eFinancialCareers

FSA chief Hector Sants has come out of the closet and said bonuses should be taken into account when assessing banks’ risk. But we'd like to point out that it wasn’t his idea. Sants seems to have latched onto a notion first aired by Alchemy Partners’ founder Jon Moulton last week. So how does Jon think the plan Sants has pilfered from him would work? “I presume you’d... Read more

It’s down to regulators to reform the bonus system. And given regulators are powerless to intervene, reform looks as likely as a small village in Hampshire becoming the financial centre of the UK. Regulators are certainly making scary noises. From Mervyn King’s anti-bonus diatribe, to Sir Callum McCarthy’s call for banks to emphasise long-term performance, snarls and grunts about bonuses have been emanating from the regulatory corner for several months.... Read more

It was a good week for hedge funds – unless you were GLG. Banks were still busily lopping staff, although there were rays of hiring in commodities and – strangely enough – leveraged finance. Hedge funds provided reasons to be cheerful. Hedge Fund Research predicted investors plan to pour $200bn into hedge funds this year. ICAP launched an African hedge fund. It emerged that the replica hedge funds... Read more

Will an MBA really do wonders for your banking career, asks George Trower, our resident columnist and banker under cover. The MBA is much maligned. Despite that fact, MBAs are being pumped out in greater and greater numbers and firms are lapping them up offering higher and higher pay packages. In my own experience, a business school gives you all of the following and more: 1. A... Read more

At the risk of being eviscerated and dunked in a vat of scalding Asti Spumante (now that Bollinger’s out of reach), it’s time to say the unthinkable: bankers who find themselves suddenly unable to service enormous mortgage payments have only themselves to blame. The Times last week produced an anecdotal portrait of a new phenomenon – the ‘poor banker’ with a £700k interest-only mortgage acquired in the go-go year of... Read more

Citigroup may be planning to axe more people than Goldman Sachs employs globally, but there are still reasons to be cheerful. The latest survey from PricewaterhouseCoopers and the CBI confirms that general sentiment across the financial services industry is now as low as it was in 1998 and 2003, neither of which were good years for banks. On the other hand, hiring plans appear to be going ahead regardless. Securities traders remain... Read more

Banks could find themselves in hot water over a propensity to assign clients to salespeople based on cultural affinities between the two. Last weekend’s Financial Times carried an article on two former Muslim brokers who are suing their ex-employer, the Swiss stockbroker Financière Tradition, for religious discrimination after it allegedly diverted Jewish clients away from them in favour of non-Muslim colleagues. Lawyers say client allocation could become a hot issue in the... Read more

Which banks and bankers are suffering the most? No prizes for guessing… ACUTE PAIN 1. Merrill Lynch Share price: down 44% since January 2007. Bonus per head*: $181.3k, down 25% on 2006. Net profit for the first nine months of 2007: $1.9bn, down 61%. Redundancies: none announced so far, but exit of chief exec Stan O’Neal is imminent. 2. Bear Stearns Share price: down 38% since January 2007. Bonus per head*: $407.6k, down 20% on 2006. Net... Read more

Spare a thought for the classes of 2007 and 2008. It seems investment banking jobs are proving hard to come by. A student at a leading European business school says banks are still coming to present on campus, but that with the exception of Credit Suisse, few appear to have any full-time places left for 2008: “Places have already been filled by last year’s summer interns. If you missed the boat... Read more

Most people sit around passively waiting for the pink slip. Has Stan O’Neal gone for pre-emptive action? Ever since Merrill revealed a $2.3bn 3Q net loss earlier this week, there have been calls for Stan to step aside. Now the New York Times says Stan’s head has moved closer to the block after he allegedly broached a merger with Charlotte-based Wachovia without first getting the approval of Merrill’s board. Putting aside the... Read more

What’s happening, who’s hiring and how much are they paying in the world of inter-dealer broking? What’s the temperature? Hotter than a barbeque in the Sahara. The headline-hogging inter-dealer brokers (IDBs) have been smugly claiming that the current market volatility makes them a sanctuary from sub-prime. ICAP, the world’s biggest IDB, has seen a ‘sharp increase’ in activity in the last three months (according to the Financial Times), while the industry’s number... Read more

Rising taxes and falling returns are taking their toll on the co-investing craze. “The amended capital gains tax rules will impact people participating in company co-investment schemes that qualify for business taper relief,” says Chris Sanger, head of tax policy at Ernst & Young. “Assets disposed of before 6 April 2008 will be taxed at 10%, while those disposed of from 7 April 2008 will be taxed at 18%.” Co-investing is nothing... Read more