Morning Coffee: The former Credit Suisse trader who might rescue his ex-colleagues. Michael Klein's quiet comeback
As Credit Suisse traders contemplate extinction, a former member of their tribe could yet come along and rescue them.
Bobby Jain spent 20 years at Credit Suisse, where he was variously the bank's global head of asset management, co-head of global securities and global head of proprietary trading across both equities and fixed income. Since leaving CS, Jain has spent the past eight years at hedge fund Millennium Management, where he was co-chief investment officer, but now he's leaving and may be setting up a multi-billion dollar hedge fund of his own.
52-year-old Jain could conceivably emerge as a saviour for the Credit Suisse traders who are unwanted by UBS. Bloomberg reports that his putative multi-strategy hedge fund - which is still at the 'consideration' stage and has yet to be named or confirmed, might be bigger than ExodusPoint, which was launched with $8bn in AUM and had 108 portfolio managers at the start of last year, plus support staff. Jain is due to leave Millennium in the middle of this year and the new fund isn't likely to launch until the second half of next year, but Bloomberg says he should be free to start finding office space and hiring people from July....
The ray of hope comes after Credit Suisse released some painful first quarter results this morning. However, amidst the $68.6bn of asset outflows and the $347m loss in the investment bank alone, is something that doesn't look too bad. - Revenues in Credit Suisse's fixed income trading business fell by the merest 5% year-on-year in Q1. This compares favourably to - say - the 17% decline in fixed income revenues at Goldman Sachs or the 12% decline at Morgan Stanley. It's a reminder that some of Credit Suisse's remaining traders might not be too bad. Jain might want to take a look.
Elsewhere at Credit Suisse, the M&A and capital markets bankers didn't acquit themselves as well as the fixed income traders in the first quarter. M&A advisory revenues were down 63% year-on-year in the first quarter, and capital markets revenues were down 45%. This is a shame given that their particular parachute in the form of Michael Klein's CS First Boston has been "terminated" by mutual agreement according to today's results. It's not clear whether Klein got an exit fee, but he's still hard at work. Bloomberg reports that he's been spied advising Glencore, whom he's worked with before, on its $23bn bid for Teck Resources plc.
Santander is in talks to hire David Hermer, Credit Suisse’s global head of equity and debt capital markets and Malcolm Price, head of coverage and advisory and global head of financial sponsors coverage. (Financial Times)
Deutsche Bank plans to reduce its executive board to nine members from 10 and to cut some jobs in infrastructure and in its private banking business to save costs. (Reuters)
Deloitte says it's "taking modest personnel actions" and cutting 1,200 jobs in the US. (Financial Times)
Moelis hired Antje Gaensler from Lazard. (Financial News)
Blackstone says it's a golden moment for private credit, which is benefitting from higher interest rates and wider spreads. (FT Alphaville)
Mary Erdoes, the head of JPMorgan's asset and wealth management business, allegedly made visits to Jeffrey Epstein's New York home in 2011 and 2013. (Financial Times)
Alphabet CEO Sundar Pichai was paid $226m for last year, mostly in the form of an enormous stock award. His pay arrangements were conveniently finalized before Google started cutting costs. (Financial Times)
A recruiter was paid $135k at Microsoft for a 35-hour week and then $200k at Meta, where there was almost nothing to do at all. (Independent)
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