Morning Coffee: Jes Staley's omen for Jamie Dimon on 'skin in the game.' The bad bit about HSBC's salary thaw

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Jamie Dimon smile

Jes Staley and Jamie Dimon are probably not on talking terms. Staley has, after all, been poaching people from J.P. Morgan for his team at Barclays and did, after all leave J.P. Morgan unexpectedly after once being mooted as a replacement for Dimon. This lack of interaction between the two men is a shame because Jes might have some wise words to say to Jamie on the inadvisability of buying stock in your own employer.

As a reminder, Staley was compelled by the UK banking regulator to buy Barclays' shares worth at least four times his salary when he joined as CEO last November. This, Jes duly did - buying shares worth £6.5m ($9.4m). Since then, Barclays' shares have declined in value by 37%, and Staley has lost $3.4m - equivalent to $35k a day for the pleasure of managing Barclays.

Having just purchased $26m of shares in J.P. Morgan, Jamie Dimon will be hoping he doesn't share Jes's fate. Dimon does, at least work for a US investment bank - J.P. Morgan's shares have 'only' fallen 20% so far in 2016, compared to declines of twice that at banks like Credit Suisse and Deutsche.  Fortunately, there are more promising precedents than Staley. - James Gorman made a similar, if less effusive, gesture at Morgan Stanley in August 2011 when he purchased $2m of stock in the bank - a move which presently stands to have made him around $166k.

The award for the most canny executive stock trade in recent times must, however, go to Lloyd Blankfein. Blankfein sold $22.m of stock in Goldman Sachs last June. At the time, Goldman's stock was close to its highest point since 2007. Since then, it's fallen 34%. Maybe Jamie should carry on ignoring Jes and talk to Lloyd instead?

Separately, HSBC's salary thaw might seem a victory for it's staff, but it's not. As was reported yesterday, HSBC scrapped its salary freeze after staff complained. So far, so workers'-cooperative. - Except HSBC CEO Stuart Gulliver reportedly sent a memo explaining that the present salary increases will have to be paid for out of the bonus pot that would otherwise have been amassed for 2016. With salary increases and bonus payments for 2015 both hitting their bank accounts soon, HSBC's bankers are fine for the moment. This time next year they might wish they'd been less tremulous, however.


Pierre Lagrange, co-founder of Man GLG and one of Europe’s most prominent hedge-fund managers, says there isn't a banking crisis and that “in a lot of cases” share price falls are “completely overdone.” (WSJ) 

Brexit will be bad news for shares (and deferred bonuses) at Barclays at RBS. (WSJ)

As a director-level trader in a hedge fund you will earn an average of £260k a year versus £140k in a bank. (Tally) 

Och Ziff just reported its first quarterly loss ever. (Reuters) 

The mismatch between the advertised “safety” of bank debt and the riskiness of bank assets is what makes the industry profitable and its employees so well-paid. (Alphaville)

Vinod Vasad is moving from Deutsche Bank back to UBS to be co-head of debt capital markets and client solutions coverage for EMEA. (Financial News)

BlueBay Asset Management just hired Jean-Yves Guibert from BNP Paribas and Marc Kemp from J.P. Morgan. Both are high yield specialists. (Financial News) 

30% of fixed income trading jobs in large banks have disappeared since 2011. (Business Insider) 

Nationalize the banks (redux)! (Stumbling and Mumbling)

Time to master the pre-interview chat. (BPS) 

Less attractive people are just as likely as more attractive people to have highly educated spouses. (Research Gate) 

The number of people looking for new jobs in the City of London rose 67% in January 2016 compared to January 2015. The number of new jobs available fell by 1%.  (CityAm)

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