Barclays

If you like delayed gratification you’ll love the payment plan management has come up with. Read more »

It’s getting to be a struggle to be amused by Libor manipulation chats. RBS took its lumps today, and the CFTC and FSA orders are full of quotes, and you can read them in various round-ups, but, meh. Even Bart Chilton is bored; today’s imagery (“sends a signal to those who would monkey around with benchmark rates … much more than a slap on the wrist …”) is a letdown after his UBS masterpiece (“Financial sector violations are hurtling toward us like a spaceship moving through the stars”) just a few weeks ago. I get it! Everyone manipulated Libor! In writing! And then they were like “heh, fukin awexome man, u manipluated libor, gud work, i sexx u now, w champain.” Fabulous.1

Part of why RBS provides less delight than its predecessor Libor-settlers is that RBS made use of the oldest and most reliable way to avoid typos: not typing. From the CFTC order: Read more »

  • 06 Feb 2013 at 9:12 AM

Layoffs Watch ’13: Barclays

The Brits are said to have alerted some staff that their services are no longer required at the bank. Read more »

We’ve talked a lot about bank capital today but there’s still time for one quick addendum. First, though, two rough-and-ready equations:

  • Capital = cash paid in by shareholders plus retained earnings
  • Capital ratio = capital divided by assets

The first equation explains my puzzlement at the claim that Deutsche Bank “book[ed] a loss to boost its capital ratio without selling shares;” it’s arithmetically impossible to boost your capital by losing money, though you can (separately) boost your capital ratio by fiddling with the denominator.

The important thing about the second equation is that, for banks, the ratio is well under 1. So if your capital ratio is a relatively robust 10%, that means that 90% of your total assets are funded with borrowed money, and 10% are funded with cash from shareholders and retained earnings. Some people dislike this system.

Anyway there are various semi-magical ways to monkey with the denominator but there is one simple and obvious way to monkey with the numerator – the actual amount of capital that you have – and it is this:

  • Take some money,
  • dress it up in a fancy costume, and
  • issue some new shares to the the now-cleverly-disguised money.

You have magically transformed Assets (money) – which, remember, are 90%+ funded with borrowed money – into Capital. This has perpetual-motion-machine properties,1 so it’s pretty good.

Also it is, like, wildly wildly wildly illegal. Or, I mean, it’s pretty illegal as I just outlined it above, but if you put a fancy enough costume on the money maybe that makes it okay.2 Anyway draw your own conclusions about this: Read more »

  • 24 Jan 2013 at 2:33 PM

Layoffs Watch ’13: Barclays

Earlier this week Barlcays promised not to dawdle when it comes to canning the 2,000 employees slated to be cut. Today employees in Asia got to experience that follow-through in action! Read more »

No more long, dragged out firings. No more dread-filled days wondering if HR is coming for you and, if so, when. If you’re a Barclays employee set to be canned, you’re getting canned A-SAP. Read more »

Earlier today, Barclays chief Anthony Jenkins sent out a memo to employees informing them that moving forward, there’d be a new way of doing things ’round the bank. Namely, that whereas during his predecessor’s tenure, manipulating interest rates and engaging in other forms of criminal activity was acceptable, such things would no longer fly. And not in a “this sort of thing is now frowned upon” way but in a “you actually can’t do this anymore/if that presents a problem for you than clean out your desk and leave” way.

Aware that change can be very difficult, that it often causes great anxiety, and that many resist it entirely, Jenkins used 1,479 words to get his message across, acknowledging that not all employees will be willing to sign on board re: acting “fairly, ethically and honestly,” rather than simply writing: “Hey, we have a new policy called ‘not doing illegal shit.’ It’s a little unorthodox and it may not be for everyone, so please take some time to think it over.” Read more »