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Morning Coffee: Meet the new super-sought-after bankers; J.P. Morgan has been very kind

A crisis is brewing in the world of banking recruitment. Banks are notoriously short of senior women and the British Prudential Regulation Authority has decided it would like to set targets stating that banks have to employ a certain number of women at senior levels.  Banks which don’t meet the targets would be in breach of the PRA’s rules.

It’s not clear when the suggested new rules could be implemented. However, they are being discussed as part of the PRA’s plans for implementing the EU’s CRDIV directive, which includes the EU’s bonus cap and CRDIV is being implemented from 2014.

Fixed targets for the employment of senior women in banking will have a predictable outcome: the price banks pay for super-scarce senior females will rise. Earlier this year, the Parliamentary Commission on Banking Standards proposed putting more women onto trading floors, something which headhunters also warned would simply push up the bid price for rare women traders. The problem can’t be remedied overnight. Banks struggle to retain senior women, but they also struggle to employ them in the first place. Figures from the Royal Economic Society’s Women’s Committee show that 5,500 women are currently studying economics in the UK compared to nearly 15,000 men.

Separately, J.P. Morgan may have been a bit too nice to Javier Martin-Artajo, the manager who oversaw the trading strategy in J.P. Morgan’s CIO. Last year it was reported that J.P. Morgan had filed a claim against Martin-Artajo personally for his part in the $6bn London whale loss and that the bank wanted to clawback the bonuses Martin Artajo received before and during the trading disaster. Subsequently, however, it was reported that Martin-Artajo had settled with J.P. Morgan out of court, implying that he got to keep some of his deferred compensation after all.

That settlement is starting to look a little premature. The New York Times reports that U.S. federal authorities are preparing to file criminal charges against Martin-Artajo and a junior trader, Julien Grout. Bruno Iksil, who’s been more closely associated with the $6bn loss, might not be charged at all. Was J.P. Morgan too kind to Martin-Artajo? Criminal charges suggest the bank would have been within its rights to clawback his deferred bonuses in their entirety.

Meanwhile: 

Internal email and phone recordings are alleged to show that Mr Martin-Artajo asked Mr Grout to falsify records, causing the bank to understate the size of its losses.(Telegraph) 

740 partners at Deloitte took home an average of  £772k last year. (The Guardian)

Partners’ average earnings at Deloitte are now almost £200k below the peak of 2008. (The Times)

The average pay for an asset manager is probably still less than the average pay for an investment banker with comparable experience. But the gap is closing. Soon it could well disappear. (Financial News)

Banks can’t find anyone to structure, price, and originate CLOs. (Financial News) 

Over a trailing 12 month basis, banks’ costs are the same as they were in 2009, but revenues have fallen by 20% since then. (Financial News)

Once again, analysts are being used to help solicit IPO work for banks. (DealBook)

RBS bankers will be working for the British government for another five years. (Reuters) 

Man receives promotion at RBS. Leaves anyway. (Financial News) 

Global head of investment banking at Credit Suisse says that if you want to make money you need to focus on the Americas. (Bloomberg) 

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