. 

“On my own costs, I crossed the Atlantic to be in the tribunal to be open and honest. I could have stayed at home. I am here to provide clarity to this tribunal. I’m not here to mislead,” declared Staley yesterday. “I have been honest such that I have put my marriage at risk these last few days. I have never shied away from telling the truth about all of this … I would not try to mislead the FCA. I never have and I never will.”

Staley's intense personal code of honour has caused issues before. While he was CEO of Barclays, Staley hired a former JPMorgan colleague with a drink problem and then tried to unearth the identity of a whistleblower who complained. In 2017, he upset KKR - one of Barclays' biggest clients - when he sided with his wife Deborah's brother in a dispute over the sale of their family business to the private equity giant. Deborah herself received $160m from that sale, according to the Wall Street Journal. While ructions in a 40 year-marriage will always be a difficult thing, she does at least have the option to walk away with more than the Staley family yacht. 

Separately, Citi is seeking to remedy its many technology issues. And it is doing so not only by hiring new technology executives, but by changing the composition of its teams to be less reliant on contractors.

Reuters reports that 50% of Citi's IT staff are currently contractors, and that Tim Ryan, the man now charged with overhauling the data team, wants to get this down to 20% over an indeterminate time period.

Contractors can be expensive. Citi also appears to think that they can be incompetent and untrustworthy. Ryan's presentation reportedly referred to a "recent fraud event" related to the work of external contractors and the bank wants to scrutinize its contractors more carefully in the future.

Meanwhile... 

Jes Staley's other strategy appears to be implying that other people at JPMorgan had relationships with Jes Staley. He says that Mary Erdoes could have dropped Jeffrey Epstein as a client if she'd wanted to. (Bloomberg) 

Deutsche Bank CEO Christian Sewing was given €9.8 million in total pay for 2024, compared to €8.7 million he received a year earlier. (Bloomberg) 

Deutsche Bank has shifted to a forward-looking model for long-term share-based incentives, linking payouts to performance over the next three years rather than the past three. (Financial Times) 

Someone is suing Deutsche Bank for €152 million ($165 million) in damages for alleged harm caused to his career by criminal proceedings in Italy related to Banca Montei Dei Paschi di Siena. (Reuters) 

Some HSBC bankers are now on three to six month gig economy contracts. (Telegraph) 

Jain Global now has 300 people (50 are portfolio managers). Last May it had 150. (Financial News) 

Burned out executives are good for boardroom headhunters. “So you look at those people that led organizations through a very, very difficult time in humanity, you probably have a lot of people saying: ‘Do I want something else in life?’” (Bloomberg) 

Citigroup disbanded its Asia high-touch equities sales trading desk in 2019, after accusing multiple staffers of misconduct and firing them without advance notice. Four have fired wrongful termination claims. (Bloomberg) 

Ziad Kerbage will build a team for Millennium in Monaco. (Bloomberg) 

If you don't get a promotion, ask for something else. 'You’re more likely to get a “yes” after a denial because most people don’t like to say “no” repeatedly.' (WSJ) 

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