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Morning Coffee: Revolving door continues at Credit Suisse. Deutsche Bank cuts 450 global markets jobs

Goldman Sachs

Credit Suisse CEO Tidjane Thiam’s restructuring strategy has involved plenty of departures from the bank, some voluntary, most not. This has been leaking from the bank’s edifice in drips and drabs.

There have been a string of senior executives who have left recently, including former co-head of the investment bank Gael de Boissard, former U.S. private banking head Philip Vasan, former head of high-yield bond trading Matthew Courey and former head of U.S. distressed debt trading Robert MacNaughton. No one in a securities business deemed by Thiam to be risky or unprofitable is safe.

Now, another key executive who was a favourite of former CEO Brady Dougan is leaving Credit Suisse. Bob Jain, who has worked at the bank for 20-plus years and serves as the global head of asset management. This summer, Jain will become co-chief investment officer at Izzy Englander’s New York-based hedge fund Millennium Management, which had $33.1bn under management as at 1 March.

All of these high-profile exits may all be part of Thiam’s master plan to emphasize wealth management at the expense of its global markets division, from which an additional 2,000 jobs will be cut, primarily in North America and Europe. Credit Suisse is cutting risk-weighted assets in the trading unit by a further 20%. U.S. fixed income salespeople and traders should not feel secure.

With trading revenue at the investment bank is expected to be down nearly 50% year-on-year in the first quarter and other headwinds, Thiam’s strategy had better start showing signs of spurring a turnaround sooner rather than later.

Separately, Kim Hammonds, the global chief operating officer at Deutsche Bank, has reduced third-party service providers by one-third to 57,000 companies and plans to make a further 50% reduction next year, according to the Financial Times.

In addition, Deutsche eliminated 450 jobs from its struggling global markets unit, which includes fixed income and equities trading and has 6,000 back-office operations staff. These job cuts spanned India, the U.K. and the U.S.

The redundancies are part of the strategy that new co-chief executive John Cryan talked about the last year, including plans to cut 9,000 jobs out of its more than 100,000 employees and 6,000 of its 30,000 external contractors.

Meanwhile:

About a quarter of rowers who participate in the annual Oxford vs. Cambridge boat race along the River Thames seek to transition to a job on Wall Street or in the City of London. (Bloomberg)

An Ivy League graduate and former managing director at Park Hill Group, a subsidiary of Blackstone spinoff PJT Partners, was charged with securities fraud and wire fraud totaling $95m. (Reuters)

The bilked investor was a charitable foundation affiliated with “a multi-national hedge fund, headquartered in New York,” which was expecting a 15% annual return on an investment with 90-day liquidity fully collateralized by cash – a promise that’s suspicious in and of itself. (Bloomberg)

Hedge funds pumped boatloads of cash into Silicon Valley, but now many are pulling it out. (Bloomberg)

Regulation could be coming to Fintech (WSJ)

Morgan Stanley allegedly ran a “Glengarry Glen Ross” type competition after which it awarded prizes to employees who sold the most securities-based loans, a potential conflict of interest. (New York Post)

This former banker left Citibank to become a restauranteur and now feeds impoverished people for free. (NewKerala.com)

Is there a problem with private-equity funds for the masses? (Barron’s)

Here’s why the IPO market has dried up — and when things will pick up again. (Business Insider)

Australian banks aren’t in as bad of shape as you think, mate. (Bloomberg)

A well-known short seller and part-time chicken farmer known for his high-profile campaign against Overstock.com discusses his long legal battles and admits to sifting through trash cans for clues to a company’s sales volume. (Bloomberg)

Photo credit: Newnow/iStock/Thinkstock

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