Morning Coffee: The JPMorgan star who got caught in UBS’s Credit Suisse rescue. Deutsche Bank might sneak back into markets it left behind
Sometimes, you’re just in the wrong place at the wrong time. Among the management changes announced by UBS as it gets ready to integrate Credit Suisse, the group CFO Sarah Youngwood is going to be replaced by one of her own direct reports, Todd Tuckner.
This is quite a surprising move. It’s only just over a year ago that UBS poached Ms Youngwood from JPMorgan, and seemed to have been pretty happy to have done so. And well they might have been; if you look at her career history, it could not say “high-flyer” more clearly. From analyst to MD in fifteen years as a FIG investment banker, then head of Investor Relations, then CFO of Consumer and Community Banking (a huge operating division for JPM), then additional CFO responsibility for the Global Technology team while Jamie Dimon’s massive investment program was gearing up. Youngwood was on the potential CEO track.
For her, one obvious next logical step would have been a move out of JPM to get top-level experience, hence the move to UBS. But 14 months later, she's out. Why?
The most obvious explanation is that the job description changed, mightily. Ms Youngwood was hired to work with Ralph Hamers, as part of a cost-cutting, technology-oriented strategic program representing a significant move away from UBS’s recent past. Fourteen months into the job, Hamers has gone, replaced by former CEO Sergio Ermotti.
The official UBS press release says that Ms Youngwood “decided to leave after the transaction closes” and her own LinkedIn post also suggests that she went of her own accord. To us, this suggests that while leading a tech-oriented business transformation was part of her career plan, negotiating a merger integration in the notoriously tricky world of Swiss banking might not have felt like such a transferable skill.
Sometimes the smartest thing to do in your career is to realize that things have changed and past choices need to be revisited. We doubt that Ms Youngwood will be out of the market for long; probably not even long enough to realize her ambition of getting back to playing the piano.
Todd Tucker’s CFO promotion, on the other hand, seems to suggest a move back to the familiar track at UBS. Tucker's recent career at UBS has been in the wealth management business (the most important business unit), from which the path to the group CFO job is well-trodden – Ms Youngwood’s predecessor, Kirt Gardener, came up that way, while his predecessor Tom Naratil was CFO of the American wealth management business. It’s also notable that (according to their LinkedIn locations), Ms Youngwood was doing the global CFO job out of New York, while Tucker will be based in Zurich. The clearest signal for UBS employees from all the management changes appears to be that the Hamers era is over, and the new UBS is likely to look like a bigger version of Sergio Ermotti’s bank.
Elsewhere, it ought to be proverbial that if you want to keep a secret, don’t tell any bankers. “Market chatter” apparently has it that “at least two top operatives with experience leading local investment banking teams” in Australia have been talking to executives about Deutsche Bank about leading a return to the market that Deutsche left in 2018 at the start of Christian Sewing’s transformation program.
Deutsche is not commenting on the story, and it’s quite possible that it’s a bit of wishful thinking on the part of senior Aussie bankers hoping to get some more labour market tension into a market where bonuses have been disappointing recently. But it’s a sign of the times that, true or not, this rumour could be considered to be within the bounds of possibility. Having acquired Numis in London, transformed profitability and announced an intention to beat its previously announced revenue targets, Deutsche very much gives the impression of being a bank on the front foot. In an overall wintry environment, it’s no wonder that bankers are looking enviously at where the sun is shining.
Meanwhile …
You can’t really say that a proper banking crisis has really got going until Warren Buffett has picked up a load of shares at a breathtaking discount. At the moment, he seems to be keeping his money out of the sector, while suggesting that bank CEOs who go bust ought to experience a bit more social ostracism. (WSJ)
Although Wall Street firms are talking tough about people having to come back into the office, the reality appears to be that few of them mean “all day, every day”. Only 20% of financial firms in a recent survey were completely forbidding hybrid working, and it appears that the real battleground is “bosses want three days a week while workers want two”. A requirement for four days a week in the office is generally viewed as “not a real hybrid plan”. (Bloomberg)
As LinkedIn launches ChatGPT-powered “copilots” to help its users generate content (really, how can we tell?), a 20-year retrospective on the thinking banker’s social network goes through all the trials and disasters that have brought it to where it is today. (WIRED)
Concentrating on bond issuance for local companies, Standard Chartered is hiring for a new investment banking unit in onshore China. The ambition is to launch with “close to 100 staff on day one”, most of them based in Beijing. (Reuters)
It doesn’t pay senior executives enough, it’s got an unreasonable prejudice against dual-class share structures, and it blames auditors for corporate collapses rather than the people responsible for the company. According to Jan du Plessis, these are among the symptoms of the “peculiar, quite narrow British way of life” which are holding the City of London back. (Bloomberg)
Man Group has an internal training program to teach non-tech employees how to do bits of coding and data science themselves so as to not have to bother the tech team with small tasks. Graduates of the program reckon that they save up to a day’s work a month by automating tasks. (Business Insider)
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