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Morning Coffee: Another big post-bonus exit from Goldman; precarious reality of life as an MD in M&A

The M&A MD's constant companion

The M&A MD's constant companion

Now that bonuses have been paid at U.S. banks, employees there are free to flee. As we’ve noted previously, several people have fled Goldman Sachs already – mostly for hedge funds. Now, a senior Goldman banker has quit for another bank.

Financial News reports that Alfred Traboulsi, an MD who spent nine years at Goldman in ‘strategic equity solutions’, has been poached by HSBC.  Traboulsi won’t be able to join the British bank until a period of gardening leave has been completed.

HSBC is reportedly building its equity solutions business. Solutions, which combine traditional equity capital markets products with more complex ‘strategic equity derivatives’ to help solve clients’ financing and hedging needs, are a growth area according to Financial News. Traboulsi’s move from Goldman to HSBC is notable because HSBC is not generally known for generosity when it comes to compensation.

Separately, everyone knows about the travails of junior M&A bankers. The travails of senior M&A bankers are less familiar, but nonetheless real.

William Cohan, a former MD in M&A at JPMorgan, has written an article for the New York Times dispelling the creeping conception that bankers are indistinguishable from Jordan Belfort in the debauched Wolf of Wall Street film.  “My Wall Street was an endless-seeming succession of late nights, ruled by the demands of clients and bosses,” said Cohan. “Mine, too, was the glamour of a red-eye flight to a European capital to meet with the executives of a large corporation.”

Worse, was the insecurity. As a managing director in M&A, Cohan said he lived in a “constant fugue state, rushing from one meeting to the next, constantly hoping a chief executive would pursue the deal I was advocating.” And even when he did get taken on by a client (“a rare moment of drug-free euphoria”), the pressure didn’t relent – it was followed by, “the long downer of sleepless nights as I toiled to make the deal happen.”

In this context, Cohan says bonuses weren’t much of a palliative, being “nothing more than the present value of an inevitable pink slip.”

Meanwhile:

Mark Carney wants bonuses deferred for a “very long time”, but doesn’t say how long exactly. (The Guardian) 

In 1975 finance workers earned £3.8k a year, academics earned £5k. Now, finance workers earn £102k, academics earn £48k. (Financial Times)  

Barclays’s shares fell 8% last week. But investors are happy that Bob Diamond’s testosterone culture has passed. (Financial Times)  

Senior managers of banks in the UK will be guilty of misconduct if a breach occurs in an area of business for which they were responsible under “statements of responsibility” put together for the regulator. (Financial News) 

Another indication that boutiques are likely to pay a high proportion of cash. (Bloomberg) 

Possibly the most sought-after M&A job in the world. (CNBC) 

Why China’s banking system is in trouble. (Telegraph) 

When husbands resign for the sake of their wives. (WSJ)

Are you an elitist? (Seth Godin) 

 

 

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