Yesterday, Deutsche Bank CEO John Cryan took to the stage at Handelsblatt’s Frankfurt banking conference. There, he revealed that Deutsche Bank will not be merging with Commerzbank. Nor will it be selling the entirety of its asset management business. It might, however, be selling little bits of its asset management business, and if the UK government has its way, Deutsche’s investment bank will remain headquartered in the City even after Brexit takes place.
In a discussion about Deutsche’s regulatory status in Europe, Cryan informed the conference that Deutsche currently “passports” into London from its headquarters in Germany and that the, “UK authorities are keen” for this to continue in future. In this way, he interestingly suggested that the British government is willing to let banks headquartered and regulated in the EU operate in the City without additional licensing post-Brexit. If so, banks like BNP Paribas will be encouraged to stay in the City too.
If the British government were the only issue, London jobs at Deutsche and BNP Paribas might be secure. But, as Cryan went on to point out, there’s also the unfortunate question of client preference: “Our clients might take us back into the EU because they may demand we transact with them through an EU entity.”
Separately, Conrad Pramboeck, head of compensation consulting at executive search firm Pedersen & Partners, has some harsh words for anyone in banking who thinks their pay might increase again. “It’s clear the industry has been going down since 2008, slowly dying in my opinion,” Pramboeck told Bloomberg. “Currently, it’s still alive, paying extremely high salaries and bonuses, but the whole banking system will have to change. Let’s see how much longer it can go on like this.” Cheerful then.
Why the withdrawal of passporting when the UK leaves the EU could be a disaster: “There’s only one thing about equivalence that really matters and that is that it can be withdrawn at any time. The one-line summary is that passports are permanent, equivalence is precarious. It’s nice to have, you’d encourage the government to get it sorted out, but equivalence is no basis for long-term planning.” (Bloomberg)
Standard Life is looking for someone to help it manage Brexit. (Sky)
Pimco is hiring 20 people in Asia. (Bloomberg)
Cargill traders are planning on launching their own commodities hedge fund, called Twin Harvest Capital Partners (Reuters)
If you come from a poor family, you’ll probably be a better fund manager. But fund manager from richer families are promoted even when their results are sub par. (Bloomberg View)
The secret language of flight attendants. (BBC)
Take the Princeton career quiz. (Princeton Review)