If Goldman Sachs bankers are any indication of industry norms, most people on the trading floors of investment banks would like to get out of banking and go into hedge funds. Hedge funds are less regulated in terms of compensation, they are also immune to the Volcker Rule and therefore still able to take proprietary risk.
Fortunately, therefore, some hedge funds are in perpetual growth mode. We highlighted the example of Millennium Capital Partners back in March, when it was hiring bankers. Four months later, it seems that Millennium is still hiring – Bloomberg reports that Millennium has picked up Nicholas Wells, the former head of equities program trading from Nomura and the FCA register reveals that Millennium has added seven people in London since April. They include Benjamin Lane from Deutsche Bank, Patrick Marx from Caxton Europe and Andres Ancer from S.A.C Global Investors Europe.
Separately, Simon Johnson, a former chief economist at the IMF and professor at MIT Sloan, has written a worrying piece warning people away from UK banks. He points out that, ‘a supposedly well-capitalized bank in the UK can have 97 cents of debt per one dollar of assets (and just three cents of equity). Such a low loss-absorption capacity would get you run out of town in the US, where regulators are weighing a 5-6% leverage ratio (twice as much equity on a non-risk-weighted basis), and some responsible officials are still pushing for 10% or higher.’
Even HSBC, Britain’s best capitalized bank, has a leverage ratio of only 4.6% says Johnson. At Barclays, it’s just under 3%. “In a deeply unstable world, these are paper-thin cushions against losses,” Johnson concludes, adding, “At risk is everyone who has a job in the UK, as well as all financial institutions that have significant operations there – including a huge proportion of all global banks.” Cheery.
The UK government is inviting tenders for the privatization of Lloyds and RBS. (UKFI)
Next week, the European Parliament will vote on fund manager pay. (Bloomberg)
Dressed in black tie, Bob Diamond joined B-list celebrities…. (Here is the City)
3,000 new finance jobs were created in Quebec last year. (eFinancialCareers.fr)
210 people went directly from Oxford to live in Kensington and Chelsea in 2012. (ONS)
9,695 graduates work as office juniors, hospital porters, waiters, road sweepers, window cleaners, shelf stackers and lollipop men. (Telegraph)
How successful people talk. (PandoDaily)
Man moves out of banking and into the corporate sector to work in M&A. ‘Patel said his move [out of banking] had piqued the interest of several of his former investment banking cohorts.’ (Financial News)