The Office: (Ricky Gervais version clearly)....

UPDATE # 1

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[From Yahoo Message Board, but appeared in mainstream press]

    

For everyone who keeps saying "don't give these UBS bums their end-of-year compensation, they have nowhere to go," you might want to think again.

Today's Daily Deal reported that two high-level UBS bankers have just departed for more "friendly" climates.

1. Jon Bass, the Fixed Income banker who told his boss to "sod off" last week and left the UBS trading floor to a standing ovation, took all of 36 hours to land a new gig. Wow. Rough employment market for a bum, huh?  DD reported BTIG LLC will launch a fixed income group of 60 people and Bass and a former Citi executive will head the group. Who thinks he even had time to get to the Unemployment Office last week in between fielding phone calls with new offers?  The net of it all is that Mr. Bass found employment and a paycheck, and UBS (and its shareholders) lost his production on its income statement.  Sorry, who won that battle?

Key Question #1:  How many of those 60 new people will be coming from UBS?!!!   Non-solicit agreement?  Don't make us laugh.  Every banker knows as long as you make the first out-bound call to your old boss, UBS won't be able to touch him.

2. Robert Gillespie will join Evercore Partners as a Senior Managing Director in London. A young star you wonder? Gillespie was with UBS for 27 years, but most bankers at UBS will tell you that he is certainly not a "star" (at least no longer) and is anything but "young." Just goes to show even the has-beens will find great new gigs. 

Key Question #2:  If somebody who has been there for 27 years--and was one of the ORIGINAL bankers who built the franchise from nothing--chooses to leave, what does that tell you about the climate at UBS?  Let's admit that someone with 27 years in residence has some inside information, so if Mr. Gillespie has determined UBS is not a great place to END a career, what do his actions imply about UBS as a place to START a career right now?! 

If one thing is certain on Wall Street, this trickle cold become a full-fledged flood in no time flat....

UPDATE # 2

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UBS' Investment Bank has basically just notified its investment bankers that they are a very unique breed, indeed, on Wall Street in that they all worked for free in 2008 and will be getting no year-end compensation.  So, you'd imagine that the stellar management of the firm must be completely cutting any and all expenses that are not deemed absolutely crucial, right?  Uh, not really.  We've learned that the modern day equivalent of the  "Partners Lunch in the Executive Dining Room" continues for the bank's big shots.  From what we've seen/heard, UBS apparently continues to offer a catered lunch--gratis--a couple/few times a week for the firm's Managing Directors; think hot entrees or sushi, bone china, real silverware, real linens.    Again, you couldn't make this up if you tried!  Maybe they should be offering that for the poor kids just out of university they're about to stiff, or to their admins getting by on USD$35k a year?!   Apparently, to their credit, more than a few MDs have been embarrassed that this continues and few turn up on any given day.  Maybe these MDs all kept mum lest they arrest the gravy train or jeopardize that big check they were expecting.  No risk of that any longer as we know.  In any event, who the hell is the "UBS cost czar" approving that?!!!

UPDATE # 3

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In re post below from UBSdude:  your point is noted.  

The prior observation was largely targeted at "new recruits" (as you put it) that UBS is throwing money at hand over fist to lure from Morgan Stanley, Citi, Merrill Lynch and elsewhere.  We've heard also the scores of talented Wealth Management advisers who have been doing same for UBS for several years already are irate, and thinking about leaving (probably only to get lured back by the dumb money in a few weeks time).

UBSdude has rightly pointed out that "resentment" is a genie not easily returned to the proverbial bottle.

1.  The entire Investment Bank is irate with Switzerland, which took its gross margin at the Investment Bank (before its writeoffs for all the dumb crap in Fixed Income that the Board missed and before accruals for criminal indictments and fines in Wealth Management, as we noted previously) from a typical 50% on Wall Street in 2007 to 95% in 2008.  Oversimplified?  Sure.  But you get the point.  There is virtually no labor cost in there this year. 

2.  The entire Investment Bank is irate that Switzerland is spending like drunken sailors to get any Wealth Management advisor cast off by Morgan, Merrill or Citi that has a pulse and ten clients.

3.  The Investment Bankers are now glaring at each other wondering, "does THAT guy/gal have a guaranteed contract?!    Rule of thumb:  Anyone who says, "we all just need to calm down," OR "we have to keep this thing together," OR "we'll be OK when we come through on the other side"--yes, THAT guy/gal has a guaranteed contract!!!

President Obama ought to learn something here, if he's not as thick as UBS' management.  If you allow (or dare we say ENCOURAGE) resentment to gain a footing and infighting to break out in a time of crisis (think "Wall Street" against "Main Street"; "Rich" against "Middle Class; "Taxpayers" against "NonTaxpayers"; "Gay" against "Straight") once great institutions can unravel in the blink of an eye.

Will UBS wake up in time, reverse the disastrous course it has set itself on, and manage to save a great institution before its too late?  If they don't do/say something before February 10th to quell the unrest, it may be too late for "You & Us"  

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UBSdude said...

Pretty good read, but I must say the idea that WM people are getting fat bonuses is entirely laughable. In comparison to IB - maybe. But still pretty crappy. For WMUS home office employees bonuses are down anywhere from 40-70% from last year - and they were pretty crappy last year too. Not to mention the caps on bonus and claw back and deferrment. 

Also, for years the IB has been getting fat bonuses especially compared to WM. Did they deserve them at the time? Possibly - but look what it caused in the long run.

Not saying the IB situtation doesn't suck terribly. It sure does, but to paint a picture that WM people are getting fat bonuses is just wrong. Only the the brokers who are "New Recruits" are getting big paydays. It appears this may also be causing resentment in the non-new recruit brokers too btw.