JPMorgan's corporate and investment bank (CIB) didn't have a good third quarter. Despite this, it hiked its third quarter compensation ratio and said it was increasing pay. Celebrations would be premature, however.
Although the third quarter went well at JPM's investment bank from a pay perspective (if nothing else), Bloomberg helpfully points out that compensation for the first nine months of 2014 was actually down 3% at JPMorgan compared to the previous year. Between January and September 2014, JPMorgan accrued $262m less to pay its corporate and investment bankers than it did over the same period one year earlier. Worse, deeper pay cuts may be necessary in the fourth quarter - the return on equity in JPMorgan's corporate and investment bank collapsed from 18% in the first nine months of 2013 to 12% in the same period of 2012 and the bank is facing steep fines for its role in the FX fixing scandal. The third quarter looks like an anomaly. Pay at JPMorgan's CIB is almost certainly going to decline. Bad luck.
Separately, it seems that FX traders in London are being summoned to ominous interviews to discuss their role in the FX fixing affair. The Financial Times reports that Richard Usher, JPMorgan's former chief currency dealer in London, quit the bank after refusing to take part in 'last minute internal interviews' ahead of the bank's settlement with the UK's Financial Conduct Authority (FCA). At the same time. the FCA has reportedly been conducting additional interviews of its own. Referred to by the FT as 'forced interviews' these FCA interrogations aren't elaborated upon but don't sound pleasant. The FT says Usher didn't have to submit to one because, 'US authorities find material from compelled interviews legally tricky to use.'
JPMorgan's 32% compensation ratio in the corporate and investment bank is a lot lower than its peers. If Goldman Sachs' compensation ratio were this low, its return on equity would be 4 percentage points higher. (Breaking Views)
Jamie Dimon has finished his throat cancer treatment and is now easing back into his, 'full travel schedule'. (Guardian)
Citigroup said September was a strong month for FX trading. Securitized products have also been strong. (Wall Street Journal)
Credit Suisse has reshuffled its investment banking in EMEA and wants to hire some more M&A bankers soon. "“We are definitely looking to add some coverage and M&A bankers. It is very selective hiring but we very much see this M&A wave continuing,” said Mark Echlin, co-head of M&A in EMEA. (Wall Street Journal)
Deutsche is urging its women to "be bold" in pursuing career opportunities. It wants to promote more of them. (Financial News)
The most powerful woman in finance got her job through nepotism. (MarketWatch)
New employee perk at Apple and Facebook: egg freezing for females. (Guardian)
How to use body language to get what you want. (Inc)
How to handle information overload in CFA Level 1. (LearnSignal)
Bedazzled Mercedes. (Instagram)
How idiots mess up Morgan Stanley applications. The forgotten cabal within Deutsche Bank
How Colin Fan is keeping traders at Deutsche Bank. London bankers can’t afford 2nd child
CFA Institute releases information on June exam horrors. Big bonuses at Morgan Stanley?