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Morning Coffee: Why B of A is the place to be in fixed income trading. Bob Diamond, the nice man

Bob Diamond

Is Bank of America shaping up as the place to be if you work in fixed income sales and trading? The U.S. bank has increased salaries for risk takers by 20% in London and its global markets business was in very good shape in the fourth quarter of 2013 (admittedly thanks mostly to its equities business). OK, so Bank of America doesn’t pay too well overall in the City and, yes, it dumped its EMEA head of rates and currencies just before bonuses this year, but it hasn’t been losing market share like Deutsche Bank and it doesn’t have cost issues like Barclays. Oh, and it’s hiring….

Financial News reports that Michele Foresti, the senior Deutsche fixed income banker who reportedly left the German bank yesterday, is resurfacing at B of A, where he will be head of FICC trading for EMEA. Foresti will join the US bank in June after a short period of gardening leave. What’s the likelihood that other Deutsche FICC bankers will follow him across?

Separately, while Rich Ricci is reportedly making wild boasts about his horses at the Cheltenham races, the Australian Herald Sun has come across a story suggesting that Bob Diamond is a pleasant and forgiving person. When Bob first bought his apartment at New York’s exclusive 15 Central Park West, the Sun reports that he left it empty but for some furniture and (expensive) paintings. The son of a neighbour infiltrated Diamond’s unoccupied apartment and took a painting (which he placed in his parents’ residence downstairs). Diamond discovered the loss and the thief was uncovered. Kindly Bob, however, decided not to press charges. “Diamond was a real sport about it,” said a New York realtor admiringly.

Meanwhile:

Julia Hoggett, a DCM MD at BAML, is off to become investment banking supervisor at the FCA. (IBTimes) 

FX traders are being killed by a lack of volatility. (Financial Times)  

How the 4pm FX fix works in practice. (Guardian)

Traders should be measured on their hit rates and payoff ratios. The hit rate, is the percentage of times they’re right about the direction of a security. The payoff ratio is the money made on successful investments divided by the amount lost on unsuccessful ones. (Bloomberg) 

Jonathan Fell and James Isenwater, two ex-Deutsche Bank consumer analysts, have founded a Luxembourg-based hedge fund called Ash Park Capital. (Financial News) 

Samuel Robinson, chief administrative officer and head of strategy for the investment banking division at Goldman Sachs, is leaving after 18 years. (Bloomberg) 

Fabrice Tourre has been ordered to pay $650,000 in civil penalties and $175,463, the amount of his bonus that the Securities and Exchange Commission said was related to the controversial Abacus product, plus interest. He can’t ask Goldman Sachs to repay him for the civil penalties. (MarketWatch) 

The average cash bonus for New York-based financial services employees in 2013 was $164,530, according to an annual report released by the New York State Comptroller. (Business Insider) 

Canary Wharf bankers about to be engulfed by hipsters. (Financial Times) 

If the higher rate tax threshold had kept pace with wage growth since’78, you could earn £75.7k today  and still be a lower rate UK tax payer.  (Financial Times) 

Related Links:

Time to preemptively escape Deutsche Bank and Barclays’ FICC businesses? Banker tantrums

UK banker-bashing-bonus-tax, redux. How to lure top bankers cheaply

Sexism, nepotism, cage fighting and assassination – where you don’t want to work in finance. Recruiters get their sums wrong

 

 

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