Morning Coffee: Credit Suisse bankers invited to apply for their jobs. Title inflation in the Big Four
Beleaguered Credit Suisse people wondering if they have any hope of avoiding the coming 20,000 or so job cuts are updating their CVs. But not for jobs externally: for jobs similar to those they're doing now, but at UBS.
Bloomberg reports that Credit Suisse's wealth management staff have been invited to indicate their interest in sub-executive level leadership roles at the combined Credit Suisse-UBS entity ('UBS') by Thursday next week. The process reportedly entails the submission of a resume, although you wouldn't necessarily know that from UBS's euphemistic memo on the subject. "Ahead of the selection process and as the two organizations come together, it’s important that we are all as best prepared as possible by showcasing our latest experience and skillset,” says the message from Yves-Alain Sommerhalder.
Unconfirmed reports suggest similar things are happening elsewhere in the bank.
Sommerhalder himself has experience of moving between the two Swiss banks. He left Credit Suisse's wealth management division at the end of last year with aspirations to "chill, relax and recharge" but was summoned back to UBS by Iqbal Khan, head of the wealth management business. He's now head of wealth management at Credit Suisse and is running the integration of the two businesses.
It's not unusual for employees to be asked to apply for jobs in combined entities, but it suggests a different approach to the one being used by UBS previously. - In the investment bank, senior people were hand-picked for potential roles at UBS and then interviewed to establish their suitability. One insider at the bank told us this method wasn't foolproof, however, and that some of the people selected were a surprise.
Separately, as professional services firms cut costs, cut jobs and delay their graduate start-dates, some Big Four firms are reaching for a new method of keeping employees engaged: inflated titles.
The Times reports that EY has promoted 267 people to partner, but that only 112 of them are equity partners who will actually receive a cut of the profits. The remaining 155 are a sort of sub-partner who will presumably have similar responsibilities but less pay.
The Times says the rise of the non-partner partner reflects Big Four firms' attempt to retain staff while simultaneously squeezing costs. EY says it's all about being able to “meet client demand" and being in "a great position to continue our outstanding growth in the years ahead.”
Meanwhile...
The Bank of England is wondering whether to force banks that are currently branches in the UK to set up subsidiaries, with their own capital and liquidity. This is because subsidiaries enable local regulators to seize control of failing banks rather than leaving their fate to the discretion of their parents’ supervisors. However, subsidiaries are more expensive and might put banks off being based in London. (Financial Times)
Private equity is unlikely to bounce back soon. This is because private equity investors are being asked to put cash into funds but are getting little money back. (Bloomberg)
Binance opened a regional HQ in Paris last year, but things aren't going to plan. The Netherlands and Belgium have not proven receptive. Germany, hasn't given it a license to operate. And French prosecutors searched the office as part of an investigation of money laundering controls. (WSJ)
The ECB’s recent fining of Goldman Sachs, for misstating its risk capital, is likely to be used as a lever to oblige banks to relocate more senior risk management executives to the region. (Financial Times)
A JPMorgan employee who says she's “highly credentialed,” “highly educated,” with a “master’s degree” has appeared on TikTok complaining that discrimination meant she got no bonus. (DailyDot)
British Brexit-supporting politician Nigel Farage complained that his bank account had been closed for political reasons. Coutts says it was actually closed because its customers to borrow or invest at least £1m with the bank or hold £3m in savings and Farage didn't have enough money. (BBC)
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