The Germans are “going on a diet” that will involve a “painstaking, methodical, meticulous approach to boosting efficiency” and “very significant streamlining” in the investment bank and no one, not even the people hiding out in Chicago are safe. Read more »
Deutsche Bank
In addition to cuts in the Industrials; M&A; Real Estate, Gaming, Leisure & Lodging; and Leveraged Finance, the bank’s converts desk was said to be “gutted,” losing at least five Managing Directors and a few analysts. On the bright side, today was expected to be the last day of layoffs for the foreseeable future.
Cuts are said to have gone down in DB IBD. Read more »
The Germans are not yet done firing employees in Asia. Read more »
Those shares DB awarded you to make up for the ones you were leaving with your old employer? They’re going to need those back. Read more »
Authorities Would Like To Add That Deutsche Bank Executive “Ruthlessly Beaten” By LAPD May Or May Not Have Been On “White Lightning” At The Time
By Bess Levin
A couple weeks back, Deutsche Bank vice chairman and managing director Brian Mulligan filed a claim with the city of Los Angeles, letting people know he intended to sue for $50 million over an incident that took place involving the LAPD, which left the media banker with “a broken shoulder blade and 15 nasal fractures.” According to Mulligan, police officers abducted him from a street corner, drove him to a motel, told him to wait there for a few hours, and then beat him so “ruthlessly” he “barely looked human” when they were done. According the LAPD, several calls had been placed about a man in the area “trying to break into cars” that fit Mulligan’s description. They confronted the guy, who told them he was tired, which was why they drove him to the motel. He emerged hours later, started running through traffic, failed to heed their orders to get out of the street and assumed a “fighting stance,” hence the need to deal with him in an aggressive fashion. At the time, a spokesman for the LA County DA’s office said that there are no plans to file criminal charges and that the office would simply like to “have a discussion” with Mulligan to advise him on “how best to follow the law so that incidents like this don’t occur again.” Also, they’d like you to know, it’s possible he was experimenting with bath salts. Read more »
Deutsche Bank Managing Director, LAPD Not Yet Seeing Eye To Eye On Savage Beating “Incident”
By Bess Levin
Yesterday afternoon, Deutsche Bank vice chairman and managing director Brian Mulligan filed a claim with the city of Los Angeles, letting it be known that he plans on suing for $50 million, over an altercation with the LAPD that left Mulligan with “a broken shoulder blade and 15 nasal fractures.” According to the media banker, he was minding his own business one night in May, when a couple of officers approached him, asked him what he was doing in the vicinity of a marijuana dispensary, searched his car (where they found a few thousand dollars), drove him to a motel and told him to wait there. Several hours later, still waiting, Mulligan says he started to become suspicious and decided to leave, at which point the officers returned and “began ruthlessly beating him” so badly he “barely looked human” when they were done. If this had happened to you, you might be a little upset too! The LAPD, however, claims that Mulligan has no reason to be angry with them and, in fact, owes the officers an apology, for his “outburst of erratic behavior.” Read more »
The Germans thought about it and decided yes, layoffs sound like a great idea. Read more »
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Banks
Deutsche Bank Won’t Let A Little Libor Manipulation Or Earnings Miss Slow It Down
By Matt Levine
Deutsche Bank had two weird little bits of gun-jumping news today, one good(ish), one bad (just bad). The good news is that Deutsche Bank has decided that it wasn’t manipulating Libor too much:
A Deutsche Bank internal probe has found that two of its former traders may have been involved in colluding to manipulate global benchmark interest rates but there was no indication of failure at the top of the organization, three people close to the investigation said.
So … great? Those two Deutsche Bank traders can look forward to possible jail, but the buck stops with them: the board-appointed probe has exonerated the board. Ha ha ha you say, but why not? Jailable Libor manipulation by traders seems conceptually distinct from approved-by-the-Fed-and-BoE Libor manipulation for the perceived good of the financial system, and while the former is worse for the traders and submitters the latter might be worse for the top officers. At Barclays, at least, senior people were not intervening to pick up half a basis point here and there on swaps trades, but they were intervening to make themselves look pretty in the eyes of markets and Paul Tucker. And now they’re gone! At Deutsche, we don’t know what this report says, but there’s at least fake statistical evidence that DB didn’t systematically skew Libor one way or another, suggesting that the einzigen Badapfel* theory might be true, or true enough for the board not to fire itself, which is a lower bar.
The bad news is that DB announced today that it expects to announce crummy earnings next week, to the tune of EUR1.0bn/700mm of pre/after-tax net income in 2Q2012, down from 1.8/1.2bn in 2Q2011 and off ~30% from analyst estimates. This puzzled me not so much in earnings being down – what else is new, new normal, etc. – but in that we’re getting a sneak preview a week before earnings. Why do that? Read more »
The Germans are considering sending some bankers to live on a farm upstate, where there’s plenty of fresh air and room to run around. Read more »
It’s no surprise that more Liborneriness is coming to a bank near you; with Barclays and UBS already pretty much having admitted wide-ranging Libor manipulation and Deutsche Bank seeming to be next up for a roasting. Maybe some people will go to jail, and certainly some more banks will pay fines, but also certainly those fines will be very very very small compared to the potential lawsuits. Because there are eight hundred quazillion dollars of Libor-referencing contracts, and if you screwed them up then in some loose theoretical way you owe money to everyone who got screwed without having any offsetting claims against anyone who benefited.
Now the US legal system being what it is the lawsuits long preceded the evidence of manipulation and there’s a big mishegas of a Libor lawsuit that’s been going on for years in New York. This suit looks a little quaint now, being based on the theory that all the banks got together in a room, smoked cigars, rubbed their hands together, and agreed to lower Libor for some unspecified nefarious purpose. Now we know that they all worked against each other to lower and/or raise Libor for a variety of clearly specified nefarious purposes,* until the crisis hit and they all started working independently to lower Libor for clearly specified and maybe public-spirited purposes. And the banks will tell you that themselves, in their motion in the case filed last week:
Plaintiffs themselves cite as the primary motive for the alleged false reports a desire by Defendants to hide their supposed financial weakness from each other and the public, which would naturally call for circumspection by such banks, not discussion and agreement among them.
See? We would never work together to manipulate Libor – we’re too sneaky for that. We’d prefer to lie to each other, too. Read more »
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