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Morning Coffee: Citigroup's surprise layoff suggests the perils of being promoted. Goldman Sachs' London office struggling with departure of favourite person

When Citi explained who it would be lopping-off in its 20,000 job cuts earlier this year, it seemed that one species of person would be spared: front office revenue earners. Of the 20,000 proposed cuts, Citi said 5,000 were to be managers, 5,000 were to come from selling businesses and 10,000 were to entail the removal of heads in technology and support functions. None were to entail people bringing in revenues.  

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The extraction of Conor Davis, one of Citi's most senior salespeople, therefore looks like a surprise. All the more so, because it was only a few years ago that Citi CEO Jane Fraser promoted Davis into the bank's most senior sales role in Europe. 

As Citi strips out layers of management, it seems that Davis has fallen foul of the curse of promotion. He became so senior that his job turned into pure management instead of revenue generation. Given that he will also have been very expensive, eliminating him became a clear way of cutting costs. Bloomberg reports that in his most recent job as 'global head of sales and solutions for financial institutions', Davis was overseeing 1,600 people across 42 countries, a role that implies exhaustive travel, limited time for visiting clients, and being deep in the weeds of internal dramas.

Davis' elimination is a reminder that when a bank comes up with a shiny new management structure, it's not always good to fly too close to the sun. Early in Jane Fraser's rein, Carey Lathrop and Andy Morton, Citi's then global co-head of markets and securities services, concocted a new structure which they declared was "transforming the way the team works." Davis, who had been with the bank for 14 years in various senior fixed income sales roles, was positioned at the top of that new 'rationalized' set-up. Three years later, Lathrop is at Apollo, Morton is trying to get a grip of the markets business and Davis has turned out to be superfluous. Beware the senior roles.

Separately, Goldman Sachs' London office is lamenting the departure of its favourite person. 

The Financial Times has been talking to senior people at Goldman Sachs in London, who say that things aren't the same since Jim Esposito resigned. 

Espo was the glue in the London office, says one insider. “Everything begins with Jim’s departure. Jim kept it all tied together,” they say. Without Jim, simmering divisional tensions are allegedly bubbling. 

It doesn't help that the two co-heads excluded from Goldman Sachs' CEO David Solomon's new investment banking operating committee - Mark Sorrell (M&A) and Gonzalo Garcia (European investment banking) - are also based in London. Nor does it help that the person who is on the new committee - Anthony Gutman  - is described by the FT as a "divisive figure." Esposito is seemingly needed to soothe senior Goldman sensibilities, but is AWOL after declaring that he'd lost enthusiasm.

Goldman spokesman Tony Fratto told the FT that the issues are exaggerated, describing them as "breathless gossip." 


Warren Buffett reflects how hard it's become to invest: : “There remain only a handful of companies in this country capable of truly moving the needle at Berkshire, and they have been endlessly picked over by us and by others. Outside the US, there are essentially no candidates that are meaningful options for capital deployment at Berkshire. All in all, we have no possibility of eye-popping performance." (X)  

The Goldman Sachs analyst convicted for insider trading has been sentenced to 22 months in a Victorian prison in London. He said trading helped him cope as his mother died of cancer. (Financial Times) 

A husband and wife team were working within 20 feet of each other in a home office. She was a BP mergers and acquisitions manager and he listened to her conversations and made $1.7m in insider trading profits. (Financial Times) 

When the husband confessed to his BP M&A wife, she moved out and filed for divorce. (Guardian) 

Bill Winters said Standard Chartered's “crap” share price did not reflect its true value, as fourth-quarter profits surged almost tenfold. (Financial Times) 

Amanda Thirsk, Prince Andrew's former private secretary, is now working in  a senior business development role at and is critical in a Chinese retailer's bid for Curry's. (Sky) 

London law firm Norton Rose Fullbright increased its newly qualified salaries from  £105k to £120k. (RollonFriday) 

Gary Stevenson says trading floors don't contain enough people like him. “There are many, many young, hungry, ambitious boys kicking broken footballs around lampposts in the shadows of east London’s skyscrapers. Many of them are smart, many of them are committed, almost all of them would make all kinds of sacrifices to put on a tie and some cufflinks and go walk into those tall, shiny towers of money. But if you step onto those trading floors... you will not hear the proud accents of Millwall and Bow, of Stepney and Mile End and Shadwell and Poplar.” (Financial News) 

Assets at multimanager hedge funds went from $185 billion at the end of 2019 to $350 billion at the end of last year. (WSJ) 

Return to office mandates are linked to firms with male CEOs who have greater power in the company. (ArsTechnica) 

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AUTHORSarah Butcher Global Editor

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