Banks are already talking about hiring for 2022

The Goldman Sachs Financial Services Conference in the United States is sometimes a somewhat offbeat event for the CEOs of investment banks attending. Like Brian Moynihan of Bank of America, they generally want to paint as optimistic a picture as possible to their shareholders. But December is also the month for managing bonus expectations for their own employees. And when the boss talks about having “increased the CEOs in the company by 10% since 2019, and we’re going to continue to do that, MD and D,” it makes it a little harder to talk about restraint and cost. – cut in town hall of the investment bank a few days later.

Regardless of the embarrassment generated by Moynihan’s comments, it looks like BofA is definitely taking center stage and looking to hire new staff while keeping the ones she already has. This should mean that they will have to pay accordingly in the next bonus round. BofA disappointed a lot of people last year with the increase in deferral periods and rewards below a few peers, and the last time Moynihan spoke about the “war for talent,” it prompted some recruiters to say that they had to work things out with existing staff before finding new ones.

But will they do it? In a talent market like this, sometimes it is possible to get caught off guard if you just sit back and assume that you will be taken care of because the business grows. New senior hires need to be drawn away from their current employers, and they generally want “visibility” of their total roster. Brian Moynihan expects 2021 to be as good a year for sales and trading as 2020. But that could be a mixed blessing; 2020 hasn’t really been such a great year for trading income at BoA and if this year’s bonus pool reflects that, then there could be some nasty surprises.

Caught between the imperative of growth and the need to be disciplined when it comes to costs, managers often respond by increasing the degree of differentiation between bankers they see as top performers and those who only meet expectations. . This means that it is not a good market for the modest and unpretentious types. The middle ranks tend to be tight; junior bankers are cheap enough to stay happy, while rainmakers are rewarded for the income they generate, but vice presidents and directors who make deals buzz can often be overlooked.

Unless, of course, they have another offer. Almost every bank on the street seems to be saying something similar to Bank of America, and not all of them can expect to poach from Credit Suisse (which is also committed to defending its franchise). The employee’s best weapon in bonus negotiations is a clear idea of ​​their market value, preferably accompanied by an option to go elsewhere. If you want to make the most of the current market conditions, be sure to return calls from recruiters.

Elsewhere, it has sometimes been said that the difference between bonds and stocks is that bond traders think 1% is a big move while people in stocks think $ 50 million is a big trade. Historically, one of the other big differences has been that the equity market is increasingly dominated by quants of one kind or another – a computerized trend-following system placing an order on an electronic market to run by an automatic market maker, for example. example – whereas the credit market is much more about humans doing analysis and picking up phones for quotes. Now that might be about to change.

There are of course significant obstacles to this; bonds are a lot less liquid because there are a lot more of them than there are stocks, and a lot of them hang around in pension fund coffers and never trade. And the quality of the data in the credit markets is legendarily terrible compared to the high frequency data feeds of the stock exchanges. But according to people like Alex Khein of the hedge fund BlueCove, these are problems to be solved, and the constant increase in computing power means that the “traditional, traditional approach” is coming to an end and is “scientific” and trading quantitative is likely to take more market. share – and reduce profit margins, and replace headcount in sales and commerce – every year.

During this time …

Michael Steinhardt, the legendary hedge fund trader and owner of a fantastic collection of antiques many of which apparently “disappeared” during the Civil Wars, has made a deal with the New York attorney’s office under which he promises not to. never buy old art again. (Bloomberg)

“Fevertree” certainly sounds like the kind of name an investment bank might have. In fact, it’s the name of a premium tonic water maker, but its Global Strategy Director, Rachel Stott, worked for JP Morgan for four years before joining and has now moved to Numis within their private market capital solutions team. (Financial news)

For players who think roulette and slots just aren’t arbitrary enough, a proposed New York City casino aims to include a cryptocurrency trading floor (Bloomberg)

No more all-you-can-eat brunches on Friday mornings, no more irritating programming errors on the sales side and no more quiet weekends on Sundays; the United Arab Emirates have changed their working week from the typical Middle Eastern schedule to the international definition of the weekend. This is aimed at attracting European and American expats, although the fact that Saudi Arabia and Israel are still weekends from Friday to Saturday means that many bankers in Dubai are afraid of working six days. (WSJ)’s Vishal Garg appears to be repenting at leisure after laying off 900 employees in a Zoom call, then going online to discuss their laziness. He has issued a public apology, but the company appears to be losing executives who no longer want to work there. (Daily beast)

Just because payment processing is extremely boring doesn’t mean it can’t support an exciting lifestyle. Anthony Watson of the new specialist clearing bank “Bank of London” describes himself as “the insta-banker” and posts selfies from yachts and private jets. (It’s money)

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