London Landscape
Hey guys,
Just wanted to start a discussion on the landscape in London given that it’s 2018 and the affects of brexit are looming and the future is still uncertain.
I guess just really wondering what the overall atmosphere and landscape for investment banking is in London right now?
Secondly, how do the top investment banks in London rank? For the BBs it seems like the ranking is similar to that in the US with GS/MS/JPM being the top but how do the boutiques rank? How do Lazard / PJT / Evercore / Moelis / Centerview rank in London including the restructuring businesses for Lazard and PJT?
How much do London bankers make relative to the US and each other?
Very pro business, they'll be Dublin down on their profits if they move there.
What are we ranking? M&A? Banks as a whole?
If the former prob something along the lines of (very general, obviously group dependent):
BB Tier 1: GS, JPM, MS EB Tier 1: Centerview, lazard, rothschild, evercore
BB Tier 2: Citi, BAML, CS, DB EB Tier 2: PWP, GHL, Moelis, PJT, Jefferies, MACQ
BB Tier 3: Nomura, UBS, BARCCAP, HSBC, RBC, SocGen etc
If we're talking trading then its very different
Don't believe all the "woe is me types", nobody is going to close down shop and move everyone to Amsterdam or Dublin (least of all Paris)
I agree with the above poster about the difference in salaries probably being due to not re-balancing after Brexit vote, which is quite stupid really
Dont think the above ranking will change much
Don't agree with this for M&A. Places like RBC, Nomura, HSBC, SocGen are not BBs status. Jefferies and Macquarie are solidly MM banks.
Using your general layout, I would say it's more like the following:
BB Tier 1: GS, MS, JPM EB Tier 1: Lazard, Rothschild, Centerview, Evercore, PJT
BB Tier 2: BAML, Citi, CS EB Tier 2: Moelis, PWP, GHL
BB Tier 3: UBS, DB, Barclays
JPM tier 1b and Barc is more like Tier 2b not 3. Moelis is Tier 1 in EBs. The rest seems good.
Personally i never understood the point of the term "Middle Market". I absolutely agree that the above banks you mentioned do not have the same deal flow as the others but they absolutely are BBs. They are global, conglomerate banks, how else would you describe them? On jefferies and MACQ again, what is an MM bank? "Bigger than EB but not like a BB"? pretty stupid comparison don't you think? especially given if that was the case you'da ssume them to be closer to the BBs in terms of operations than the boutiques which simply isn't true. If you have more insight on this i'd be glad to hear it but i think the way I laid it out is a fair comparison in terms of prestige/dealflow/ organization structure etc
Both Moelis and PJT are tier 1 EBs in EMEA. I don't know about PJT RX but apparently Moelis focuses a lot on RX in London.
Imo, Citi and (especially) BAML are much stronger than Cs/DB/ bar in Europe - also, where is Robey Warshaw? I would say
BB1: GS, MS, JPM BB1.5: Citi, BAML BB2: CS/DB/Bar
EB1: Evr/Laz/RW/PJT/cntw EB2: RTH/Jeff/PWP/Moelis
...
You are clearly a troll. Rothschild and Lazard are known to be two of the most elite independent advisory firms in Europe, regularly being mandated on prestigious deals and producing exits into the likes of Advent, CVC, Lone Star. PWP is solid as well, but Rothschild and Lazard are by no means second tier
BB: Tier 1a: GS/MS Tier 1b: JPM Tier 2: BAML/Citi Tier 3a: Barclays Tier 3b: UBS/DB (stay away if you can)
For EBs, I would say Lazard and Centerview as Tier 1, maybe Evercore as well. While Roth tend to do well from a league table perspective in EMEA, they are different in that they would usually take backseat roles / do random FOs etc. and get full league table credit for that. Average fees per deal is much lower versus peers and rarely would they be the #1 advisor on a complex deal, so I would not put them in the Tier 1 bucket. I'm sure they place OK though.
Moelis/Greenhill/PJT/PWP are all good shops but deal flow in EMEA is not great - I would not go to any of these places over a BB apart from UBS/DB and maybe Barclays for that reason. Macquarie and Jeffries rarely compete for the same deals as indicated above.
Know people at PJT/Moelis/PWP who chose them over JPM, Citi, CS etc. Look at the seniors at those banks and it will be evident that they are tier 1 shops.
I would have to disagree with your point.
1) FOs only give league table credit for the # of deals, not the deal value, so if Rothschild were to be mandated as a FO advisor, the metric for average deal value would actually look worse 2) Average fees per deal is much lower vs peers because of the reason mentioned above and the fact that Rothschild has a larger focus on the MM space vs its peers (Lazard/Evercore/Moelis). That's not to say they are never on large, complex deals, they are increasingly being mandated on larger more prestigious deals with success depending on the region you are looking at 3) Whenever they advise on a large deal, they are usually the lead advisor. E.g. Sainsbury's Asda, Essilor Luxottica, Unibail-Rodamco Westfield to name a few 4) PJT has one of the best restructuring practices on the street and a brand that comes with the Blackstone legacy. If you receive an offer from PJT vs a BB that is not GS/MS/JP, the decision would not be as black and white as you stated
I have a roommate who works at Evercore / PJT / Centerview / Moelis type of place. The comment about deal flow is very misleading. Their entire London office is smaller than a single BB team. Their yearly analyst intake is again smaller than the intake of a single team at a BB (i.e. GS, JPM, MS, CS, BAML takes in more analysts into each team). Some have no regional office presence so effectively the London team handles everything outside of the Americas. So if you compare the firm's deal flow, compare it to that of whatever top tier team you can think of.
On top of that, they're guaranteed to do only M&A and restructuring. No bs IPOs, secondary equity offerings that pop up every so often in an industry coverage. I interned at JPM TMT for a summer. 40% of deal flow pertains to capital markets, 40% M&A, and roughly 20% doing the absolutely mindless corporate broking stuffs.
Having gone through the banking grind in London and then recruited for large cap PE roles, I would say that most rankings in here don't make much sense to me, largely as I don't understand what they are based on.
Looking back, personally I believe what matters most is: - Relevant deal flow (you don't want to sit in your chair for 2 years building pitches, only doing capital increases, or being the industry sparring partner for the M&A guys) - Exits (there's some go-to shops for the top funds that HHs get in touch with first (sometimes exclusively))
In London, GS / MS / JPM generally trump all others in terms of exits. Sometimes HHs throw a PJT RR or EVR guy in the mix (especially on the Distressed side of things), but the right team from these banks will go a long way in terms of recruiting.
The majority of funds will consider everyone from GS to DB and EVR to GHL. For these you should generally have a strong deal sheet, good uni and grades, and a Euro language. However, a guy from my class made an amazing exit with only one deal (in the end it's not in the analyst's control, but more deal experience obviously helps - ideally also buyside. Looking to leave with 4 sellsides on your deal sheet is harder than with 1 buy- and 1 sellside. Most of the time in deal discussions you'll spend time talking about the buyside deal anyway)
If you want you can include other factors into your assessment like pay (EB pay is generally above BB pay with exception of Laz and Roth who pay their analysts fairly crappy compared to a PJT/EVR-type place), work/life (some BBs do more for w/l than EBs, often EB lifestyle is still pretty decent though) and "reputation" (GS or bust), but most who join the madness are set on leaving after 2 years anyway, so the points above are probably more important.
To end with a very subjective note: If I were to make the decision of entering banking again, I'd probably shoot for the top 3 BBs or EVR/PJT/MoCo over other BBs/Laz/Roth/other EBs, but that's just me.