In the case of Jeremie Banet, something seemed to snap. Banet, a French portfolio manager, ex-BNP Paribas banker and graduate from the prestigious Paris IX Dauphine University, had been working at fund management firm Pimco for four years and was airing his views when he was rudely interrupted by his notoriously brusque boss, Bill Gross. "I never understand what you're saying," Gross reportedly said. "Ever." One day later, Banet quit to pursue his dream: selling toasted sandwiches from a street van in Los Angeles.
Not everyone in finance has an epiphany as pronounced as Banet's. Then again, not everyone works with a boss as demanding as Bill Gross and not everyone works the kinds of crazy hours reportedly required at Pimco. But all around the industry, it seems that people are having Banet moments of their own.
"I left the banking track a few months ago," one ex-Goldman Sachs associate who now works in private equity tells us. "I'd been in M&A for three years and there were only two or three of my class of 25 who were still with the bank. At first, most of my class were leaving for start-ups, but since late 2013 there's been a real pick up in private equity hiring and people have moved into PE instead."
He adds that the work in private equity is more worthwhile than in M&A and that the lifestyle is less extreme. "When I was at Goldman, I was doing 90-100 hours a week and we spent a lot of time working on pitchbooks for deals that never happened." Late last year, Goldman instigated a rule whereby juniors are expected to be out of the office and not working between 9pm on Fridays and 9am on Sundays, but the associate we spoke to said this made little difference to his lifestyle: "The rule was implemented very vigorously to begin with, but in my last six to eight weeks, a lot of exceptions were made. The M&A market is picking up and the workload has risen - it's very difficult to take weekends off when there are important deliverables for Monday morning."
In his case, he said the trade-off wasn't worth it. "I wasn't excited by banking any more. You put in the effort and the hours because the opportunities are good and it pays well. But post-crisis, the compensation has fallen and yet the lifestyle is just the same."
Goldman Sachs didn't immediately respond to a request for comment on its working hours, but while junior M&A bankers complain that they're still too busy, traders everywhere have the opposite problem: they're not busy enough.
"Interest rates are low, credit spreads are tight and equity valuations are really high," says one recently ex-UBS trader who now runs his own investment firm. "Trading volumes are so low that for people who are used to better market conditions, it's a really frustrating time. There's nothing going on. A lot of people I knew have gone to hedge funds."
Within banking, he points out that much of the activity has shifted to the primary markets, with ECM especially having a great year. "The action is all in the primary markets - people in the secondary markets are having a really quiet time and are being smothered by regulation. My ex-colleagues are really miserable."
One ex-MBA student at the London Business School who's just started as an associate at a bank in London, says primary markets are the place to be if you're building a banking career now. "You need to know your limits - I know personally that I can't work more than an 80-hour week and that I don't have the resilience for working in M&A. I'm going into debt capital markets, which offers better opportunities and shorter hours."
Some senior bankers say those who complain that the attractiveness of the industry has dissipated post-crisis are hearkening back to an anomalous episode in its history
"You can still earn more in banking now than you could 25 years ago," says one ex-MD at JPMorgan. "It was only between 2000 and 2010 that things went crazy - top people in the City were earning bonuses of £5m to £10m instead of £1m to £2m. What we have now is a correction from that period, but banking still offers an opportunity to earn far more than you will elsewhere."
When he started his career in 1989, Clarke Pitts, a former equity derivatives trader, says conditions were similar to those we have now. - You had to work hard, and you had to really want to succeed: "The industry was shrinking and hadn’t been profitable for several years. Salomon Brothers had 2,500 applications for 30 spots. I attained a copy of the LSE directory and sent two applications to every company in it – one to the head of trading and one to the head of personnel. I spent my final year at university interviewing and got two offers."
In his first job, Pitts says he often worked until 3am: "I went for several days without eating much because I didn't have time. I suffered from an ulcer and I remember my wife asking if I was sure it was worth it." Ultimately, he says it was: "You could earn good money within five years. That's still the case today. Unless you're very talented, it's enormously more than you can expect to be paid in any other industry."
Meanwhile, Banet may yet find that his post-Pimco food van venture doesn't pan out as expected. However, he demonstrated the first rule of quitting finance for a crazy alternative - never burn your bridges. "I have enormous respect and admiration for Bill Gross," Banet reportedly told the Wall Street Journal, denying that there was any connection between his departure and Gross's outburst. It's notable that most of the current and ex-bankers we spoke to for this article wanted to be quoted on the record - however bad banking is, or was, no one wants to preclude the chance that they might one day go back again.
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