Remember Tian Zeng? He's the credit index trader who was let go by Deutsche Bank for discussing 'market color' with his clients. Eyebrows are seemingly being raised at Zeng's disappearance immediately before bonus time: he was one of the best performing members of the credit trading team.
Zeng's FINRA record shows that he was let go by Deutsche Bank on 25 February after an internal review. The review concluded that, 'the employee's conduct violated Firm policies, including with respect to confidentiality and external third party communications.' Bloomberg reported this week that Zeng was let go after it was discovered that he chatted to a client about a trade made by Credit Suisse's credit swaps desk.
Deutsche Bank announced its bonuses for 2018 on 6 March - exactly one week after Zeng was removed. Skeptical DB insiders suggest the departure was conveniently timed to enable Deutsche to avoid paying the trader his 2018 bonus, and that there is no explicit mention in the bank's handbook of a rule that employees must not discuss competitors' trades.
Deutsche Bank declined to comment and Zeng did not respond to an attempt to contact him. It is not clear whether Zeng intends to pursue his bonus in the courts. Zeng was part of the credit trading team run by Paul Huchro, the veteran Goldman Sachs credit trader hired by Deutsche Bank in 2017. It is understood that Zeng's personal pnl in 2018 was approximately +$20m, while the business as a whole made a loss, and that his bonus was expected to be substantial even while other traders at Deutsche had their bonuses cut this year.
Zeng joined Deutsche Bank in October 2017 after previously working for Citadel Securities, where he was the head of credit trading. Traders who join banks from hedge funds are still often offered 'percentage' deals for their pay, with up to 10% of pnl being standard.
There have been various departures from Huchro's team in recent weeks, including Dan Znaty in investment grade sales (who joined Barclays on 27 March), Michael Lattarulo (also in investment grade, who is understood to be joining Credit Suisse), Richard Joyce (the head of investment grade sales), and Nikhil Khosla (a research analyst who is thought to be going to the buy-side).
Deutsche has also hired several managing director (MD) level credit professionals this year, including Sylvain Lebre (London), Bret Corrigan (New York), Manav Gupta (London, joining from Goldman Sachs), Olivier Gazzolo (London) and Drew Meany (NY).
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