Move along: there is nothing to see at Macquarie Capital. Nothing to see at all. Earlier this week, the Australia bank said trading conditions in its capital markets, commodities and financial markets units have improved. Full year profit should be in the upper end of the previously forecast range. Macquarie's shares are up 6% since Friday.
Except...Except, it has come to our attention that several persons have left Macquarie Capital in London over the past two months. It's not clear whether they went voluntarily or were compelled to go. But several senior, mid-ranking, and analyst/associate level Macquarie bankers are no longer with their employer.
The exits include Julian Wentzel, formerly head of cash equities for Europe at Macquarie. Wentzel left the bank on December 31st according to the Financial Conduct Authority (FCA) register, after reportedly quitting last September for personal reasons. Robert Joynson, a senior transport analyst, has also left. So too has Alexander Kyriakopoulos, a power and natural gas analyst and experienced power trader. Duncan Farr, a former head of financial institutions group (FIG) sales, left in November - ostensibly for Nomura, but has just turned up at Jefferies.
Macquarie has also lost senior and junior staff from its investment banking division (IBD). Steve Baldwin, ex-co-head of equity capital markets (ECM) and ex-co-head of corporate broking, is 'taking a break from the industry.' Mark Freestone. a vice president in ECM, has gone. Alex Wotton, a director in power, utilities and infrastructure, left for Nomura a few weeks ago. Late last year, several of Macquarie's IBD juniors (Kevin Ngai, an analyst, Habib Barakat, an associate, Michael Forrester, an associate, Jae Park, an analyst, Julian Merheb, an associate) quit for rival firms and infrastructure funds.
Why? Macquarie declined to comment. However, insiders said Macquarie is adding headcount and M&A headhunters cautioned against reading too much into the exits: "There's simply a lot of movement in the M&A market generally right now," said one M&A headhunter, speaking on condition of anonymity. "And Macquarie is going to suffer in particular from the increase in recruitment at infrastructure funds." Another pointed out that Macquarie has been hiring as well as firing: Dipesh Patel joined from Espirito Santo to replace Wentzel, for example.
While most banks pay bonuses in January and February, Macquarie's investment bankers have to wait until early May to get paid. This makes any departures at this time of the year unfortunate. Several years ago, Macquarie's bonuses were reportedly low for junior M&A bankers. This year's trading statement suggests 2015's bonuses should be better. Macquarie's European investment bankers have certainly worked harder than before. Dealogic figures show that Macquarie ranked 27th for M&A and 62nd for ECM in 2014, up from 40th and 98th respectively one year earlier.