Spent all last week staring out of the window? Here’s what you missed.
Credit Suisse stunned everyone with the revelation that the performance suggested by its results the previous week was rather more pungent than perfumed. Thanks to “mismarks” by traders in its London structured credit division group, the bank said first-quarter profits would be down $1bn. The Times reported that “a small group of London traders led by Kareem Serageldin” were suspended and the Telegraph said some staff bonuses were cancelled.
Barclays (and Barclays Capital) opened the closet to reveal no nasty skeletons and a fleshy 5% increase in pre-tax profits for 2007. The FT’s Alphaville blog pointed out, however, that trading activity at the bank is becoming less efficient and VaR is rising. The Financial Times quoted Bob Diamond as saying he plans to increase the bank’s client facing people over the next couple of years and expand in North and South America. And, just in case Bar Cap does ever fancy slashing a few staff somewhere, The Times published a little lesson from Paul Idzik, Barclays’ COO, on how to fire people.
UBS cut chairman Marcel Ospel’s term until re-election to just one year after the bank revealed losses of $18bn and said 2008 was not looking very good at all.
Northern Rock was nationalised, but not before various City grandees made a packet out of attempts to avoid just this eventuality. The Financial Times reported that everyone from John Studzinski of Blackstone to David Wormsley of Citi and James Lupton of Greenhill will be getting a share of what The Times reported were 75m in agreed fees – provided, of course, that Darling pays up as promised.
SocGen’s shocker continued to reverberate with the news that the bank missed a mere 75 warnings on Jérôme Kerviel, according to The Times. Meanwhile, the Financial Times commented on the fact that no one’s quite as keen to cosy up to SocGen as was originally expected, and divulged that Kerviel was paid a €60k bonus in 2006, and demanded a €600k bonus for 2007 but was obliged with only €300k.