It’s still strategy week. A retinue of Deutsche’s senior managers are still standing up and making presentations in globish about synergies, intimate partnerships, silos, deep dives and so on.
Morgan Stanley has also been laying out its plans for the future. Yesterday, Ruth Porat CFO of Morgan Stanley, made a presentation at BarCap’s financial services conference. Much of this focused on Morgan Stanley Smith Barney, of which Morgan Stanley is now taking full control. However, Porat also included the following slightly incomprehensible chart. From this we deduce that the big sales and trading investment areas for the future at Morgan Stanley are in the green section and are all about electronic trading and central clearing.
Separately, Colin Fan and Robert Rankin, the co-heads of corporate banking and securities at Deutsche also made a presentation this morning. Depressingly, they predicted that European investment banking revenues will grow by 0% between now and 2015, that US banking revenues will grow by around 2% over the period and that Asian revenues will grow 3-5%. In this way, they set themselves in diametric opposition to Gary Cohn at Goldman Sachs, who thinks Europe is where the growth is going to be in the short term.
Fan and Rankin also elaborated further about Deutsche’s plans for the future. The key business areas for investment at Deutsche, shown in the chart below, are: FX, emerging markets and ‘platforms.’ There may also be a little upgrading of staff in European equities.
Anshu Jain has admitted that job cuts at Deutsche will probably exceed 1,900. (Reuters)
Last year, Deutsche Bank employees completed 416,000 compliance and risk training modules and spent twice as much time in compliance training as in 2010. (Deutsche Bank)
Banks in London could be shut down or forced into taxpayer-funded bail-outs against the wishes of the British authorities under controversial “banking union” proposals from Brussels. (Telegraph)
In possible proof that life in the public sector is more pleasant, John Kingman, former chief executive of UKFI who joined Rothschild, is now to the Treasury after 2.5 years as an investment banker. (Financial News)
47 year-old UBS banker blows whistle on the bank’s attempts to help US citizens evade taxes, is imprisoned for 40 months and then receives a reward of….$100m. (Wall Street Journal)
By the end of next year analysts at JPMorgan Cazenove expect compensation at Goldman to average just $314k. That will leave them near the bottom of the top 2% of all U.S. earners. The cut off for the 98% tops out at around $290k. (Fortune)
What do junior investment bankers actually do? (Quora)
The basic laws of human stupidity. (Farnam Street)