BOA/Merrill vs. Barcap/Lehman
Now that the market has seen signs of stabilization; where do you see these newly merged BBs 2-3 years from now in terms of 1. Market share, be it M&A or Global Capital Markets 2. League Table Power (deals) 3. Prestige and Brand Recognition.
Would be interesting to hear some thoughts as the industry dynamics have changed. Although the acquisitions were entirely different; one a steal from the Brits, the other a forced "murder", both BBs seem to be well positioned for the future... thoughts?
Barcap/Lehman seems like it will emerge quite strong. BOA/ML seems exactly the opposite. They have been losing MD's and exec's left and right. Their prestige will never be the same as the ML days and their league power standing is only because of the sheer volume of deals that they share.
Barcap/Lehman is emerging stronger.
BoA/Merrill is f-ing up hardcore. Expect to see more bankers run for the hills.
The main reason for BOA/ML screwing up right now is the government intervention/public criticism aspect, which will subside eventually
I think it is granted that alot of BOA's troubles are related to it's governmental control, but even after they pay back the TARP and escape from executive comp. restrictions, they will have already lost heaps of senior bankers and rainmakers. I understand that banking is a cyclical industry...but I have a hard time seeing how BOA/ML is going to make a significant recovery, particularly given BOA's reputation on the street as a place to work.
BOA's problem isn't so much gov't intervention, I think it's in the CEO office. Ken Lewis has made an idiot of himself, and there are no clear front runners to take his spot. Future looks dim for these guys unfortunately.
I can see BOA/ML looking like Citi did a few years ago - not a high-flying place, but where you can get good experience before leaping to another field. Don't forget that Lehman had significant losses of its top people, but Barclays obviously got a much better deal.
Also, another quick question - why does it seem that most of the defections at BOA are in the IBD, but not in S&T or Global Research? (I've been following pretty much all the news and can't seem to understand why) While the percentage of IBD senior MD's leaving is significant but still relatively small (probably 20% by the time this wraps up)its a much higher proportion than in other front-office divisions.
In fact, relative to banking, ML was higher ranked in research than it was on the league tables...so why aren't top analysts departing like a few of the top bankers?
Is it because bonus pay in IBD is more discretionary or what? Can't really think of a reason. I even thought about it for like 10 solid minutes while at work.
@Big Unit - Assuming that your assumptions are correct. I would guess that it is due to the fact that bankers have options, such as restructuring or smaller boutiques. Whereas S&T and research is being downsized at BB's, and there only other option, hedge funds are also being downsized and aren't hiring. I think that they simply have fewer options compared to IBD at least for now.
Yeah thats a good point. My assumption is based on just the news I've been reading and word on the street. ML Global Research, at least, has largely stayed put (though a few defecions to Bar/Leh have occurred in Latin America by some senior people). This is surprising given that salaries are usually somewhat tied in front-office roles (in terms of correlation) and that its research was the strongest on the street, along with Lehman.
For S&T, there isn't much news flow on personnel shifts period. If anyone has differing opinions please share. I likely only have incomplete information compared to many of the people on this board who work at either company.
Haha...to summarize my poorly worded question (did it on BB):
Barcap's Q1 confirms the above inquiry: they simply crushed it.
Wow, nice.
Unde dolores ex non in architecto voluptates. Explicabo mollitia laudantium qui voluptas sed unde expedita. Accusantium quas laudantium deleniti et tempora asperiores.
Est nulla delectus vitae quod qui quia. Optio nihil sapiente dolores eos eos sapiente. Corrupti esse assumenda autem quidem. Inventore magni ea esse harum quo magni. Illum minus vitae quo iste.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...