Morning coffee: Credit Suisse’s delayed bonus generosity isn’t necessarily working. Intensely patronizing layoffs hit the fintech sector

Given the choice to work elsewhere now, would you stay at Credit Suisse? What if you were offered a big retention bonus mid-year to stay? Still no?

If Credit Suisse wants to keep anyone now, they presumably want to keep CEOs in their investment banking division. In particular, it is presumably keen to hold on to CEOs covering such hot sectors as fintech and power, energy and renewables. And yet these are the CEOs of Credit Suisse who are leaving.

Bloomberg reports that both Prescott Johnson, CEO of Credit Suisse’s energy and infrastructure team, and David Goldstein, managing director of Credit Suisse’s fintech team, will. Both are based in the US and had been with Credit Suisse for over a decade: Johnson was there for 12 years, Goldstein 16. Johnson joins Bank of America; Goldstein is going to Jefferies.

The departures come after Credit Suisse announced last week that the investment bank would be subject to further restructuring pending a new plan to be revealed in the third quarter. However, Credit Suisse’s M&A bankers should be protected from the turbulence: the bank intends to move to an “advisory-led” model, and its M&A revenue rose 44% year-on-year in the second quarter after “significant deal-making activity” . David Miller, global head of investment banking and capital markets, said in June that the bank is hiring: after adding 55 CEOs already in the first six months of the year (to replace 69 who left in 2021), CS planned to hire a another 40, Miller said.Credit Suisse may be restructuring, but its M&A and capital markets operations are supposed to be in growth mode.

If that’s not enough sales to get people to stay, Credit Suisse recently handed out $300 million in retention bonuses in a single month to help the company retain talent. These bonuses were aimed at employees in Asia and North America and one senior financial sponsor banker alone reportedly received $10 million. Goldstein and Johnson surely got something.

Not enough, it seems. And the risk is that where they have gone, others will follow. Despite the declarations of consistency, there is turbulence. Christian Meissner, head of Credit Suisse’s investment bank, is leaving and it is not clear who will replace him. $300 million in retention bonuses doesn’t count for much after last year’s bonuses were cut, and while this year’s bonuses will likely be cut as well. The bank’s loss of CHF 1.9 billion in the first half of the year and the investment bank’s loss of CHF 1.1 billion for the second quarter also do not bode well for further repayment of bonuses awarded in the past. Unfortunately for Credit Suisse, Goldstein and Johnson may not be the last bank CEOs to leave this year.

Individually, the 780 people laid off from Robinhood in the latest round of layoffs there may at least have nothing more to do with what appears to be a somewhat troublesome company culture.

In a letter to employees about the job cuts, CEO says Vlad Tenev repeatedly refers to his acolytes as “Robinhoodies” and regrets the need to leave almost a quarter of his Robinhoodies go. Nevertheless, needs must, and Tenev says each “Hoodie” will soon receive a Slack message informing them of their status. If they are no longer wanted, this will be followed up with a schedule to discuss their specific situation live. “We know this news is tough for all Robinhoodies, and we’re also offering wellness support to those who want it,” adds Vlad.

Although the mood is strong, it is not the insistent evocation of a Parisian set of friends. At least Credit Suisse employees can celebrate the fact that they aren’t known by the collective noun “Suisseys,” even if the bank is likely to drop many more of them soon.

Meanwhile…

Robinhood shares rose 13% after it said the hoodies would go. (Bloomberg)

PayPal saved itself $360 million by cutting staff. (Bloomberg)

A Hong Kong-based company apparently owned by former UBS banker Calvin Choi appears to be worth $310 billion after increasing in value by 22,000%. AMTD Digital develops digital businesses, including financial services firms, and is now worth more than Bank of America, Morgan Stanley or Goldman Sachs. The rise in the price may have something to do with the fact that only a small proportion of AMTD’s shares are available for trading, which makes it easier to push the price up. Choi is intolerant of the haters. “They are the ones who envy and [are] jealous, and those who are cold-eyed and scoffing and malicious, those are slanderers,” he declared last year. (Bloomberg)

SocGen says it is in “cautious but not catastrophic” mode. (Financial Times)

Point72 employed two economists: Sophia Drossos as economist and strategist based in New York, and Soeren Radde as head of European economic research, based in London. (Hedgeweek)

Don’t be too ambitious with your vacation plans. “Trust your gut and gravitate toward experiences that seem most enjoyable when you imagine them.” (WSJ)

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