In May, five heavy-hitting investment bankers accepted offers to leave Credit Suisse’s San Francisco-based technology team for a rival firm, Jefferies. Now the circumstances of their departure are unravelling.
A few days after the bankers officially resigned, Credit Suisse asked a judge for permission to do a forensic search of their computers and smartphones and an injunction to block them from starting work at Jefferies, accusing its former employees of stealing proprietary documents and trying to poach former colleagues before their period of gardening leave was up.
The investment bankers denied this in affidavits, but the judge granted key provisions of the injunction, ordering a litigation hold and sending the conflict to arbitration. However, they were allowed to continue working at Jefferies.
What Business Insider calls Credit Suisse’s “hasty and vague effort” to prevent harm to its technology business highlights the pressure it’s under to stem the tide of key departures from its investment banking division, with other senior dealmakers also having left this year.
It also raises key questions about what is proprietary to an employer and what is considered a trade secret. A banker’s client list? Compensation information? Old pitchbooks for already-completed initial public offerings?
What’s the bigger picture for Credit Suisse? With CEO Tidjane Thiam’s emphasis on wealth management above all other businesses, not to mention his assertion that investment bankers’ compensation should fluctuate with the market, it’s no secret that he’s rubbed many people in the IBD the wrong way. It’s one thing to trim the fat of a bloated or unprofitable division, but if essential investment banking personnel continue jumping ship in significant numbers, it will complicate Thiam’s turnaround efforts.
Separately, on the heels of Goldman Sachs CEO Lloyd Blankfein telling this year’s intern class to chill and to not be too goal-oriented or impatient of success, Michael Sherwood, the bank’s vice chairman and co-chief executive of Goldman Sachs International, offered his career advice to junior bankers.
Sherwood, who joined Goldman as a 20-year-old credit analyst, said: “My advice to people coming up the ranks: It takes all kinds of people to make successful careers at the firm. Be yourself, be authentic, don’t try to conform. Be motivated, have a thirst for information and have an intellectual curiosity.
“I would also say that people who have defined career trajectories have often been disappointed – don’t have a specific timetable around your career.
“Many things have changed [at Goldman]: We have expanded into multiple locations and we went public, to name just two. But our commitment to excellence, our ability to attract the highest calibre of people, our ambition to be the best that we can be – those attributes have remained consistent over my career at the firm. I must say the quality of the people we are able to attract is very humbling; in fact I often wonder how I ever got a job here!”
Meanwhile:
How the former head of Sanford C. Bernstein, Smith Barney and Bank of America’s wealth management division and founder of Ellevest attacked the boy’s club of Wall Street. (The Guardian)
Goldman Sachs and Morgan Stanley have taken on the tough assignment of reinventing themselves by turning to more basic banking businesses. (WSJ)
This is the set of personality surveys all candidates must take before getting hired by the world’s biggest hedge fund. (Business Insider)
Stemming from Anheuser-Busch InBev NV’s $103.8bn takeover of rival beer brewer SABMiller Plc, the former will pay out $135m for financial and corporate broking advice to Lazard, Deutsche Bank, Barclays, BNP Paribas, Bank of America and Standard Bank Group, while the latter will pay $113m for financial and broking advice to boutique investment bank Robey Warshaw, along with JPMorgan Chase, Morgan Stanley, Goldman Sachs and Centerview Partners. (Bloomberg)
Goldman Sachs published its second-annual Back-to-School Reading List, a collection of books recommended by the bank’s executives. (Fortune)
Despite the fact that many millennials feel that big banks are, at best, out of touch with what’s going on in the world, Goldman’s book list is surprisingly on point – you could almost say that it’s “woke.” (Bustle)
UBS tapped Chris Forshner to be global head of corporate origination in its debt capital markets clients solutions business (DCMCS). (Reuters)
In a bizarro-world post-Brexit move, UBS is cutting about 15 jobs at its investment bank and corporate center in Paris. More than half of the layoffs will be equities trading roles, but some of them may be relocated to London, of all places. (Bloomberg)
Mark Haefele, chief investment officer at UBS Wealth Management, points out a potential silver lining to the Brexit referendum result. (FT)
Like other European banks, Barclays is looking pare back its sprawling businesses amid low interest rates and increased regulatory pressure, and three spinoff deals are pending. (MarketWatch)
Compliance professionals with anti-money-laundering expertise rejoice! The U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) is extending AML requirements to all banks. (WSJ)
A team of Goldman Sachs analysts are now saying they believe Bank of America is poised to make a turnaround after meeting the bank’s CEO Brian Moynihan. (Fortune)
Citigroup, Deutsche Bank, Barclays and Royal Bank of Canada are providing financing for Apollo Global’s $4.3bn acquisition of cloud-computing company Rackspace. (Business Insider)
Deutsche Bank CEO John Cryan is not a fan of negative interest rates. (The Country Caller)
Existing compensation plans have “no empirically demonstrated validity,” according to a study, and are missing any assessment of how millions in cash and stock motivate executives—or don’t. (Bloomberg)
This is the definitive hedge fund interview guide. (SumZero)
There’s a reason Jim Rogers, an investor, financial commentator and the chairman of Rogers Holdings and Beeland Interests, isn’t likely to be hiring many people this year. (Business Insider)
In a bid to gain some fintech street cred and court millennials who are notoriously skeptical of big banks, JPMorgan Chase has launched an end-to-end car-buying service via smartphones. (Bloomberg)
The machines that run index funds slash the costs of investing by 90% or more by skipping most of the research and trading their human rivals engage in. Is passive investing “worse than Marxism”? (WSJ)
Hiring more attractive teachers – or subsidizing gym memberships and makeovers for current professors – is one effective way to help students do better in school, according to a recent study. (WSJ)
“Drawing on our experience of various bonus-led remuneration models, we concluded that bonuses are largely ineffective in influencing the right behaviours. There is little correlation between bonus and performance and this is backed by widespread academic evidence. Many studies conclude that bonuses don’t work as a motivator.” (The Telegraph)
A study found that at least 40% of top earners’ wage growth can be traced back to headhunters offering exclusive opportunities to high-skilled workers at the best firms – along with a paycheck that less-well-trained people won’t ever see. (Bloomberg)
The gender pay gap widens for women after starting a family, so here’s advice on balancing childcare with a career. (The Guardian)
Dolly Parton and other boss women share their best career advice, including the truism that you’ll inevitably get bad career advice. (Cosmopolitan)
Follow @danbutchrwrites
Related articles:
Morning Coffee: Lloyd Blankfein’s warning to the elite teenagers. Two more years of banking job cuts?Goldman Sachs has a warning for those teenagers expected to make it before they're 20. It's grim out there for investment banks.
Morning Coffee: Inside the most high-profile deal of the year. You can still get hired as a dirty traderWhat was it really like trying to sell Gawker when Hulk Hogan and Peter Thiel were on the attack? The banker leading the deal reveals.
Morning Coffee: Why UBS bankers don’t need more money. The London fintech shiftUBS head eases pressure on his bankers. And applications from UK fintech staff are surging into this European city.
Photo credit: viki2win/GettyImages