Wednesday, November 07, 2007

Investment Bank CEOs: Another one bites the dust

As another investment bank head throws in the towel, another set of investment banking inspired lyrics begin dancing in front of your eyes, sung to the tune of "I Will Survive", but from that vey embattled CEO's point of view.

First I was Chief counsel,
And then the CEO,
I pinned red umbrellas in my suit,
But the shares they moved so slow,
Investment banking was doing well,
ECM made cash to burn,
I was riding the financial markets,
Hoping there’ll be no downturn,

And then the dance,
Began to slow,
All the hedge funds pulled their cash,
nd the institutions began to follow,
And now my share price is in the pits,
Massive writeoffs are what I see,
I don’t want no shareholders,
Can’t they just stop bothering me?!?

They say “go on now go”, “walk out the door”,
“Just turn around now, 'cause you're not welcome anymore”
“ Weren't you the one who tried to stick to the strategy,
That read that if you get advised by us, we’ll throw some debt in there for free”
I should have split the firm apart,
I should have sold it bit by bit,
Like all the analysts told me,
Now it’s all just gone to shit,
At least I’ve got my options when I leave,
Although they don’t amount to much today,
But once I’m gone the price will soar,
And I’ll get my sky high pay day.

Just out of curiosity, how many of you monkeys and monkeyettes out there recognise the CEO and firm in questiosn. Drop the monkey a comment to have your say!

Wednesday, October 31, 2007

The poetry of investment banking

It's late at night, you're in a cab on your way home and you are paging through you schooldays companion, a book of poetry that reminds you that there are people that have more to say that the overvalued manufacturing arm of the nation's largest conglomerate. As you page through the book, your financial overload of the day metamorphosizes with the words on the page. Before you know it, you are reading Robert Burns' A Red Red Rose and instead of the original verses, a strange collection of the event of the day seems to be lurking between the lines, as if the chief executive of one of the investment banks were himself reading these verses and narrating his view of the world through this beautiful medium.

O my firm is like a pot of gold,
With plenty of cash to spare;
A lawsuit here, a settlement there,
The balance sheet has more to spare.
Those multi -million settlements,
Are peanuts for the house of Merill;
Lose one or two, you lose a few,
But eight billion is cause for peril.
Our balance sheet was hit real bad,
Our investor’s confidence was shaken;
But such is the strength of the Merill name,
And my options were still there to be taken.
Farewell my underling, farewell!
For I will certainly do!
I’m off to retire with my $160 mil,
And wish the best of luck to you.

Friday, October 26, 2007

Stewie Griffin Meets Wall Street

A gem of a video...

Investment Banking Training Video

The monkey's hat goes off to the performing artist in an investment banker's shoes in the video below.

No comment necessary.

Investment Banking Banannas

Courtesy of another monkey...

Wednesday, October 24, 2007

The investment banker moves on: out with private equity, in with the strategics

So what if the Kruelbergs and Blunderstones of this world are finding it hard to get the kind of cash from their investment banks that they did just a few months ago. It’s an investment banker’s duty to try and then to try harder. Prepare pitches, present profiles, think in the box, out of the box, around the box – whatever it takes to get that damn tombstone. It has to be said,\however, that sometimes, a deal simply doesn’t work. It may be because the client is a dumbass who cannot tell their ass from their elbow, and can’t se a good deal when its staring them in the face. Sometimes, it’s because the deal or idea the investment banker has cooked up is so poor that even a three year old chipmunk wouldn’t look at it twice.

Nonetheless, it’s not an investment banker’s duty to question how or why. When a deal does not work, the investment banker takes rejection with dignity and honour (by telling everyone that the client is a muppet, for example) and goes to pitch the same idea to the next potential client that is willing to take the time to hear him out (it is very important to make sure that the client’s logo at the front of the presentation is changed in the pitchbook, as for some strange reason, clients tend to get rather upset when for example someone at Kruelberg opens the exclusive and unique opportunity that the firm has set aside for him and just him, only to find Blunderstone’s logo on the front page).

So we do live in times when the next client to pitch to isn’t going to be a private equity house. This is most unfortunate for the analyst involved, as it significantly reduces their ability to get headhunted into the buyside by impressing the clients with their knowledge of the art of bullshit. Big deal. Look on the bright side. No need to impress snotty nosed, full of themselves, smug ex-investment bankers who feel the need to overcompensate for all the shit they had to take in their junior days by making the investment bankers who work for them feel even worse. No way. Now that the Kruelbergs, Blunderstones and Crapaxes of this world are no longer in the market to but overpriced assets, in come the corporates, with their warchests of cash, sitting on their balance sheets. Their boards are no longer afraid of being pushed out by a crazy private equity fund (not that those guys have become less crazy, but they simply don’t have the cash nowadays), so there’s no need to worry about returning value through share buybacks. And with no buybacks, all the cash they make just sits idly on their balance sheet. It is in times like these that the investment banker hears his calling.

“Pitch to them!” says the deep voice of investment banking wisdom.

“Make them acquire!” roars the voice of investment banking passion.

“Help them expand their footprint in new markets!” whispers the voice of investment banking sincerity.

“Create the leaders of tomorrow” hollers the voice of investment banking vision.

The investment banker is drawn to the voices, dancing majestically like ballerinas in his head. Their words creating visions of synergies, multiple expansion, consolidation and premia. And as this spectacle of investment banking vision crystallizes before his eyes, the investment banker hears the deep, clear voice that overrides them all. It is chanting, loud and clear, the raison d’etre of every senior investment banker – “fees” sweet, glorious, upwards scaled, beautiful fees.

And for fees to materialize, deals need to happen, so the universe of the investment banking managing director eclipses with that of the humble analyst. They look together into the sunset over the City of London and march on to the next pitch – that next pitch that just might turn into a deal, that just might close. And if it does, oh how sweet those fees will be, and how wonderful the creation of yet another set of lucite tombstones will feel.

The Monkey is back: the New Investment Banking Paradigm

It feels like an age has gone by since you last reflected on you existence as an investment banker. You almost don’t know where to start, what words to use, how to describe the feelings of bitterness, resentment, pride and greed that, in subtle, interwoven overtones, paint the skies of the investment banking universe.

You sit reflecting on what you need to catch up on since the last time you had a few moments to yourself, and as you stop to think, you are immediately frustrated by the time it actually takes you to get that rusty machinery in your head going again. The core skills of investment banking have become innate to you, and as you have perfected these arts of slyness, manipulation, misrepresentation and disguising self-interest, you haven’t had the need to switch off the auto pilot and do some actual thinking.

Damn. That’s hard.

So what’s happened in last few months? Ah, nothing much. Kruelberg came, Kruelberg went, came again, went again, finally quenched a megadeal. Another investment bank advised on it. You worked on the financing. Bigass financing. One of the biggest financings of all time. Ok. It was underwritten by the same guys who advised Kruelberg on the deal, but you at least got a glimpse of the action. You’ll get a tombstone on your desk, and in ten years from now, nobody will even remember who did what. All that the little analysts will se when they enter their MD’s (your!) office will be the triumphant testimony that you were involved in one of the most amazing deals ever. That’s pretty good. Pretty damn good. And it’s all about the tombstone.

Oh. Yeah. One tiny detail being that, there was some more shit that happened in the meantime, and that tombstone is looking very unlikely. Why did the markets have to go sour on your big deal watch. Liquidity gone, spreads widening, the firm decided to pull out of the syndicate for the financing. They might have saved their asses but they sure screwed that tombstone for you. Why? Why? Since when have dividends to investment bank shareholders been more important than investment banking glory?!?

Oh well, Kruelberg and their other adviser, in the meantime, finished the deal. Those other analysts got a tombstone. So the market crashed. Their leveraged finance analysts also got a financing tombstone. So the whole ridiculous amount of debt is on the bank’s books. So what, they’ve got a tombstone. And to top it all, now that the debt market is distressed, Kruelberg looks like it will team up with said bank to create a special purpose entity to scoop up all the debt that it actually borrowed and the bank could not shift on to suckers like the firm. Ok, so Kruelberg not only gets its financing, but also makes a whammy by buying it off the bank at below the nominal value because it’s ‘distressed’! Genius. Kruelberg: 1, the investment bank: nil points. But hey, some little fucker in structuring will get a tombstone out of it for sure. Bottom line – screwing your shareholders over and making Kruelberg richer is a great deal for the bank – the tombstones are well worth the plummeting share price.

Sadly, that bank was not the firm. The firm’s shareholders and partners are richer, and you don’t have a single tombstone to show for it.

Thursday, August 16, 2007

Where will this investment banker be in ten years' time?

So, the jury is out. You’ve been running around the bank, asking everyone where they thought you would be in ten years’ time. A great strategy, you thought to yourself, given the fact that you don’t have a clue as to what you will be doing and who you will be doing it for. After all, investment bankers are the some of the (self proclaimed) best brains around - the best and brightest – the world’s leading corporations jump at the opportunities and ideas the investment banking world throws at them, so why not leverage these great minds and let them decide your future for you. After having asked hundreds of keen intellects (well, 422 to be precise) about where you will be in ten years’ time, the results are rather puzzling, if not a little unsettling. Topping the list, one hundred and sixty four of them thought you would end up in a mental institution, ninety two said private equity, sixty four said you would make MD at the firm, fifty seven said you’d end up in a hedge fund (and hopefully one that doesn’t fold) and a generous forty five thought you would be retired.

Hmmm. The majority think mental institution eh? Well, the majority in 2000 also thought the boom bust cycle was a thing of the past. The majority also never saw Long Term Capital Management folding. Grateful as you are for everyone’s contribution, you take comfort in the street’s unprecedented ability and track record in getting things wrong and dismiss the mental institution idea.

Letter to an Investment Bank's Shareholder

From: The firm's management committee

Dear shareholder,

We would like to take this opportunity to provide you an update of the recent trading performance of the firm.

As you may already know, the overall market conditions, both on the debt and equity side have been rather challenging of late. We take this opportunity to explain to you, our fellow shareholder, the firm’s exposure to this market environment as well as the active steps your management team is taking to ensure your investment continues to deliver the high returns you expect.

Over the past twelve months, we have taken active steps to augment shareholder returns and deliver greater returns on your invested capital. We have identified strong growth areas in the market of alternative investments (hedge funds, private equity, etc) as well as augmented our business practices and divisions with strong exposure to these.

We have beefed up the headcount of highly motivated (and thus remunerated) managing directors in our leveraged finance and financial sponsors teams. Whilst this has been a significant short term cost to the firm in terms of hiring costs and guaranteed multi million dollar pay packages, these investments have positioned us to take full advantage of the private equity boom in the market. Unfortunately, the debt markets have not been doing as ell as we hoped, and the clients of our financial sponsors group are not doing any deals, so these expensive teams are now put on hold (the technical term for this is “TTT” – Twiddling Their Thumbs”). Also, our prime brokerage teams are in TTT mode owing to no activity from the hedge funds they were hired to serve.

Despite these temporary setbacks, our other divisions are well positioned to deliver strong revenue growth. Our equities division, for example, is ready to kick in and more than make up for the revenue lost by (and higher costs at) our financial sponsors, leveraged finance and prime brokerage divisions. Only problem is, and we are convinced once again that it will be of a short term nature, is that equity markets aren’t doing all that well, and our clients are pulling IPOs left, right and centre.

However, not to work, as we are a forward-thinking, strategic planning organization, and are actively planning for how we will dominate the market in the imminent recovery. As testament to this, we have this summer hired our largest analyst class for the investment bank, and it is the largest class ever. It might be that these analysts will be in TTT mode for some time now, but still, they will ensure we have the deep bench of associates for the next boom market that we will need to stay number one.

In short, we are happy to report that despite our share price performance (which has tanked, and with it, the retention ability of our rainmaking MDs, whose options are now all but worthless), our missing revenue targets and exceeding costs is of no relevance as we are looking to the future, and the future is indeed bright. Trust us!

Your management team.

Monday, August 06, 2007

Hedge Funds

For your viewing pleasure...

Wednesday, August 01, 2007

Born to be an investment banker

You wake up all hyped this fine morning, as a revelation passes in front of your eyes. You don’t need to have Rupert by the cojones in order to make your way up the firm’s structure. We live in efficient markets, as you discovered on your coffee break, and there seems to be little you can (legally) do to go round that fine point. But hey, as with all rules, there are even finer ways of twisting them to get them to work to your advantage.

Remembering the priceless advice on posturing you were given, you decide that it’s time to take the game up by a notch or two. This is something that a Mont Blanc pen and a good suit alone cannot solve. This calls for creativity, out of the box thinking, and the use of your entire investment banking skill set. This will be where your financial modelling skills will come into play. All those hours spent sitting in front of your computer screen, negotiating with your excel spreadsheet in order to make a lemon look like a peach. All those hours are finally about to pay off, as you run through your genus plan.

Much like the fact that selling a company has very little to do with the crap shape it may be in today, but the promise of a wonder once the lucky buyer has acquired it (and gets stuck with it), your progressing up the investment banking ladder has nothing to do with you being a good banker. It actually has more to do with the perception that you are a good banker. And good bankers are in strong demand, so you must demonstrate that you, being the great banker that you are, are fighting offers for employment left, right and centre.

Now this has nothing whatsoever to do with the fact that you have none of these wonderful offers, nor are you close to getting one. However, just like a guy in a good suit is automatically an investment banker, a guy in a good suit coming late to the office on a regular basis, must be interviewing left right and centre. By the same token, if said banker is interviewing left right and centre, there must be people calling him for interviews and thus he must be in demand.

And if said banker is so highly sought after by the competition, well, the firm must do everything in their power to retain him and make him happy. The fact that the firm has not really found the said individual to be of such exceptional superstar fabric is of little relevance, as what is more frightening to any investment bank than making the wrong call, is if their competition makes the right call at their expense.

So, cutting a long story short, pretending to interview, and subtly dropping hints in the right place, at the right time, will get you junior support, an early promotion and the ability to cherry pick the deals you work on. All that, courtesy of the firm’s fear of erroneously having thought that you aren’t really that good.

To make it even better, the fact that you won’t really be interviewing, but still will be showing up late to work as if you had been interviewing, will mean that you will have reduced the amount of hours spent in the office! Bonus.

You smile quietly, amazed at the sheer genius of your plan. You also think yourself rather silly for having entertained the thought that you may not exactly be top tier banker material, for anyone devious enough to concoct a deception of this magnitude, was born to be an investment banker.

Monday, July 30, 2007

Games for investment bankers

Getting ready for the conference call:

Step one:
Prepare a four by four square, randomly filling each cell with one of the below phrases / words.

bottom line
double check
margin expansion
impressive growth

Step two:
Tick off each block when one of the phrases is mentioned

Step three:
When you have ticked off four boxes in a row, column or diagonally, stand up, bang your fist on the table and shout "BULLSHIT!"

Value added in investment banking

Working for a client on the buyside is always fun. You’re in a kickoff meeting you’re your client, for whom the firm is a house bank, and you’ve just been handed a presentation the client received from an investment bank hired to sell the company your client wants to buy. The first thing you can think of, is trying to pick at little bits and bulbs that don’t add up in their numbers, spelling errors, bad formatting, and other high value added remarks.

Having spent some fifteen minutes on the slides, one particular page looked like this halfway through the meeting.

Saturday, July 28, 2007

Douey, Cheatham & Howe

Friday, July 27, 2007

How investment banking is like royalty

Funny thing, you think to yourself, crouched over a discounted cash flow model on your screen on a Friday evening, that investment banking is so much like royalty. And not progressive royalty like a number of European countries have today. No. This is the old fashioned Marie Antoinette kind of shit we’re talking about here.

Thinking about why you’re sitting over an excel model for a project you’re not meant to be working on, for a client who you don’t even know and with a team that is in the pub having pints, brings you to this amazing realization. Why is it that you are here, and they are all there, and the guy that’s meant to be doing what you’re doing is the one in the middle of it all, having fee shots left right and centre.

Zap – flashback and it dawns on you again. Because he’s the intern and it’s his “half-way-through-the-internship-(yay he survived four whole weeks of spoon fed and sugar coated investment banking ass kissing)-drinks”. He’s a fucking intern! Fucking intern? So why are you here, doing his work, and he’s there, doing your drinking? Oh, And PS, who the fuck has heard of “half-way-through” drinks? So, back to the point, why? Well, because he’s part of the investment banking royalty programme, more commonly known as the “I’m an investment banker cos my daddy got me the job” programme. In his case though, it’s even better. both of his parents are managing directors and his uncle is a CEO of a Fortune 500 company, so go figure. There a programme where children of the employees and clients can intern for the summer (only one phone interview required versus the 3 plus who knows how many superdays that other mortals have to endure).

So why is it that these Bob Kings, Robert Mack, Francesca Paulson and Henry O’Neals (that’s right, check the internal databases and find out that the monkey is not cruel enough to name the real individuals) of the world get hired?

Well, to a certain extent, for entertainment. To do jobs, even jobs that are impossible to screw up, and screw them up, so everyone can discreetly laugh after congratulating them on a job well done.

But jokes aside, these individuals get hired for the same reasons that the royals of the past wanted male children – so that the firm can secure its next generation of leaders. It is only exceptional people, with no leadership skills, extensive ass kissing ability, no scruples, and an ego the size of the city of London, but no discernible skillset as such (MD’s) that are truly fit to run the firm. See the resemblance? Yes. Incompetent? Useless? Ignorant? True investment banking managing director material.

So that’s how investment banking is like royalty, you think to yourself, looking at the screen. You keep looking, when a comforting though puts a smile on your face, as you think of what happened to mademoiselle Antoinette.

Thursday, July 26, 2007

Application to become an investment banker

(Click on the image to enlarge)

This is how a real investment banker applies for a job.





Monday, July 23, 2007

Harry Potter and the Deadly Hours

Two investment bankers meet in front of the lobby of the firm in the dark of night. Not a sound is made, and in an instant, like cowboys in the Wild West, they whip out their blackberries, pointing them at eachothers’ chests. In a few moments. They recognize eachother and make their way quietly into the lobby of the firm.

As they approach the elevators, the doors open, and a managing analyst comes out of the doors. He is wearing thick rim glasses and has straight black hair, dropping over his forehead. His hair conceals a good part of his forehead, probably for the better, hiding from the casual observes the scars of a frustrated childhood that have through time made their mark – for this is, truly an investment banker. His name is Harry.

As Harry emerges from the shadows of the elevator, he is followed by two more bankers. The first is a jolly ginger haired young man, who would have been called Dufus has his name not been Ronald (“Ron”). Ron seems to be oblivious to the fact that it is 3am and that the trio is going out for some fresh air before continuing with some value added excel “magic”.

The third character to emerge from the lift is a brown haired girl, who in one hand has her blackberry, and in the other a handful of computer printouts from her magic excel model. She has obviously chosen to sue the fresh air break to continue working. To those who know her, her name is Hermione, but for most of the firm, she is “that chick in IBD”.

It is so that this group of excel wizard walk out into the fresh air. As they sit under the moonlight, the continue to zap magical spells into their blackberries, sending email commands to the lesser wizards that are still upstairs in the office working.

They take a moment to observe their surroundings and suddenly, they all turn still at the sight of shadows moving across the street. They see a light flicker in the distance – must be a cigarette being lit by the followers of the house whose name on must dare not speak.

Harry is well aware of the grave dangers that the firm and all its excel monkey wizards face in the wake of the house of Goldimord as he readies his blackberry for battle.

Friday, July 20, 2007

Investment banking and efficient markets

...continued from "The kind of shit that (often) happens in investment banking"

Having met Mike at the lifts, you head down to get a coffee. None of that cappuccino bullshit the silly little monkeys drink, and then ask for three shorts to make it stronger. You order an espresso - double. Mike has had a rough time - went home at four and was back at nine - he orders a tripple shot espresso.

"Oh, wait, make that a tripple shot macchiato - don't want to go overboard with the coffee"

Typical mike to hit it with a 200% and then retract to a conservative 100%.

Mike also notices the unwipeabl;e smile on your face, and smiles back.

"So, you're quitting or what?"

You chuckle as you think to yourself how great it is to keep everyone guessing. How can they all be so foolish. All they can think of is the measly exit! Amateurs. The lot of them. Don't they realize that there is a lot more to be had that a simple exit to anoter investment bank or some hedge fund? Haha.


You reply, amused at the puzzled face looking at you following your answer.

"So what's the deal then?" asks Mike "Why are you being so smug?"

"Mate, if you knew what I know, you would be smug too. What I know is going to make me Rupert's number one man, get me an early promotion, and basically everything I wan't, because I'll have little Rupert eating out of the palm of my hand"

"Hehe. Nice one, for a moment there I thought you saw Rupert with one of the secretaries or something and I didn't want to burst your bubble because that's common knowledge. But hey, sounds to me like you've got something good going here. I won't ask, coz it doesn't sound like you're going to tell. Good luck pal."

And that is how, as often happens in investment banking, you come across a dealbreaker and you're back to square one, as you start wondering who those voicemails on your desk are from.

...and the kind of shit that (often) happens in investment banking

... continued from "The kind of shit that (not so often) happens in investment banking"

You waltz into the office at around 10:30 am, feeling like you own the place in light of the information you acquired the night before, on your way home from work. You get to your desk, drop your things onto loudly, look at your phone, where the red indicator light is blinking indicating that you have voicemails, and choose to ignore it. You pick up the phone to Mike, one of your buddies in the industrial manufacturing group and arrange to meet him at the lifts for coffee. You take a stroll around the floor, saying hi to fellow monkeys and the secretaries, and stopping by to exchange a few (condescending, given that you are now a pro forma master of the universe) words with each of them.

"Don't you have work to do man?"

Asks one of the summer interns, who is religiously compiling annual and quarterly reports for the comps he needs to do.

"My man, you will learn. In time, you will learn... not to ask silly questions like that"

As you pass more and more people in the office, blatantly demonstrating the fact that you are really doing nothing, more heads start to turn, and you can hear the puzzled whispers as you pass each desk.

"Is he quitting?"

You barely make out the words coming from behind you, as you make your way to the lifts.

You chuckle, as you make out the words. Little do they know what is really on the table, you think to yourself and picture yourself turning around, walking over the the little naive monkey who asked the question and saying:

"Little man, quitting is for amateurs. For the guys that aren't good enough to stay. I am by no means quitting. Mark these words, as you are talking to the future department head... and when you know the kind of shit that I know, that won't be in the too distant future".

Wednesday, July 18, 2007

The kind of shit that (not so often) happens in investment banking

So you’re leaving the office late. It’s 1am as you get into a cab to take you home. Bonus paid, money in the account and no offer at hand, so you decide to drown yourself in workaholicism, in the hope that you will forget that seven of your fellow analysts quit today and there are a good few more to come over the next few days.

You can’t believe your luck as your taxi driver dims your lights, and when you give him a puzzled look, he turns on the intercom to the passenger cabin and says:

“You looked like you wanted some peace and quiet, so I figured I’d turn down the lights so you can get a kip guv”

You thank the good man and doze off with the views of the London Eye, Buckingham Palace and other central London attractions swiftly passing beside you.

As you wake up to see the cab sitting in front of your Chelsea, flat you dig into your firm branded gym bag for your keys. And again. And again, and with more agitation at each attempt. No keys. And again. Nothing.

You must have left them at the office. Damn it. When things are going so well, here you are, having to go back to the city, get your keys and lose another hour of sleep. Damn it in deed.

You politely ask the cabbie to take you back and you try to catch a few more winks of sleep which prove to be difficult as the cabbie decides to take you Through Mayfair towards the City.

You watch the crowds of party goers outside the cab, when a familiar looking face catches your eye. You look again in disbelief, and yes, clear as daylight, it is Rupert, hailing a taxi coming in the opposite direction. With him is… Noooo! It can’t be.


You think to yourself. The rumour potential of this is tremendous. It’s Rupert and Melinda, getting into a cab together. At 2 am!

Forgetting those keys in the office wasn’t so bad after all. Now this is how an hour of sleep can gain you an incredible amount of leverage. Who said that working late doesn’t have it’s benefits?

Monday, July 16, 2007

A New Beginning

Ok. So the news is out. Bonuses have been paid and the annual game of musical chairs is about to begin. You look around the floor, trying to guess who will quit in the coming days. You observe the analysts’ faces for signs of an upcoming resignation.

A few cubicles away, Pete Flannigan is a substantial deal more joyous than his usual chain smoking, grumpy, sleep deprived self. He’s sitting on the edge of his desk, merrily joking around with Friedrich von Blondehaare, who is actually engaging in non-work and promotion related conversation – also very out of character and suspect. What are these two monkeys upto? Whatever it is, it can’t be any good. It also surely is not the fact that they have been paid a lot of money just now, as once the cash is paid, everyone gets busy thinking about the fact that it will be a whole year of work before next bonus comes along – not a merry thought. No, indeed Pete and Freddy are up to something.

Thinking back, you recollect that both boys had pulled a few sickies over the last two months – Freddie had the flu and then a bad cough, followed by a leak in his shower which a plumber had to fix three times, each time, of course, requiring him to skip work for the day. Pete interestingly came up with the measles and also had plumbing problems. Pete also started coming to work in a suit, and even on days when he didn’t have a client meeting.

Ok, you think to yourself, so what. They went for a few interviews. Can you blame them? You interviewed with Blunderstone, didn’t you? So why should they not be allowed to test the market.

You smile at your open mindedness as you take another look at them chuckling away and firing funny glances around the office.

Damn it, enough of this “love thy fellow banker” shit. You take a dose of reality and remind yourself that these monkeys are probably sitting on offers from top tier rival banks or even a hedge fund or PE shop and here you are, sitting on your loyalty to the firm with diddly squat but your bonus.

You take another dose of reality and reassure yourself that you wouldn’t have even wanted to hold an offer from what are likely the third rate institutions they are going to. You work for the city’s premier investment banking firm. You are the best of the best, and the competition only tries to poach the best (you) and ends up with rest (them). Haha. They couldn’t even get to you, that’s how much of the best of the best you are. Haha you monkeys, chuckling there in your little corners, thinking that the three months of gardening leave and full bonus in your pocket plus the sign on bonus from the firm you jump to plus the possible one year early promotion you are likely to have gotten. Haha, you think you’re special. Well ha, you haven’t got loyalty have you, and as the firm says, you can’t put a price on loyalty.

You stop for another moment and realize that you are consoling yourself for your lack of an offer with the firm’s propaganda. How very, very sad. This means, there is only one thing to do. Shine those hand made shoes (or preferably get someone to do that for you), get a new suit done, new shirts, new tie and start interviewing.

Why can't investment banks take the shortest path from A to B

Failsafe Interviewing Techniques for Investment Bankers

Theres a great deal of paranoia when an analyst goes for interviews. This stems from a combination of the fact that ibanks promote a misplaced sense of loyalty to the bank you work for (lets face it, this is not a word that is in an ibankers vocabulary) and the fact that jobs open up and thus interviews happen shortly before bonus time, and no analyst wants to ruin their bonus by being seen as jumping ship (in which case they automatically drop to bottom bucket).

The first interviews are the toughest to deal with. Excuses like dentist, doctor, registered home delivery, plumber, electrician etc are common, and whilst they do arouse some suspicion, they are very plausible things that can happen to everyone.

The difficulty is in coming up with a credible excuse or rather, a set of excuses, when you need to do follow on interviews in a short period of time. Lets face it, three doctors appointments, two visits to the dentist and a broken boiler, fridge and blocked sink in the course of the two week period for you to meet every single member of the team at Goldman who is looking to hire you, is not an option.

Analysts, being the masters of bullshit that they have been trained by their bank to become, have through time developed more elaborate and effective tactics to avoid detection. So here are a few gems for your next interview. Enjoy.

a) Complain about back pains from sitting in front of a pc all day. Ibanks are paranoid about law suits of this kind and will immediately bring in a guy to replace your chair with a more comfy one and adjust the height of your desk so you feel just fine. Keep complaining and you get HR to pay for chiropractist sessions and not only that, but stress to the staffer that this is something he needs to let you take a few times a week. Bingo, you’ve secured yourself the ibanking equivalent of a hall pass.

b) Take up smoking, and go for regular cigarette breaks. Once you have developed a reputation for being away from your desk for the 20 minutes it takes to go down, light up and come back on a regular basis, when you disappear for 40 minutes to grab a quick meeting with a headhunter or interview, everyone will simply assume you are treating yourself to a ciggie and coffee.

c) Another benefit of taking up smoking is that you can catch bad colds when smoking late at night in the cold. Once said cold is established, you get up to two days to do interviews – yes, maybe with a bit of a runny nose, but it works.

d) In their second and third year, what is known as ‘managing analyst syndrome’ kicks in. This is when an analyst has illusions about being something in the banks and starts wearing a suit to work instead of a shirt and chinos. Whilst laughable, this attitude is a perfect smokescreen for going to interviews undetected – when you show up in a suit day after day, it will be much tougher to spot that youre interviewing (and thus wearing a suit) as this will be blamed on ‘managing analyst syndrome’.

For the less proficient interviewees, unexplained (or badly explained) absences, showing up in your best suit and you don’t have a meeting that day, smiling (ok, smiling on a regular basis) are all very good ways to spot a first time interviewee / leaver, so beware.

Thursday, June 28, 2007

Managing Analyst Syndrome

Now that it's bonus time, and every monkey (in many cases quite literally) gets a bonus. From top bucket to the bottom of the pile, a new generation of kids will be a few tens of thousands richer than they were a month ago. Investment banks in a bull market are very much like communist regimes in that sense - they don't really discriminate . Everyone gets a bonus and a pat on the back. The money is coming in, so why not? Sure, the top ranked get a few grand more, but then again, they get taxed more, and work more, so net, net it's all the same for every monkey.

Now here's the problem. When the i-bank does not discriminate between who deserves a bonus and who doesn't, and also, doesn't leave the option of no bonus on the table, every little monkey starts expecting a bonus. It is no longer a bonus, but part of the expected base. Anger, resentment and greed jump in when someone gets a bigger one than you do. Defensiveness or bragging (depending on the extent to which the given analyst lacks cultivation) kick in for the monkey in the top bucket.

In between all this wonderful emotion is born the managing analyst syndrome. It's a rather vile and most primitive manifestation of a junior monkey feeling like they have become a big bad ape by being able to say they're now an analyst 2 and not analyst 1 and can throw £1,000 on a night out. This is very similar to the "MD + Lambo = mid life crisis" syndrome, as the said MD is clearly overcompensating for the fact that when his wife left him (he was still a VP then), she told him he was a lousy father and an even worse lover before slamming the door in his face.

Enough words of wisdom for this beautiful Summer day and back to an i-banker one and only love - the excel spreadsheet.

Wednesday, June 27, 2007

Bonuses and Resignations

Bankers, for the most part, can be quite articulate people. It is a true shame that this particular one took seven years at a bulge bracket firm before sharing this talent with the world in a farewell email.

"Dear Co-Workers and Managers,

As many of you probably know, today is my last day. But before I leave, I wanted to take this opportunity to let you know what a great and distinct pleasure it has been to type "Today is my last day."

For nearly as long as I've worked here, I've hoped that I might one day leave this company. And now that this dream has become a reality, please know that I could not have reached this goal without your unending lack of support. Words cannot express my gratitude for the words of gratitude you did not express.

I would especially like to thank all of my managers both past and present but with the exception of the wonderful Sanjeev Hairsprayhead: in an age where miscommunication is all too common, you consistently impressed and inspired me with the sheer magnitude of your misinformation, ignorance and intolerance for true talent. It takes a strong man to admit his mistake - it takes a stronger man to attribute his mistake to me.

Over the past seven years, you have taught me more than I could ever ask for and, in most cases, ever did ask for. I have been fortunate enough to work with some absolutely interchangeable supervisors on a wide variety of seemingly identical projects - an invaluable lesson in overcoming daily tedium in overcoming daily tedium in overcoming daily tedium.
Your demands were high and your patience short, but I take great solace knowing that my work was, as stated on my annual review, "meets expectation." That is the type of praise that sends a man home happy after a 10 hour day, smiling his way through half a bottle of meets expectation scotch with a meets expectation cigar. Thanks Tracy!

And to most of my peers: even though we barely acknowledged each other within these office walls, I hope that in the future, should we pass on the street, you will regard me the same way as I regard you: sans eye contact.

But to those few souls with whom I've actually interacted, here are my personalized notes of farewell:

To Paul, I will not miss hearing you cry over absolutely nothing while laying blame on me and my coworkers. Your racial comments about Jack Cobain were truly offensive and I hope that one day you might gain the strength to apologize to him.

To Brandy whom is long gone, I hope you find a manager that treats you as poorly as you have treated us. I worked harder for you then any manager in my career and I regret every ounce of it. Watching you take credit for my work was truly demoralizing.

To Sarah, you should learn how to keep your mouth shut sweet heart. Bad mouthing the innocent is a negative thing, especially when your talking about someone who knows your disgusting secrets. ; )

To Bill (Mr. Cronyism Jr), well, I wish you had more of a back bone. You threw me to the wolves with that witch Brandy and I learned all too much from it. I still can't believe that after following your instructions, I ended up getting written up, wow. Thanks for the experience buddy, lesson learned.

Dan (Mr. Cronyism Sr), I'm happy that you were let go in the same manner that you have handed down to my dedicated coworkers. Hearing you on the phone last year brag about how great bonuses were going to be for you fellas in upper management because all of the lay offs made me nearly vomit. I never expected to see management benefit financially from the suffering of scores of people but then again, with this company's rooted history in the slave trade it only makes sense.

To all of the executives of this company, Jimmy Dumbass and such. Despite working through countless managers that practiced unethical behavior, racism, sexism, jealousy and cronyism, I have benefited tremendously by working here and I truly thank you for that. There was once a time where hard work was rewarded and acknowledged, it's a pity that all of our positive output now falls on deaf ears and passes blind eyes. My advice for you is to place yourself closer to the pulse of this company and enjoy the effort and dedication of us "faceless little people" more. There are many great people that are being over worked and mistreated but yet are still loyal not to those who abuse them but to the greater mission of providing excellent customer support. Find them and embrace them as they will help battle the cancerous plague that is ravishing the moral of this company.

So, in parting, if I could pass on any word of advice to the lower salary recipient ("because it's good for the company") in India or Tampa who will soon be filling my position, it would be to cherish this experience because a job opportunity like this comes along only once in a lifetime.
Meaning: if I had to work here again in this lifetime, I would sooner kill myself.

To those who I have held a great relationship with, I will miss being your co-worker and will cherish our history together. Please don't bother responding as at this very moment I am most likely in my car doing 85 with the windows down listening to Biggie.


Wednesday, June 20, 2007

Investment Banking Summer Intern Do’s

Wear a striped tie. Do also make sure that the stripes slope upwards. This is a bull market we’re talking about. None of that downward sloping off the rack limp ass shit.

Come in with a stubble after you’ve pulled your second all nighter in a row. Also, make sure that you don’t shower. This is the only way anyone other than the punk ass analyst who made you pull the all nighters in the first place (and got credit for your work) will notice that you haven’t slept and showered. Get noticed by a VP or above – just because you can’t be of use to these guys doesn’t mean you can’t try to get their sympathy.

Remember that you have not been hired for your ability to do mental arithmetic. If you need to calculate something, use excel. That’s what it’s there for. If you want to be a banker then start acting like a banker. Bankers can’t do maths. If they could, they would have been rocket scientists. 2 + 2 = EXCEL! For those moments you will not be at your computer, keep your trusted HP17B calculator handy.

Do impress your analyst, associate and MD by your ability to down tequila shots. You have a serious competitive advantage here. You’ve been practicing at university whilst they’ve been doing deals late at night, so you will outdrink them. This will remind them of the days when they went out with mates at university. You will thus remind them of the fact that they had a life before banking, and this will make them happy. So, drink like a true student, and you will be in your team’s good books.

Leveraged Buyout - a la Carte

No comment is really needed. Monkey will keep this in mind in the next private equity interview.

Do monkeys on the trading floor get a better deal

You get asked whether monkeys on the trading floor get a better deal than monkeys in IBD. Interesting. You think for a moment...

A typical junior banker will say that of course a trader didn't get the betetr deal. Come on, they wake up when its still dark, they don't get to make headlines and shape the futures of corporate America, England, Europe or wherever and they are far more likely to suffer from erratic moving eyeball syndrome from being glued to 12 constantly flashign screens which they need to monitor.

Ask the same banker five years later, when they have lost all preconceptions about being a master of the universe, and you will hear the recognition that despite getting up when its still dark, they do get to go home when its light (and not because they're leaving the office at dawn after pulling an all nighter).

Also, the 12 blinking screens are usually coupled with a Lambo or a Ferrari parked outside, so in that light, they don't sound so bad.

Also, you just need to look at the price of Trader Magazine - £10! £10!!!

Last time you checked, Financial News was going for a third of that.

So there's some food for thought.

Wednesday, June 13, 2007

…and Some More Investment Banking Summer Internship Donts

Don’t diss the competition:
Many a smartass summer intern (see “Don’t be a Smartass”) try to impress their loyalty to their chosen firm by putting down the competition. Don’t. You never know whether your analyst who thinks quite highly of you is waiting for his bonus before moving to shitty, Goldmen or Moron Stanley. Don’t ruin your chances of getting a call to move once they jump ship just because you dissed the competition.

Don’t aim too high:
An anonymous banker highlighted that you shouldn’t suck up to your MD or VP. Correct. You should aim lower, and suck up to your analyst, because it’s their job to suck up to the associate, whose job it is to suck up to the VP and so on. Don’t forget the hierarchy.

Don’t forget you’re there to support:
And that means support. Carry an extra tie with you, just in case your analyst get called to a meeting and the chino wearing shit needs one. Make sure you’re the same build as your analyst, so he can also borrow your suit if he needs one (if you’re more buff than said analyst, stop going to the gym – this will give you added points as you will soon lose your athletic build and become less intimidating to your analyst). Always carry shoe polish, in case said analyst’s shoes need a shine. Forget your blackberry holster – what you need is a coffee cup holder for more than four cups – this way, you’ll need only make a single trip to Starbucks each morning when you bring your team coffee.

Saturday, June 09, 2007

Investment Banking Internship Donts

You sit thinking, what don’t you want to see in a would be analyst, running about the office during the summer, and you realize that you cant stop at a single thing. You’ve seen your fellow interns last year so things that made their analysts cringe, and you’ve head a fair share of analyst war stories to be able to draw up a comprehensive list of intern donts. Not from the goodness of your heart, of course, because as every prospective ibanker should know, now that you have permanently infiltrated the ranks of the investment banking full time professional staff, your heart was one of the first things you had to check in before they’d let you into the building. No, you do it in anticipation of getting an intern of your own, so you type up a list of things you don’t want, to save you the time of explaining it to some overenthusiastic (or more like overly confident little shit given the fact that firms are hiring every Tom, Dick and Rupert with a pinkie ring now that the market is booming) intern.

Don’t be a smartass:
Too many little wannabe bankers try to look smart. You were not hired for brains. Your job is to perform manual (excel, powerpoint, Xerox) labour. You’re getting paid a hell of a lot of cash for doing a hell of a little value add, so you’ll be expected to put in the hours, not the brains.

Know your place:
It doesn’t matter that you have tailor made suits. Don’t wear them as your analyst (who’s probably got a massive chip on his shoulder) doesn’t. Don’t go as far as a polyester wrinkle free from M&S, because then even the biggest schmuck with a massive dent on his shoulder will laugh at you. Never dress better than your analyst, but make sure to not dress far worse. If he wears Hermes ties, you go for Ferragamo. If he comes in on the weekend with a Diesel tshirt (bankers like to think they’re hip), come in wearing something from GAP. You get the picture.

Make them look good:
You should expect your analyst to take credit for your work, and they will do that. When it’s god, it will be theirs, when its wrong, it will be yours. Don’t try to make the VP see that you were the one doing a piece of work – because you will get the shit in any case once they figure out its wrong. Oh, and by the way, your work will always be wrong. At best, it will always be something that can be improved. Think of your analyst like a shot of tequila. Salt, lemon and you slam it. Again, and again and again. Look on the bright side, it’s only for the summer.

You will know you are not smart:
Know this in everything you do. Your analyst will give you shit because you messed something up. Say thank you, as you’re really not that bright. You will complain that you haven’t gotten much sleep. You’ll get told to be more efficient and it takes you too long t5o do stuff, because you’re not altogether that bright. Let’s face it. You’ve signed on to spend your last free summer before beginning a lifetime of work with a bunch of boring, arrogant, overworked and underlived cube monkeys for what ends up being minimum wage on an hourly basis. They know it, you know it, so live up to it.

Good luck.

Wednesday, June 06, 2007

Investment Banking Summer Intern Success Guide

By popular demand you have been asked to provide a summer intern success guide. As many of you know, recruitment season has long past and it’s time for the fresh monkeys to crawl down from their penultimate year university trees, put on their best suits, shirts and ties and walk through the doors of the investment banking powerhouses.

A voice in your head wants to say “shut up”. Interns are nothing like what they used to be. Hard work is replaced with networking. The kind of guy who worked hard and learned how to comp and do price charts with weighted average trading prices superimposed in the hope of eventually being given the honour of doing a DCF (to be read as if DCF was written in fort size 100, Arial Black and bold) – well, this kind of guy is replaced with the chimp who messes up any numbers job he’s given on purpose (even though he’s a maths and physics joint honours student)so that nobody will ever think of giving him anything numbers related to do. Instead, this guy has beers with Rupert in the hope of landing the full time offer by drinking him under the table with Tequila shots.

You think to yourself… do these guys really need an intern guide? I mean come on. These are kind that have read every single vault guide. Kids who pay good money to get valuation skills even before they step foot inside an investment bank. Kinds who wonder whether ones tie needs to slope upwards (if striped) given that it’s a bull market?

To cut a long story short – YES THEY DO. The market is more competitive than ever, that with all these little cowboys running around like a bunch of consultants, clocking higher BPMs (see glossary) than some VP level bankers, it will be the skill set one cannot learn from online valuation training or the vault that will land them the job. So, ladies and gentlemen, get ready for a new series of All Nighter posts on successful interning

Friday, June 01, 2007

What does £27k mean?

With the month of July slowly approaching, comes the anticipation of the first bonus. Man o man will you not be the envy of all your friends when you wake up on that glorious day in July, get ready for work and check your bank balance at the first ATM and wow. The numbers will go on and on and on and so will the smile on your face, thinking “it’s all worth it!” – that is, until your blackberry starts going off like mad, from the flurry of emails a client starts unleashing.

But that’s looking too far into the future. For the moment, you can just look forward to the cash. As you spend most of your downtime pondering on the cash, you run countless combinations and permutations of what this money really means.

Sounding your buddies at fellow bulge bracket banks, you know you can expect something like £45,000, before Gordon Brown slashes an automatic 40% off.

Ok, so £27,000 is not bad at all!

You can go to Selfridges and buy five Bang & Olufsen TVs (bedroom, dining room, bathroom, kitchen and study) and still have some cash to spare for a night out on the town. You can get yourself half a dozen good tailored suits and have some change for a pair of hand made shoes or two. You can take a long holiday around the world in first class (hehe, if you had the time) and have money to spare when you got back. Ok, you could do loads, but really, what does £27k mean?

Would you pay £27k for a full month of blissful, uninterrupted, mobile-less, blackberry-less holiday time? Sure. Wouldn’t anyone in i-banking. Gladly. You sit down to do the maths and realize the gravity of what you have just said.

Basically, as an i-banker, you are marginally better off than if you were receiving minimum wage, and not only from an hours point of view, but from a personal willingness to give good money to be left alone point of view.

Ok. Enough of these silly thoughts. You head to the bathrooms to splash cold water on your face and start thinking like an i-banker again.

Frank Johnson posts again

You can hardly believe that Frank Johnson posts again. Evidently disillusioned by the departure of his junior to Blunderstone. You never thought you would empathize with Frank Johnson, but on this one, you have no choice. You never thought you'd say this, but... "Frank Johnson, I hear you".

Reich Bank Equity Research

You are overjoyed to come across an equity research report on one of the companies you ahve been asked to research. Excited by the fact that someone in the research community has done your work for you, and to add to it, in an unbiased and objective way, you start reading...

Thursday, May 31, 2007

Investment Banking is like Pac Man

This goes to prove that the best i-banking training is received not on the job or in organized training prtogrammes, but on the internet.

Wednesday, May 30, 2007

Damn, this kid has got issues

So, today is the day HR assigns mentors to analysts in the starting class of 2007. All the bright, starry eyed graduates are in their best suits, in the lobby of the firm’s headquarters, with bright shiny nametags stating the firm name and a big smiling photo of the fresh from university analyst. Little do they know that these smiling photos will serve them as reminders of the life and enthusiasm they once had, when they compare it to the face they see at 4 am in the elevator mirror.

Their shirts are super starched, their shoes are so shiny, you can see your reflection perfectly in them. Everyone has a fresh haircut and looks sharp. First day as an investment banker is a day to impress.

You make your way to the reception area and look through the numerous nametags until you find your assigned mentee. There’s a huge smile on this guy’s face, that you almost want to run up and put on a pair of shades to protect your eyes from the glare coming off his freshly polished teeth. After an overly enthusiastic handshake, you introduce yourself, and learn that it is such a pleasure to meet you. He has always wanted to rub shoulders with the high and mighty investment bankers like yourself. How exciting. You scratch your head, wondering what this kid is on. You certainly don’t have the same level of enthusiasm each morning when you look yourself in the mirror. Sure, you look like an i-banker, you sound like and i-banker, you dress like an i-banker, but so does every other i-banker! As is that a good thing?

Damn. This kid has got issues.

Being asked about how he sees his career moving forward at the firm, the kid breaks into a monologue about how he’s always wanted to work at this firm, with some of the greatest bankers on the street, learning from the best, working with the best, chilling with the coolest, and serving the richest. This is his dream and he’s finally going to live it. Amazing.

You decide to change tact, and ask him about his spare time and what he likes to do with it, as you desperately struggle to find anything you may have in common with this poor misguided kid. You realize, however, this kid has no hope when he tells you that he likes to practice financial modelling in his spare time so that he can be a better analyst when he starts. Weekends? Catching up on all the articles in the week’s Financial Times that he didn’t have time to read.

Ok, change of track once again. You ask him about networking, fitting in and how he sees himself in the firm’s corporate culture and that’s when a ray of light appears. The big smile is replaced with a serious face, as he intimates that this is something he would very gladly have your advice on. He has heard that declaring oneself as a minority banker in whatever way, adds value to you as an asset of the firm, as investment banks are keen on maintaining diversity in the workplace.

He reckons, though, that a single minority is simply not good enough, so he wants your advice on how to do a double combo, slotting himself into two or three categories. His plan, is to become active in two ethnic minority programmes at the firm from day one, and also join the gay and lesbian group organised by HR. What he wants from you – to give an opinion on how “unfireable” this would make him!

So here you go, this kid who has gotten custom designed stripes on his neckties, so that they slope upwards as it’s “a bull market” does have a sense of humour – albeit not being aware of it himself!

Damn, this kid has got issues

Friday, May 25, 2007

Computer games reinvented for i-bankers

No comment needed. Just walk to the closest HMV or Virgin Megastore and buy your copy. What? Surely you mean, just drop that excel spreadsheet, log onto amazon dot com and order your copy. What a silly thought, going out of the office in broad daylight!

Investment Banking: Competence revisited

Now that you’ve recovered from the shock of Kruelberg Kretin losing the deal of the year, the indignation of losing that job at Blunderstone for that very same reason, you decide to get on with your life, move on, and start crunching a new set of financials for a new dipshit client.

A long term client of the firm, who has grown to be a technology leader in the IT field wants to acquire the industry leader, who is one of the best established firms in the entire sector, a monster of a company, listed on the NYSE with a second listing on the LSE. Oh, and one more thing, this company, call it the target, is ten times larger than the client, call if the acquirer.



You think to yourself quietly as you stare at the blank excel spreadsheet on your screen. The project has just started, so you have been asked to draft a checklist of tasks that will be required to get the work off the ground. According to the staffer, this is part of your development and you are being given the opportunity to “step up”. This translates, of course, into, “as I, the staffer, am meant to be doing this, and really can’t be bothered to, I will ask you to do it by stepping up and doing my work for me”. Reflecting on this deeper meaning for a moment, you come to the conclusion that if you ever had a doubt as to whether the word staffer was synonymous with a piece of shit, there is clearly no doubt any more.

So, you begin to go through what would be necessary to make this project happen. Ok.

You will need comparable companies and precedent transaction analysis for the sector. You will doubtless be required to prepare these. You will then format them nicely. You will then look at what the mean, median, top and bottom quartiles are, until you come up with the number that makes the target’s multiple lower and the acquirer’s higher. You then take this number to your associate and claim success.

You will also need to build DCF (discounted cashflow) models for both the target company and the acquirer. Ok. That’s easy. Both are public companies and have equity research available. You will look at the equity research reports for both companies and find what the consensus valuations that research is predicting are. You will then work back from these valuations and build the models accordingly, from end to beginning, until you have backsolved to the tiniest and most painstaking detail every assumption to magically get to the desired numbers. Once you have done this, you will go to your associate and claim victory once again.

Then, you will use the valuation you have for the target and that for the acquirer to figure out an exchange ratio. This is the number of shares of the acquirer (at the valuation you have “calculated”) that the acquirer will give in exchange for each share in the target (again, at your “valuation”). Simply put, the acquirer will ask the shareholders of the target to now hols its shares instead of the target’s shares they have been holding until now.

Ok. Next step, the shareholders will likely refuse, realizing how much bullshit has gone into the valuation and will ask for hard cash instead of some worthless shares. There will be a crisis moment, and the valuation will “magically” improve. As the shareholders of the target will still only accept cash, rather than throwing in the towel, Rupert will come up with the idea of raising the money needed to buy the target through debt. Why, because that way he gets a percentage of both the full value of the whole deal (hence the inflated valuations) as well as an even bigger percentage of the amount of debt raised. One slight problem. The acquirer will need to raise debt to the tune of ten times its actual size, which is…well…impossible. So, you will spend a few weeks running numbers on how divisions can be sold to raise cash, calling hedge funds to provide money and so on, until Rupert, who will have come back from holiday, will finally focus on the matter at hand, and officially recognise that this is not doable, and thus will tell the client that this idea will never work.

Minor correction actually. This wasn’t the client’s idea in the first place, so Rupert will not call the client to pitch the brilliant idea.

Now isn’t i-banking the beautiful game or what.

Thursday, May 24, 2007

Another Investment Opportunity!

From :
ibrahim munsa
Reply-To :

Sent :
Wednesday, May 23, 2007 11:12 PM

Subject :
Reply me immediately.


Attention please,

I am Dr. IBRAHIM MUSA,The bank manager of BANK OF AFRICA (BOA) BURKINA FASO WEST AFRICA BRANCH. MY CONTACT CALL 0022676283191. I am contacting you based on Trust and confidentiality that you will keep this as top secret.don't be scared or surprised, i am the manager of BANK OF AFRICA and i have an opportunity to transfer sum of US$152.MILLION (ONE HUNDRED AND FIFTY TWO MILLION UNITED STATE DOLLARS) I have the courage to look for a reliable and Honest Person who will be capable for this important business. Transaction,believing that you will never let me down either now or in Future. The owner of this account is JOSEPH F. GRILLO, foreigner and he is the Manager of petrolchemical service, a chemical engineer by Proffession.He died in world trade center as a victim of the September 11,2001 Incident that befall the United State of America, the bank has made series of efforts to contact any of the relatives to claim this money but without success, you can confirm through this website:

And my investigation proved to me as well that his company does not know anything about this account.I want to transfer this money into a safe foreign account abroad but I Don't know any foreigner,I know that this message will come to you as a surprise as we don't know ourselves before, but be sure that it is real And A Genuine business.Hope that you will never let me down in this transaction, at the conclusion of this business, you will be giving 30% of the total amount, 70% will be for me. I look forward to your earlier reply byemail for more details



Wednesday, May 23, 2007

The lighter side of Rupert

Rob gets a piece of "work" from the new intern and gives him this markup. That night, Rob finds the second markup sitting on his chair - "from Rupert!" Damn. Interns. They don't make them like they used to!

When in Rome…

You’re sitting in Rupert’s office, chewing the fat with this BSD that you almost feel like you can call a colleague! Nothing has been said yet, but you know it and everyone else knows it – you’ve got a job with the firm. You feel like a million fucking dollars (worth of bling handing off your neck) as you sit across the desk from Rupert, who after spending the first half hour of your meeting in his office with his feet outstretched on his desk, has now decided to take off his shoes, and throws them in the left hand corner of his enormous desk. Amazing. You’re so trusted by this BSD of BSDs that he does not feel the need to exhibit even the most basic of courtesies with you any more (which is to refrain from sharing with you the stench that fills the room as his freaking feet come into contact with the crisp air conditioned air). He’s wearing £80 a pop cashmere socks that were sparkling new, clean and not embarrassingly thinning at the heels (to the extent commonly known as a hole) at some date. You can’t make out if the colour is really grey or whether they have absorbed bits and pieces of the surroundings and metamorphosized into that form at some point. You just can’t get it. No matter how important they are. No matter how much of a BSD they are. No matter how much money the make and how much more they have, i-bankers of the Ruppert McMuppet breed are the stingiest fuckers in town when it comes to personal hygiene and items of clothing that they think nobody notices.

“Give me a fucking break Rupert” you think to yourself. As you sit there awestruck by the conflicting thoughts of admiration and disgust, the telephone rings on Rupert’s desk begins to ring. He gives the number on the little screen a glance and grumbles.

“It’s those fuckers from Goldmen. Let’s make them feel welcome – I want to get a piece of that underwriting they’re doing for FuckedCo next week”

Rupert looks you directly in the eyes as he says this and captures your glance, holding you hooked to every movement of his body as he picks up the receiver. He winks as his mouth opens, almost telling you “this is how its done”.

“Shalom!” he hollers as he gives you another wink.

Now that’s how it's done - and incidentally, you are now sure beyond a doubt that Rupert has no shame.

Monday, May 21, 2007

Responding to an Investment Opportunity

This is how an i-banker negotiates...

Sent :
Monday, May 21, 2007 11:29 AM
To :
Subject :

Dear Mr. Musa,

Thank you most kindly for the email you have relayed, which is attached hereunder. It is with much joy that I read your email. It is truly amazing that you have found my contact details and I am most grateful that you have decided to contact me. Engineer Steve Moore (Snr.) is my uncle. He was working in Africa for some years, and we have lost contact from him.

Whilst it is unfortunate that you have not been able to find relatives, is today not a great day, as you have found a relative - and the US$30 million will not need to go into the ammunition fund! Please email me your contact details so i can give you my banka ccount number, to which you can transfer the full US$30 million.

What a fantastic day for everyone!

All the best!


Friday, May 18, 2007

Investment Opportunity

An an investment banker, one is constantly offered fantastic opportunities to make money. You are overjoyed to find the gem below in your inbox:

From :
us musa
Reply-To :
Sent :
Friday, May 18, 2007 12:43 PM
Subject :






Reich Bank Equity Research

Click on image to enlarge.

The Kruelberg Kretin Saga XV - Frank

The nerve of the guy. He's set up his own blog!!!

The Kruelberg Kretin Saga XIV – Blunderstone calls back

Your mobile phone rings. Withheld number. You cautiously pick it up.


There is a brief silence, before you hear the unmistakeable voice of Pete Anderson from Blunderstone.

“Hi, it’s Pete from Blunderstone. Can you talk?”

Wow! Blunderstone. Not calling through a headhunter. Calling you direct. This is it. They want to give you an offer. They’re gonna do it on the spot. You know it. You can feel it. There’s a good reason Frank fucking Johnson lost that deal. It was so that Blunderstone can get it and on that high note, hire you to look after the company for them. What a day! Pete Anderson!


You fire back with the enthusiasm of a five year old who’s about to unwrap its birthday present.

“I’m afraid I don’t have any positive news for you. I wanted to call you in person because you really made a good impression, but we’ve decided to fill in the position with someone with more experience in private equity. We’ve hired a guy from Kruelberg Kretin, who worked on the transaction we announced today. He was so disgruntled working for some prick called Frank Johnson who led the deal at Kruelberg, that he was willing to accept much less favourable employment terms than you. You’re a good guy, and I like you, but this poor guy was willing to do anything to get out of Kruelberg.”

Frank fucking Johnson. You’ve done it again you #@%!*$$£~#.

Thursday, May 17, 2007

The Kruelberg Kretin Saga XIII – Frank Johnson, you suck!

2:00 pm - Bid deadline (9:00 am NY time)

Bid letter:
Done, drafted and sent to Kruelberg Kretin to put in the final number (Frank doesn’t trust his bankers with shit like this), which he has done, and it has been faxed to the seller.

Bank letters:
Done. All done, credit approved and ready to go.

Frank’s dummy proof database:
Done. Even Frank can’t be caught off guard with this one.

None. It’s for fucking wimps when the biggest private equity deal is in question. Running 36 hours and ready to run some more for that sweet fucking tombstone.

3:00 pm (10:00 am NY time) – no news from Frank

4:00 pm (11:00 am NY time) – no news from Frank

5:00 pm (12:00 am NY time) – no news from Frank

6:00 pm (13:00 pm NY time) – no news from Frank

6:23 pm (13:23 pm NY time) – no news from Frank – Reuters newsfeed hits the wire:

“Blunderstone does largest private equity deal – NY: Blunderstone, the leading private equity house, advised by Shitty Corporate and investment Bungling and Reich Bank has announced that it has been selected as the winner in the highly contested tender that has been making headlines for weeks. Reportedly, Kruelberg Kretin, the favourite contender in the process, reportedly presented an offer that fell well short of the seller’s expectations”

Frank fucking Johnson you’ve fucking done it fucking again! You’ve fucked it up and stolen the sweet, sweet tombstone. You suck!

Wednesday, May 16, 2007

The Kruelberg Kretin Saga XII – It's All Worth It

There are many things that bug you as an i-banker. The fact that HR leaves at five and you have to crunch useless numbers for Frank fucking Johnson in the wee. The fact that your client is a moronic self important moron who got a lucky break despite the fact that he can’t tell his arse from his elbow. The fact that he wants you to run countless iterations on countless financial models, using structures that have been proven not to work countless times before, despite being told all this countless time. The fact that your boss is so spineless and focussed on the big picture, that he doesn’t care if you do one more useless all nighter as in the grand scheme of things, what’s just one more night of useless modelling in the span of an analyst’s career? It’s all for the greater good, he says. Just think of that shiny tombstone you’ll get when this deal closes, he says. Just think of the money the firm will make, he says.

You ponder on the glory of the tombstone sitting on your desk, which would magnificently state that the firm advised Kruelberg Kretin on the acquisition, paying billions for the company and setting a landmark in being the largest private equity deal ever in the sector. And this will be on your desk. You will be the superhero analyst who worked on the deal. The deal? You must mean THE deal.

You breathe in the fresh air (it’s so much better after 2 AM) and as you close your eyes, you can see the envy in the faces of your class as they pass your desk. They will see the tombstone and stare at it, wanting to have that tombstone. Wanting to share the glory. Wanting to have been part of this groundbreaking deal. Well, wanting to be in your shoes, right here, right now, freezing your ass off in front of the entrance, chainsmoking three Marlboro reds before you head back to the office. Wanting to be the ones doing that useless bit of work for Frank tonight.

You pause for a moment and think again. Really? Wow! These guys are envying me as we speak. You are filled with energy as you feel their envy all around you. You wave to one of your buddies who is heading home for the night, feeling sorry for the poor loser, going home only at 2AM, whereas you will still have the pleasure of spending a few more hours at least, making this landmark deal happen!

You take a final drag out of cigarette number three, stub it out, rub your hands and put your war face on, ready to finish the job for frank. Tomorrow’s bid day and all the work is done. Frank has, however, asked the firm to provide him an easily accessible database for all the deal docs, models and analyses in excel - in case he gets a call with questions about Kruelberg’s bid tomorrow, he wants to be able to punch in the keyword like in a google search engine, and the spreadsheet to pop open the right analysis. Now most of those unlucky colleagues would just call him an asshole, but you know better than that, given that he will be your path to glory. He will be your stairway to fame, with a tombstone for the biggest private equity deal in this sector, ever, on your desk!

It’s all worth it. It is all so worth it! Forget the fact that all those other guys are getting paid the same as you. Forget the fact that they are all working far less than you. Forget the fact that the work they are doing is far more interesting than the shit you have to do for Frank fucking Johnson. Forget the fact that they don’t give a shit.

It’s simply just worth it!

Saturday, April 28, 2007

Tired? Need Sleep? Want a Break?

If you see something rotating – go home, you need a break!

Recent studies suggest that the current economic meltdown is taking a toll on America's best and brightest, producing record numbers of bankers, attorneys, and executives seeking help for depression. So, if haven't been working hard and the circles are still spinning, get some help!

Click on image to enlarge.

Wednesday, April 25, 2007

Investment Banking Recruitment Clips

Tuesday, April 24, 2007

Bulge Bracket

What does a Junior Investment Banker do?

In addition to being on the company brochure, you get asked to present in front of a group of prospective interns who are coming to visit the firm tomorrow. You get given the boilerplate firm standard slides, so you decide to make some notes to amke sure you get it right.

Click image to enlarge.

Monday, April 23, 2007

Why Senior Bankers Don’t Retire: The BA Black Card

It’s the second week of the month and Wednesday, which means its time for the European firm wide meeting and conference call at 8:30. The meeting takes place across all the European offices of the firm by audio / video conference and in the main amphitheatre in London. This is the one occasion an analyst has to be seen by senior management, so rain or shine, one wears ones best suit, best shirt, buffed shoes, combined with a clean shave and haircut. These guys don’t care about pulling allnighters. Been there, done that, and got plenty of T-shirts. They are the most important partners in the franchise and they make organization spin.

They passed the point where compensation was important long ago. They all sit on personal fortunes substantial enough to not have to work ever again. They are almost all former analysts and associates of the firm, who rose through the ranks and gained the respect of the organisation in record time. They are, in short, the pride and joy of the firm. Its present, its past and its future. They are the deep bench of talent that will take the firm from great to greater and beyond. They are also barking mad.

For guys that don’t ever need to work again, these guys are pretty damn gung ho about generating revenue for the firm, seeing clients and getting on a plane to fly halfway around the world to attend a one hour meeting and then getting the next plane and flying halfway round the world back. Do they need to be in the meeting? Not really. Are they indispensable? No. Would anything change without their presence? No. Ok. These guys evidently don’t need to be at ten different places at one time for the good of the firm. No.

Ok, maybe its frequent flier miles. They’ve gone from blue to silver to gold BA cards and they need to be in the air 24/7 to finally get an invitation for that coveted BA black card. Yes you got it. Black card. It’s not on If you ask the helpline about an upgrade from your gold card, they’ll say that there is no such thing. But believe you me there is. The black card is by invitation only, and was set up in the old days, when bankers and executives used to jet back and fort across the pond on Concorde to New York. It gets you through immigration, security and the works along with the crew. More fast track than the fast track (although with BA nowadays that isn’t to hard to achieve if you fly from terminal 4 at Heathrow). Having said that, you’ll probably still get asked to take out your toothpaste and mouthwash by security even with a black card.

Delving deep into the senior banker’s psyche, you begin to understand. These are hotshots that have risen from height to height, from the humble level of analysts. The images of some shithead associate telling them to check the book for typos and telling them to triple check the net debt on that one comp because it can’t be right are hard to wash off. Not even when they themselves became that associate and handed down shit of greater magnitude to overcompensate, could they wash that off. Not even as EDs and MDs could they wash it off, because no matter how high they climbed, there was always someone higher up to shit on them. Now that they have reached what can in most mortal terms be called the op of the investment banking pyramid, there are always the clients whose asses they have to kiss ahead of them, and even worse, the shareholders! So now you understand, how a little black BA card is the holy grail for these creatures of finance. It is the key into the exclusive world of the uber executive where few clients are able to tread. Where not many a stockholder can reach them. Where, when they get asked to take out their toothpaste, deo and mouthwash at Heathrow airport, it will be with the knowledge that the person asking them to do so knows what a superfluous request this would is - these are the true BSDs. They don’t need deo, a toothbrush and mouthwash. They don’t carry luggage. They jet from city to city, attend meetings and jet right back. They are the true masters of the universe. They are the BSDs that sit on the other side of the line that separates the mortal world of investment banking and the twilight zone.

Sunday, April 22, 2007

Sartorial Tutorial

Waiting for a batch of presentations to print at the print room so you can go home, you scroll BusinessWeek for something worth poking fun at, when you come across an article giving sartorial tips for would be investment banking job candidates.

The article reads that you need to spice up a dark pinstripe and white shirt with a power tie in maroon or red. Being rather taken aback by the fact that a someone is recommending wouldbe investment bankers to look like essex boys with a makeover, you finally get over the fact that the you are most displeased at the mediocrity of the suggestion. You take another look at the picture of what an investment banker is supposed to look like, and you decide you've had enough. You write to BusinessWeek, suggesting they check with The All Nighter's article on How I-banking is like Barbie for the true i-banking look.

You dread seeing an army of intens this summer marching in in black tacky pinstripes, white shirts and maroon ties, so being the constuctive, problem-solving, thinking out of the box, individual that you are, you venture out for more on the investment banking look.

The phone rings, and its a call to let you know the books are ready. You go downstairs, pick them up and grab a cab to deliver them to Rupert for his meeting on Monday. It being a Saturday, you decide to do some proper shopping along the way. You decide to shop for the perfect i-banker candidate outfit, take a picture of the finished product and plead with BusinessWeek to revisit their suggestions before it is too late.

First stop, get a tie. Now you may be thinking that Hermes on Bond Street is pit stop number one. No! An intern should never wear an Hermes tie. This is a privilege for full-time employees of the firm. Also, when the intern performs well, by already owning an Hermes tie, they take the boss's pride away, when they buy them an Hermes tie at the end of the internship. So off to Old Bond Street and to ferragamo you go, getting off on Regents street and instructing the cabbie to wait.

You walk into the Ferragamo shop on the corner and browse through printed silk ties with the unmistakeable Ferragamo pattern. Not large and distinctively in your face enough to be a Hermes, but a tuch more geometrical and smaller motif size. Perfect for the intern. From far, the tie looks unobtrusive and will ward off comments from other jealous interns about the intern in question splashing his money around, whilst obvious enough to the trained analyst eye to signal that said intern has potential to upgrade money spending skills to higher ticket items. You finally pick out a fairly neutral bluish piece and take it to the counter.

Next stop, up the road to Ralph Lauren. Perfect place for an intern to get a shirt. You walk into the multi storey store and head straight to the first floor, where the purple lable stuff sits (if one is to buy a pony and polo player emblem shirt, one might as well go to NEXT or the GAP). You look around until you find the right piece. Creamy white, full cutaway collar, cuffed to appeal to a Brit interviewer and just about perfect. Happy with the selection you make your way to the counter.

Next stop, shoes. Off to the King’s Road and Tim Little for a pair of hand made shoes. Keep them clean, conservative and a perfect fit. Yes, perhaps the £1,350 tag is a tad much for a single pair, but you are soon comforted by the fact that the next pair will cost less. You are also comforted to see that the heels are not fully coater with rubber (only the corner in the back). You sit for a measurement and spend another two hours finalizing the style and walk out with a smile on your face, knowing that in a few weeks your brand new shoes will be ready to wear.

Happy with your day’s purchases, you tell the cabbie to take you home. You get a call from Rupert whilst in the cab, asking why the books are so late. You explain that the cabbie got the address wrong, and came back, so you had to call another one and send them again. Perfectly reasonable and having reassured Rupert, you get out of the cab, confirm the delivery instructions and get home.

Final touch. You call your tailor to confirm an appointment for Monday. He’ll come to the office. 10AM.

You recap on the day’s work. Damn it feels great to be an i-banker.

Tie. Only £70?
Shirt. Below £200 Bargain.
Shoes. Hand made for £1,350.
Looking like an Investment Banker. Priceless.