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Morning Coffee: Deutsche Bank to cut 40-50% of its staff? J.P. Morgan is hiring 1,800 people here.

John Cryan

If the Financial Times is right, something very bad is afoot at Deutsche Bank. The paper says CEO John Cryan has told ‘colleagues’ that there’s no reason why the bank’s 100,000 staff globally can’t be trimmed to match the number of employees at European rivals like Credit Suisse and UBS, banks which employ 60,000 and 47,000 people respectively.

The FT also claims that Cryan has warned that many Deutsche Bank bonuses will, “go to zero” this year as he cuts costs, sells assets and overhauls the bank’s technology systems. Cryan is reportedly planning to focus particularly on cutting Deutsche’s interest rate swaps and doing away with it’s 30,000 contractors worldwide and its 20,000 technologists in India. Right now, Deutsche’s interest rate swaps have a notional value of about $50tn — two-thirds of the world’s gross domestic product. Something needs to be done.

Separately, J.P. Morgan is cutting costs. Back in February, it announced $1.4bn of cost savings in its corporate and investment bank and consumer banking businesses during 2015. – But this does not appear to preclude some serious hiring over the next four years.

DelawareOnline and the New York Times report that J.P. Morgan is about to embark on a recruitment drive in Delaware. The bank wants to add 1,800 jobs in Delaware by 2019, says the New York Times, mostly in ‘technology, finance, asset management and global data operations.’ DelawareOnline says many of the new jobs will be located at the bank’s Delaware Technology Centre, although five of the bank’s other buildings in the state are also expected to house the new hires.

The expansion in Delaware comes 18 months after the bank announced a £28.6m ($43.9m) investment in its UK technology and operations centre in Bournemouth.  Unlike at Deutsche, operations and technology jobs are growing at J.P. Morgan, just not in expensive financial centres like London and New York City.

Meanwhile:

Cryan plans to completely replace Deutsche’s IT systems. (Financial Times)

RBS is launching an internal networking site in partnership with Facebook. All the data that resides in the application belongs to the employer. (Financial Times)  

If you want to work somewhere were median pay is $425k (£277k), you need to get yourself an MBA and go along to Morgan Stanley. The US investment bank pays its average MBA alumnus $425k. Goldman Sachs and Deutsche Bank pay around $405k and $350k. Apple and Google pay a mere $275k each. (Bloomberg) 

Standard Chartered is getting out of the equity derivatives and corporate bonds businesses. (Reuters)

A Lloyds trader who formerly earned £225k is representing himself in court against his employer. His written witness statement was full of exclamation marks, capital letters and expletives. (Bloomberg) 

A former Goldman Sachs employee is involved in a criminal trial after he received confidential government information about a bank he was advising. He only worked for Goldman for three months. (NYTimes) 

Crispin Odey may regret that ‘chicken house’. (Bloomberg) 

Banking professionals are wiling to pay between £2,000 and £4,000 a week for rent in London.  (City Am) 

How your personality determines the way you interact: Extraverts shift from free-riding to cooperation in the presence of punishment, agreeable people make early contributions regardless of the game, neurotics make lower contributions regardless of the game. (Royal Society)

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