Morning Coffee: Young consultants idle on $175k as bankers pull 80-hour weeks. A shock for UBS bankers

If you want to know how working hours in investment banking have evolved since the 2021 Goldman Sachs analyst presentation complaining of 100 hour weeks, the forum website Wall Street Oasis is a good place to look. According to a recent thread there, things are better, but not by much. 

There are no mentions of Goldman Sachs in particular, but writing on WSO people at 'large US banks' say 80 and 90 hour weeks are still common, that protected Saturdays are still protected but that Sundays are like a standard working day. "We are still pulling 90-hour weeks on average in my group because we're pitching for everything under the sun," complains one first year analyst. Alongside rampant pitching, he/she says they're engaged in "boil-the-ocean strategic reviews" analyzing every M&A target and every potential buyer for clients and their divisions, even when the clients don't have the intention or ability to execute.  

In other words, many young bankers are still busy - even if the work they're doing seems semi-pointless. Many are also back in the office, full time.

In elite consulting jobs, things are different. The Wall Street Journal says elite young consultants, many of whom were recruited on $175k packages after completing top MBAs, are now idling at home. They're watching Netflix and Amazon Prime, sleeping, shopping, exercising and going out for walks. And they're still getting paid. 

In consulting terms, this is known as being "on the beach" or "on the bench" and simply means you're not staffed on a client deal. You don't go into the office because you're not needed. You don't get let go because consulting firms are fearful that business will come back. “At any point, if we stop recruiting and if we stop hiring, we feel the impact for the next six to eight years,” McKinsey's managing partner for North America told the WSJ.

For the moment, then, young consultants can simply chill. For some, it's a welcome rest. For many, though, it's not easy. Boston Consulting admits that it selects the "most hard-charging people," for whom idleness is an anathema. Although they're getting paid well for doing nothing, many of the juniors the WSJ spoke to said they're already applying for new jobs. 

Separately, UBS bankers who thought they'd be safe in the merger with Credit Suisse haven't been paying attention. Sergio Ermotti said several weeks ago that some UBS bankers would be let go in the transition, and Reuters reported yesterday that this is coming to pass. But it's not just Credit Suisse bankers who are replacing them.

UBS has famously hired-in various MDs from Barclays, and they together with recent recruits from Bank of America and people from Credit Suisse are taking some incumbent MDs' jobs. While many Credit Suisse people are leaving, so too, therefore, are UBS veterans like Jeff Rose, global head of the consumer team, and Matt Eilers, global head of financial sponsors. 

Meanwhile...

Point72 has grown its Singapore team by more than 50% since early 2022 to 100 people. (Bloomberg) 

Citadel is having the best 2023. Its flagship Wellington fund is now up about 8.6% for the year. Point72 is up 5.8%.  Verition is up 4.1%. Millennium is up 3.5%. (Business Insider) 

Metals traders who joined hedge funds are now leaving again after poor returns. (Bloomberg) 

The Saudi Public Investment Fund made a $15.6 billion comprehensive loss for 2022 after the value of its investments in SoftBank Vision Fund plunged and other tech ventures plummeted. (Bloomberg) 

Goldman Sachs has room for all its interns. "The honest truth is, we've got capacity for everybody," he said. "We don't come in and say, okay there's 24 of you, there's room for 15, and draw a hard line. People don't think it's true, but it is true." (Business Insider) 

Intern salaries in investment banks are stuck at $100,000 and $110,000 pro rata, or $52-$54 per hour. (NY Post) 

It's not easy working for a Chinese bank in China. Local brokerage analysts and researchers at leading universities as well as state-run think-tanks say they have been instructed by regulators, their employers and even domestic media outlets to avoid speaking negatively about topics ranging from fears of capital flight to softening prices. (Financial Times) 

Revolut is closing its US crypto operations due to a difficult environment. (Decrypt) 

The whistleblower whose pursuit of justice took over his life. “It’s all the things we believe or hope are true as children—that eventually the rightness of what they say will be recognized. When that doesn’t happen, or even when it does, the whistleblowing becomes their world.” (WSJ)

Your hands are heavier than you think. The average hand weighs about 400 grams, but the people in the study underestimated their hand weight by 49.4 per cent on average. (New Scientist) 

A guy who I met in the club told me the craziest rave stories. Then I realised he was also working in an embassy. (Vice) 

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