BofA Spiraling?
Here’s what I hear is happening:
- People are leaving in droves (mostly associates and VPs) due to the shit pay. Took a few months but finally a lot of people have left or are leaving. As expected, the high performers are burning out and leaving, and the less talented ones are hanging around collecting checks.
- The groups with the most exits are the sweatiest groups with the most deal flow (M&A, healthcare, industrials, energy) that actually need people. By contrast, no one is leaving the slower groups (C&R, TMT, etc) due to a lack of deal experience and easy life. Basically the groups are bloated in all the wrong places
- M&A is so jammed that their juniors cannot work on anything that’s not a live deal with fees over $5m, putting even more strain on coverage groups who need to single handedly run all of the dinky M&A carve-outs the bank is for some reason targeting.
- Tons of EGRC senior bankers bringing in 0 deals who need juniors to do their work. EGRC juniors are playing pretend banker / don’t know what they’re doing so the coverage teams end up doing more work for more MDs and stretch themselves even more thin.
- The associate’s death and overall sweaty nature of the group (due to the facts above) is killing morale.
- People are quitting non stop and it’s creating a hamster wheel effect, no one wants to end up holding the bag when the music stops.
Can anyone at BofA confirm?
Basically yeah
What is EGRC?
Forgot what it stands for, but believe it's their regional / mid market IB teams
Emerging Growth & Regional Coverage
Isn't it like that at most banks? The groups that don't produce are the groups with easy lifestyle and great pay (bonus drawn from sweatier pool) so they have no incentive to leave. I think bloated at the wrong place happens at so many non-hardcore banks (hardcore on the other hand is defined as GS/MS/MOE/EVR)
Not at BofA but generally, the unfortunate reality is no one is hiring a bank for their junior employees. It will be a big headache for seniors to not have adequate support, but life will go on. Maybe they'll have to draw out pages and have the graphics team type it up or they'll have to be more thoughtful about what they ask, but they'll make it work.
M&A team wouldn't want to work on tiny mandates at any bank. Doubt this is a bad thing or specific to BofA
Is EGRC that bad? Is going to a mid tier MM like stifle better?
Way better
Did you mean EGRC is way better or Mid tier MM (stifle/WF/HW) is better? Trying to decide for better overall IB experience / deal exposure / exit ops?
yep it's bad
Any chance of lateral opportunities starting to open later this year? I’m an incoming first year at an MM that’s looking to leave ASAP
Bro is dropping bombs over here. I for one cannot believe the best groups at BofA with the best deal flow also have the best exits. Please continue providing earth shattering revelations, this is the content we need.
Meant the groups where the most people are quitting are in the sweaty groups, they’re not necessarily the groups with the best exits. Know a bunch of people who quit these groups with nothing lined up, left the finance world entirely, or went to a less prestigious bank… not necessarily great exits.
The group also basically has no sponsors team anymore. All the group heads left and there are almost no senior bankers left in the group. The bank is trying so hard to strengthen sponsor related relationships and deals… news flash when you don’t provide financing you won’t build trust or relationships with sponsors.
Then Levfin is terrified to provide financing because a bunch of (good) senior bankers got canned in 2022 after the Twitter deal etc, so their one competitive advantage (their balance sheet) isn’t being utilized.
Bank is wasting a ton of time, money, and resources going after all of these tiny sellisides, carve-outs, etc that are a huge pain in the ass and like $2m in fees. Trying to compete with the likes of Blair and Baird while using a bunch of scrub resources in EGRC, basically all the underperforming knuckleheads who got siberied from coverage
- Bank hired like 8 million MDs and will undoubtedly brag about top 3 market share. Doesn’t mean much when you have 4x the senior bankers as Goldman etc.
- All of this leads to 80+ hour weeks for juniors while getting paid significantly below street, hence the accelerated exits. Sure clients probably don’t care much about junior bankers but stripping away the bank’s pipeline of talented mid level and future senior bankers can’t be good
- A big difference between BofA and the other banks is BofA refuses to lay off underperforming juniors. Other banks thin the herd every now and again, which keeps pay at a reasonable level and facilitates more even allocation of work. When you keep around shitty juniors that no senior bankers want to work with, these people don’t get deal experience so they can’t leave and they hang around longer than they should collecting their base. The “sewer” of buffoons gets bigger and bigger every year, and the competent juniors get stretched so thin since a larger proportion of juniors are not pulling their weight. See “BofA List”
There’s some knowledge for you. By all means come to BofA though
Oh I misunderstood. I saw “exits” and immediately interpreted it as exit opps which is how that phrase is often thrown around. You meant exits as in quitting, which now makes the point make more sense. Thanks for clarifying.
Would say you don’t understand the committed financing process… it is a collective decision on whether to use the balance sheet from credit, risk, capital commitments, etc. Not a LF sole decision. That said, the amount of crap deals coming through the pipeline with investment banking teams that cannot tell you what the company does is laughable.
Why do you think BoA does not thin out the herd of low performing bankers a la GS?
If you’re at BofA and of decent competence (especially senior associate or senior VP), leave ASAP. You are NOT going to get paid. Mgmt too busy subsidizing for the massive pool of lackluster A&As, paying all the MDs that don’t actually bring in business and shoving this whole EGRC concept in your face. If they trimmed that fat like they do at all your competitors, the bucket would be much bigger.
Saw they poached a partner from PWP tho recently?
Heard that the partner was let go from PWP, didn’t do a single deal there.
The first two issues here seem to apply universally to most “undesirable” banks.
What happens is this… below-street pay due to misplaced bloat in under-utilised groups stemming from a refusal to “thin the herd,” which also makes hiring difficult in higher-performing groups (leaving them understaffed), forcing these high performers out. This, in turn, “thins the herd” by pushing high performers out (rather than low performers out), hollowing out the talent pipeline.
As such, the bank becomes extreme disparate in terms of lifestyle. I think BofA will be alright because of its name brand, but banks without much of a brand are going to experience difficulty attracting talent with this problem.
The intuitive solution is to cull down low-performance groups, reward performance with high pay,
Agree. I think the only solutions are to:
1) Be very vigilant monitoring low performing groups, and swiftly & proactively cut back when things slow down
2) Make the bonus pools for strong groups SIGNIFICANTLY higher than weak ones, even at the junior level
Low performing groups essentially had a vacation these past 2 years while the ones carrying investment banking are getting cranked and being paid way below street.
Agreed. And, to be clear, it’s not necessarily the case that low-performing groups are full of incompetence…often, it’s just that they’ve hired five analysts to do two analysts’ worth of work. Regardless, there needs to be massive re-allocation among still-malleable juniors…or cuts among those who haven’t been pulling their weight and haven’t expressed a desire to expand responsibilities. No more free riders who don’t, at a minimum, express some discontent at being free riders. Why would free riders want to voluntarily ask for more? That’s where the less equal, more meritocratic division of bonuses comes in.
How has the culture been in ECM / DCM / LevFin? Heard there were cuts across all 3 in last 6-12 months, morale pretty low.
Bump
LevFin had the worst cuts out of this group by a wide margin. Cuts occurred in the other 2, but nothing that could be described as broad.
It sounds shitty but frankly consistent with any bulge bracket. Nothing special
Can anyone in TMT confirm that it's not sweaty? Yes, there are no deals in software, but I feel like it's been pretty sweaty mostly because MDs find way to make anything sweaty. I know it's been sweaty for some at least
Not in TMT but can confirm. Worked with them on a few pitches/deals and their teams always consist of like 2 analysts and 2 associates, relative to 1:1 on our side. They whine and think it’s “sweaty” when they have to work past 9pm. Seems like a completely different world. Same deal with consumer… these groups also have 60+ A and As and bring in laughably few deals
Yeah that sounds annoying, although assuming this is NYC? Not sure how different Palo Alto team is from NYC. Have also seen M&A and lev fin put two analysts on some accounts, so can't say product groups don't do the same. Two analysts sounds like a characteristic of BofA's important accounts, but two associates just sounds like a pain to have to deal with
Also, does whoever wrote this realize M&A has been one of the slowest performing groups this year at BofA? The tech M&A head left to Barclays a week or two ago. They have almost 0 deals there
Following
Sounds exactly like what happened at WF and what is happening at Citi
Assume this is NYC? Any thoughts on London?
Agreed there are some issues, but BofA as a whole is probably the only BB that has been gaining share in investment banking over the last few years (aside from UBS)
Also, for what it’s worth, BofA may have fired less but they have also moved people to other parts of the bank or given time to search for jobs with clear messaging that folks won’t get promoted - might not be as cut-throat as GS but has its benefits too
The post may be referring more to the US though - for example C&R EMEA certainly not a slow group on deal flow and has also seen some decent exits in the past year including to CD&R, Triton and Mideuropa
Agree with the sentiment but the “gaining market share” is misleading. BofA hired a ton of MDs the past few years which is the sole reason. Revenue per head is way down, and consequently pay is way down. Very concerned about this continuing
Those who stay will be comp’ed. BoFA will show high pay numbers next year, and then morale and recruiting will improve
🧢
👒
What a ridiculous take!
Let's be real here, BOFA will remain the best BB behind GS/MS/JPM. Citi is currently going through an RX and planning to focus less on IBD, Barclays just lost a shit ton of their rainmakers to UBS and hasn't replaced them with rainmakers of nearly the same quality, even though UBS stole a bunch of Barclays senior bankers they still aren't even top 10 in NA league tables for the year(I understand that MD's take time to settle, but my point is more so than even if they took MD's I doubt they are gonna magically jump that high up this quickly), and DB is simply a bank with significantly more issues than to worry about IB and also just like Citi is very much focused on fixing their business atm instead of growing their IB + again similar to UBS simply far too behind(even more to an extreme to UBS as they are not only not top 10, they aren't even close to it while UBS is at least close to top 10 in NA). I think that's pretty much all the other competition among the traditionally considered BB's, it's pretty clear BoFA will remain 4th if not for any reason except that the other BB's are even worse.
I am at one of Citi/Barclays btw, so not even sucking off my own firm here, just stating the truth.
They probably will based on sheer number of MDs and the brand, but not because of talent. The only banks that paid shittier or equal bonuses to BofA this year were citi and Barclays (as you mentioned), who had clear reasons to do so. Hell, shitty banks like wells, RBC, and BNP paid their juniors significantly better than BofA did.
Fine by me if BofA stays #3 BB, but as a talented senior associate all I care about is my bank account and there a million other better banks to go to. Peace
all of DB’s issues have settled but the rest is true
all of DB’s issues have settled but the rest is true
With that many MDs not winning deals won't BofA's bottom line just get fucked down the road.
What about BofA these nutz
Where is BofA
Anecdotally, we have BoA HC running one of our mandates right now and VP seat has been a revolving door, it's someone new on the email chain every time. Looks like one of them just recently left to an investing seat.
Is HC sweaty?
wait bofa HC...sweaty??
Bump
Very sweaty - ASO at BofA
Incoming SA in M&A
Should I be worried?
2024 or 2025?
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