As Deutsche Bank's equities traders sit at home or in the 'CRU', or prepare for whole new lives at BNP Paribas, and as Deutsche's rates traders do much the same, it's worth recalling what Deutsche Bank used to be like - back in the days of Anshu.
For this, it's necessary to revist the classic video below made by Colin Fan, the co-chief executive of Deutsche Bank's investment bank, who found it necessary to warn Deutsche's traders that "being boastful, indiscreet and vulgar is not ok. It will have serious consequences for your career."
So, how vulgar were salespeople and traders at Deutsche Bank? Fan's decision to extol the virtues of modesty and discretion came before star trader Christian Bittar, whom Deutsche paid $117m in 2008, was jailed for five years in 2019, but after a series of indiscretions that suggested Deutsche wasn't as wholesome as it might have been.
1. Making 'festive jokes' about being able to manipulate markets
In 2014, Deutsche Bank reportedly fired three of its New York-based FX traders. They included Robert Wallden, a director in the bank's FX unit. Wallden was said to have 'made a joke, in writing, about his ability to manipulate the markets.' He was later investigated by the FBI, who turned up at the Wallden house brandishing a transcript containing the joke, which was purportedly just a little light-hearted fun around the Christmas period.
2. Loose and misspelt 'text chat' via instant messaging systems
Deutsche Bank banned its fixed income traders from using chat rooms in late 2013. Compared to banks like UBS and RBS (and more recently RP Martin) Deutsche's traders weren't the biggest source of outrageous transcripts in the Libor investigation. However, Guillaume Adolph, a yen derivatives trader at Deutsche did allegedly turn up in some transcripts involving Tom Hayes, the ex-RBS trader accused of manipulating Libor.
In these transcripts, Hayes reportedly said: "cld you do me a favour would you mind moving you 6m libor up a bit today, i have a gigantic fix.” Adolph replied: “I can do taht.” Adolph then asked Hayes: "“u happy with me” (sic). Hayes was.
3. Waving money out of windows at people on the street below
Most outrageously, back in 2011, Deutsche Bank reportedly suspended a London-based employee for waving money out of windows. The suspended man (allegedly a trader) was seen at a window waving around a £10 note and taunting people on the street below who were protesting against health care cuts. At the time, there were also unconfirmed reports of Deutsche Bank employees photocopying money and sprinkling it on the protesters on the street.
4. Bribing clients
In 2014, Shigeru Echigo, a Deutsche Bank salesman in Tokyo admitted to bribing a client by spending $8.8k 'entertaining' him on 15 separate occasions. Echigo said he didn't act alone and that this sort of lavish entertainment was an institutional norm at Deutsche's Japanese brokerage unit.
5. Casual sexism
Deutsche Bank was one of the first banks to run an annual woman's conference (this will be its 25th year), but the bank - like many others - has been accused of sexism in the past. In 2010, a former compliance officer alleged that a co-worker was promoted to MD, “despite having such a poor record on sexual harassment that DB will not permit him to have a female administrative assistant.” Deutsche denied this.
Way back in 1999, Deutsche was compelled to pay £1m in damages to Kay Swinburne, an M&A banker who was subject to sexist remarks from her boss, Hugh Tidbury. Tidbury, head of Deutsche's chemicals group, reportedly said that Swinburne was "hot totty" and a "bit of alright." Deutsche kept him on for five years after the case. Hopefully things have improved substantially at the bank since then.
6. Lavish lifestyles
This week's case of Deutsche Bankers having £1.5k suits fitted while colleagues lost their jobs, seems reminiscent of a big-spending ethos at Deutsche in the past. When former COO John Cryan arrived in 2016, he met Gunit Chadha, the chief executive of Deutsche Bank’s Asia Pacific operation, in a restaurant beside a "spectacular swimming pool." To Cryan, who was already trying to cut costs, it made no sense - "Why didn't we meet in the office?", he asked. When Sam Wisnia, Deutsche's former head of macro trading, wanted to treat his staff in May 2016, he's said to have flown them to Washington on a private jet. - At his own expense, admittedly.
Interestingly, Cryan is also said to have spoken to Mark Fedorcik, then head of DCM and new head of the whole investment bank. in 2016, Fedorcik was reportedly proud that he'd cut 100 of 965 debt capital markets staff, and Cryan thought this was insufficient. Fedorcik may need to cut a lot more staff in future.
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