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Morning Coffee: Over-eager bank hires senior trader who was laid off 22 months ago

RBS

Yesterday was Ross McEwan’s first day as chief executive of RBS. Needless to say, McEwan didn’t give a speech telling RBS’s investment bankers and traders how very special they were: he gave a speech saying that RBS must lend more and focus on its customers.  

If you’re a trader who’s out of the market and is trying to get back, Ross McEwan’s RBS isn’t entirely a bad place however. Yesterday, it was also reported that RBS had hired Kieran Higgins, former co-head of fixed income at Nomura and a veteran fixed income trader from Lehman. Higgins had been out of banking for 22 months, having left Nomura in January 2012. The Financial Conduct Authority Register shows that Higgins wasn’t registered to work elsewhere during that time, although Financial News points out that he founded TKG Investments with other ex-Lehman traders in January 2013.

RBS has lost several senior fixed income traders and salespeople in the past 12 months and seems super-pleased to have snared Higgins, whom the bank described as bringing a ‘wealth of expertise’ and being one of the ‘most experienced rates traders’ in London. Notably, however, Higgins’ 2012 departure from Nomura came after the Japanese bank jettisoned a risky trading strategy pursued by Higgins’ ex-Lehman colleague and boss Tarun Jotwani (with whom Higgins set up TKG). Following the departure of Higgins, Jotwani and other ex-Lehmanites, Nomura subsequently installed Steve Ashley, a veteran rates trader poached from RBS, at the helm of its fixed income business. With Higgins’ arrival at RBS, the two banks have effectively swapped staff – and skeptics might say that RBS has ended up with the less risk-averse of the two.

Higgins’ return to banking from the hedge fund wilderness should give hope to other fixed income traders in search of an institutional role – the British bank looks open-minded about hiring and certainly has other seats to fill.

Meanwhile:

Ross McEwan joins RBS with the shares at 363.7p, below the average 502p at which the government bought its stake – and below the 407p where the Government holds the shares on state books. (Telegraph)

When everyone in banking was a risk manager. (The Guardian)

Senior bankers found guilty of reckless behaviour could be sent to prison for up to seven years and could face unlimited fines. (The Times) 

No one will want to be the boss of a bank if they can be jailed for 7 years. (Telegraph)

Begbies Traynor, the insolvency specialist, isn’t doing too well itself. (The Times) 

RBS inviting comments on Ross McEwan’s arrival on its website. Be the first! (RBS) 

11 simple rules for getting along with other people. (Farnam Street) 

 

 

 

 

 

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