Morning Coffee: Goldman Sachs' Darling takes most difficult job at Barclays. Banks’ AI job claims sound increasingly suspicious
As expected, Barclays has announced that chief operating officer (COO) Alastair Currie will be leaving, to be replaced by two co-COOs instead: Anne-Marie Darling and Craig Bright.
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Darling only joined Barclays in April. She's a 25-year veteran of Goldman Sachs, where she'd been a partner since 2011. At Goldman, she'd been head of global fixed income, currencies and commodities execution services, and head of the sales team for the Marquee platform. When she left, it was reported that Darling could have joined hedge funds, tech firms, or private equity - all of which had come calling.
She chose Barclays.
Why?
Being a COO is a big job, particularly in a time of cost-cutting. Just ask Paul Compton another former Barclays COO and feared cost-cutter of his day. Barclays wants to extract £700m of costs between 2024 and 2026. It's a difficult job. It's hired McKinsey & Co. to help. Darling will be in the thick of things.
Co-COOs is a curious move given the cost-cutting, but Darling will be in New York (while Bright will be in London). Bright was recruited from Westpac five years ago and was previously the group Chief Information Officer, there. That might suggest he could be oriented more toward retail banking and overall architecture. It's likely that she’s going to have more orientation toward the investment bank, and toward the trading and electronic execution systems.
Will she stay? Darling said a year ago that Goldman Sachs tended to lose senior female executives because “the Street wants to cultivate and access [Goldman’s] amazing talent”. A co-COO job overseeing the restructuring of a big bank’s trading and data systems feels like the sort of thing that you do as a stepping stone to something even bigger, rather than the final destination. When the Barclays job is done, Darling could yet become hedge funds' darling instead.
Elsewhere, riddle us this – there are, give or take, ten hours in a working day for an investment banking coder. That means that there are about 2500 hours in a year. So, an innovation which saves coders 280,000 hours must have replaced roughly a hundred jobs, right?
Wrong, according to Morgan Stanley. They have a new tool called “DevGen.AI”, which seems to help the task of rewriting old “legacy” computer systems into more modern environments. But although it’s claiming hundreds of thousands of hours saved, Megan Brewer of MS is insisting that it only replaces onerous routine tasks and “That means those people can actually go work on what we need to be working on, which is the future”.
Great! But … it usually pays to be cynical in the financial services industry. BNY Mellon said this week that it will continue to "hire top talent" while building out its "digital employees", which might imply that anything other than top talent won't be required in the future. PWC, is cutting prices of consulting services because AI is doing the work.
None of this seems to imply a happy world where humans are needed in equal numbers to the past. Morgan Stanley techies may be happy at the moment that they’re going to have a great time inventing the future, but they would do well to remember that the laws of arithmetic haven’t been repealed just yet.
Meanwhile …
Congratulations to 54% of the people who took the latest round of CFA Level II exams – the pass rate this time was the second highest since the pandemic. Particular congratulations to anyone who deferred their exam and then passed because you really beat the odds – the pass rate drops from 60% for first-time candidates to only 35% for those with at least one deferral. (Bloomberg)
It is somewhat unusual for an investment bank to drop a financial sponsors client, which is why lots of investors apparently want to know why Evercore is no longer doing business with Keensight. (Financial News)
Even in air-conditioned offices, traders apparently feel the heat. When the outside temperature in Paris is above 30 degrees centigrade, trading volume falls by as much as 10%. Apparently “Extreme temperatures increase fatigue, bad moods, and distraction among French investors, reducing their desire to buy or sell securities”. (Les Echos)
Absolute proof that AI is the new banking (or possibly that there’s a limited supply of cliches), as Sam Altman disparages rivals who hire staff away from OpenAI, saying that “missionaries will beat mercenaries” and that Meta will give itself “very deep cultural problems”. (WIRED)
The talent carousel is still spinning in Tokyo, as Citi has hired Akira Kiyota from Nomura to be co-head of Japanese investment banking. Follow-on hires are likely. (Bloomberg)
London bankers can’t keep their mouths shut, according to the Financial Conduct Authority. Nearly 40% of mergers were leaked to the media before any official announcement, and it seems like it’s being done “strategically” to try and shift the price or to talk a deal into happening. (FT)
“If I think legal should be overridden, I will tell you” is never a good thing to write in an email. In the case of Linqto, a firm that aimed to democratize venture capital by helping people buy stakes in private companies, the legal technicalities seem to have included things like “selling the shares customers thought they owned without telling them”. (WSJ)
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