Morning Coffee: Lean, mean Deutsche bank dangles big pay to attract and retain staff. Senior banker seems to accept buy-back

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It's a whole new world at Deutsche. The German bank, which is under new management, has begun blaming its recent feeble performance on a preponderance of poorly-performing staff, whom it's now committed to getting rid of.

Mark Fedorcik, the newly-promoted co-head of Deutsche Bank's U.S. operations, has been giving interviews setting out Deutsche's new ruthlessness, which he says is welcome to the bank's U.S. employees.

People who remain at DB should feel encouraged by the overhaul, Fedorcik told Bloomberg: "You’ve got to make decisions to shrink where you’re not efficient.” Deutsche is going to be more like Goldman Sachs, Fedorcik told the Financial Times: it will be “doing a much better job on a systemic basis at looking at the underperformers.” This is to be embraced: “People want to be focused, they want to see the bottom performers taken out," he added.

How many bottom performers are there at Deutsche Bank? Previous suggestions that Deutsche will be cutting 20% of its U.S. staff appear to have been overdone. 'People familiar with the bank's plans', told the FT that 10% of the bank's remaining 9,900 U.S. staff (400 have been cut already) could go in a cull. Thereafter, the feeble will be weeded-out at a rate of 5% per year.

Whilst hacking away at its flabby underbelly, Deutsche will be selectively adding muscle to its U.S. business. Last year, Deutsche hired-in over 30 managing directors (MDs) from elsewhere. This year, Fedorcik says it will be hiring,"here and there." However, the FT notes that people will likely require a significant financial inducement to join DB's U.S business in these uncertain times, and quotes a recruiter who says the bank's already been offering, "aggressive compensation packages to recruit people.”

Fedorcik also suggests that Deutsche will also be waving its cheque book at high-performing staff whom other banks want to poach. “We will defend them to make it almost impossible for them to leave,” he told Bloomberg.

Lean, mean - and high paying.

Separately, following, our article last week from a recruiter intoning people never to accept buy-backs, Deutsche Bank doesn't seem to be the only place offering them. Business Insider reports that Tammy Kiely, a top semiconductors banker at Goldman Sachs who was going to be joining Morgan Stanley, has changed her mind and will be staying at Goldman Sachs after all. It's not clear what made Kiely stay, but it's fair to assume that Goldman really didn't want to lose her.


Deutsche Bank named John Pipilis head of fixed income. Former head of fixed income, Ram Nayak, is now a co-president of the bank and will focus on cost cutting. (MarketWatch)

Tom Patrick, the head of Deutsche's U.S arm is still happily employed by Deutsche Bank. This is despite an 'at times contentious' relationship with the new head of the investment bank, Garth Ritchie, who feels Patrick didn't do enough to grow equities. (Bloomberg) 

Chris Berthe is the new man to know in J.P. Morgan's equities business: he now heads much of the bank's electronic equities trading. (Bloomberg) 

Jes Staley's "serious errors of judgement" were enough to incur a fine equivalent to (only) 10% of his annual income. (Financial News) 

Talent shortages in compliance: recruiters say it is hard to find “early career” candidates with five to seven years‘ experience who earn £50k ($67k) to £80k ($108k). (Financial Times) 

BlueCrest CEO Michael Platt added another $812m to his fortune last year. (CityAm)

Ex- AIG risk modeler who is now a Yale finance professor is still touchy about the financial crisis. "Just reprint the old crap... [anything you write will not be] accurate except within your understanding of the crisis. Basically you don’t understand the crisis.” (WSJ) 

Ineos CEO and UK's richest man: "The venture capital world is very simple, really...If you do bad deals, you get fired. If you don’t do any deals, you get fired." (The Times)

UBS is hiring senior bankers in Saudi Arabia. (GulfNews)

The worst way to earn $1.4k a day. (Altas Obscura)

Run crypto conferences. Make your fortune. (CNBC)

Newly promoted Goldman VP quits without collecting bonus to join crypto mania. "I don't regret it at all...It's been the most exciting few months of my life, honestly.'' (CNBC) 


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