So you want to leave banking? – To use your time in finance to accumulate the capital that will function as a stepping stone to something else? – Maybe to fund that financial services startup you’ve been pondering? If you’re going for the latter, you’ll need money. Lots.
The Wall Street Journal reports that, ‘the average initial investment for finance-industry startups is at least $2m [£1.34m], before employee costs.’ That’s a lot of accumulated bonuses. As a result, many of the bankers escaping to Startupland are in their 50s. They are also being forced to cash-in the sorts of trophy houses and trinkets that bankers of a certain age have come to expect. Gerry Cardinale, former co-head of Goldman Sachs US private-equity investing business, sold his house in the Hamptons and started taking the New York subway. “It was like going back to being 26,” he reflected.
Separately, the happiest M&A banker at Goldman Sachs is possibly a woman based in London. Karen Cook, a London-based partner and the so-called ‘Queen of M&A‘ reportedly landed Goldman its key role as advisor to BG Group in its sale to Royal Dutch Shell. The sale is expected to net Goldman up to $90m in fees, some of which must be shared with boutique firm Robey Warshaw. Mark Sorrell, co-head of U.K. investment banking at Goldman is also working with Cook on the deal.
Cross-border European M&A is booming thanks to the, ‘euro’s decline against the dollar and renewed confidence in an economic recovery.’ (Bloomberg)
J.P. Morgan is using new predictive monitoring algorithms to assess when employees will contravene compliance rules. (Bloomberg)
The purpose of J.P. Morgan’s algorithm is not to minimize legal costs, but rather to optimize them. (Bloomberg)
Diego De Giorgi and Karim Assef are the new co-heads of global investment banking at BAML. De Giorgi is a Goldman Sachs veteran who joined in 2013, Assef has been with BAML for 20 years. BAML wants to grow investment banking in Latin America and to invest in infrastructure finance. (Financial Times)
Nomura thinks that J.P. Morgan and Goldman Sachs will do well in the first quarter: ‘Banks with more currency exposure, such as J.P. Morgan and Goldman, should be among the largest beneficiaries [of strong FX trading]. Firms geared toward spread products, like Bank of America and Morgan Stanley, should deliver less impressive results.’ (WSJ)
Barclays is ‘reshoring’ jobs and hiring 200 people for a Sunderland anti-fraud centre. (Financial Times)
Indications that you need a new job. (HBR)
Equity analyst career risk. (Twitter)