Boutique investment banks aren’t just getting in on the big advisory deals, they’re doing it with tiny teams of very senior, well-connected people and securing some enormous pay days.
Around £200m ($266.5m) in fees was paid out to investment banks, law firms and PR firms for advice on the £24.3bn purchase of UK microprocessor designer ARM by Japanese tech giant Softbank yesterday.
Among the three banks advising Softbank, which collectively received £45.2m ($60m), was Robey Warshaw. Average payments were therefore £15m ($19.9m) – of course, it’s a big assumption that all the banks received the same amount. But, around 20 staff at the bank advised on the deal, suggests the FT, and just three partners will be the main beneficiaries of the fees.
Even better, this the whole thing took around a fortnight.
Separately, how can you be Brexit-proof as an investment bank in London? Well, if SocGen is anything to go by, just don’t base many staff there or become too reliant on the UK for revenues.
The chart below shows how SocGen’s London headcount compares to that of its investment banking peers. It says it has a lower proportion of investment banking employees in London than any of its peers, at around 10%. Morgan Stanley and Goldman Sachs have among the highest numbers employed in London, it suggests, but one European bank – presumably Deutsche Bank, which has around 7,000 people in the City – leads the way.
SocGen has, it says, an “up and running Paris-London dual set-up (both front office and operations)”, which suggests single market access isn’t a problem.
This echoes comments from Deutsche Bank CEO, John Cryan, that most of its London functions are carried out through its German-based subsidiary anyway.
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