It’s not always easy being a young person working in the investment banking division (IBD) of a major bank. Not only are there the long and erratic hours to contend with, there’s also the pay differential with people outside finance. As the recent compensation survey from (London-based) recruitment firm Dartmouth Partners showed, junior bankers are still paid way more than everyone else. That’s a problem if you’re socializing with university friends who went into less lucrative careers.
Fortuitously, there’s a solution. Bloomberg reports that young finance professionals and other millennials-with-money are being wooed by exclusive members-only organizations like Select, Magnises and Founders Club. Through them, income-rich millennials get to fraternize at club nights and networking events, and to avail themselves of perks like concierge services.
“Employment and income are a factor,” says the Select CEO of his 10,000 strong community, mostly comprised of 20-somethings each of whom have an average income of $280k (£216k). The groups are as much for successful technologists, creatives, and entrepreneurs as for bankers. “We can’t let in 2,000 people from the same company tomorrow, because it would sway the group and the group-think,” says the CEO of Magnises.
Predictably, however, young bankers do seem to be a biggish part of the demographic. At a Magnises event in a Manhattan hotel, there are bankers, designers and a computer programmer discussing the history of Eastern Europe. For young bankers, the events help fill a social gap: “I might know 15 minutes beforehand that I actually have some time this evening,” Alexis Zumwalt, a then- 24 year-old investment banking analyst at PWC who used Magnises, told Racked earlier this year, “It’s hard to find something to do.”
By offering young bankers exposure to successful professionals in other industries, the events can also offer an opportunity to network their way out of finance. LinkedIn reveals that Zumwalt, for example, quit PWC in July and now works for Status Labs, a reputation management company. We don’t know for sure that Magnises inspired her to leave, but it will certainly have opened her eyes to the opportunities in other sectors.
Separately, Colm Kelleher, president of Morgan Stanley’s investment bank, has nailed the City’s problems with Brexit. The immediate problem is the uncertainty, Kelleher told the BBC. Because he doesn’t know what’s going to happen, he doesn’t know whether to invest (A.K.A whether to hire in London). Longer term, the issue is the most efficient location for Morgan Stanley’s London staff: Kelleher pointed out that many aren’t British and have spouses that work in mainland Europe – they might simply decide that it’s time for them to leave the UK.
Meanwhile:
Maybe the City of London should use Guernsey as a model? It’s outside the EU for regulatory models, runs a ‘partially equivalent’ regulatory model that gives it access to some EU markets, and contributed financial services contributed 33.4% of all output in 2015. (Financial News)
Some bankers asked Theresa May for a transition period of around five years on top of the two years it will take to negotiate Brexit. Others noted that a number of clients were already asking them to move operations on to the Continent. (Politico)
Blackrock: “I don’t think there is any firm, any good firm, that has not already started to look at real estate in different areas outside of the UK in case they have to move larger operations.” (Financial Times)
J.P. Morgan: “It’s hard to see how we can serve all of our European clients, and the European economy, without access to the single market.” (Financial Times)
Banks could use booking systems that initially log trades in an EU location and then replicate the transaction in London. “It’s pretty easy to switch booking entities.” (Financial Times)
Arguing that Britain needs to be in the EU because EU companies will lose access to capital markets without the City of London, is not really going to work. (Bloomberg)
Suddenly, London equity capital markets bankers are “off their feet busy.” (Financial News)
Sam Ruiz, a former head of equities trading at both Nomura and Lehman in London, has joined Tullett as chief executive of its institutional services division. (Financial News)
Michael Dryden has been promoted to global head of asset finance at Credit Suisse. (Reuters)
Bob Diamond fancies investing in Italian banks. (Bloomberg)
Maybe Deutsche Bank will need a bailout from the German government? (Handelsblatt)
Private banks like Lombard Odier and Kleinwort Benson are still hiring in London (Lombard Odier wants 10 people this year and next). (Financial Times)
If you blew the whistle at Wells Fargo: “If this person was supposed to be at the branch at 8:30 a.m. and they showed up at 8:32 a.m, they would fire them.” (CNN)
The art of cold-emailing: Find a commonality. Being part of the same group. Look for unexpected connections, like hometowns and unusual hobbies (HBR)
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Contact:SButcher@eFinancialCareers.com
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Photo credit: after work by Lena Vasiljeva is licensed under CC BY 2.0.
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