The Real Rainmakers

There was a time when the institutional side of a securities firm would walk with a swagger. After all, it was you, the retail financial advisor, who was stuck making presentations at a coffee table with mom-and-pops. Institutional brokers, meanwhile, were busy selling fancy derivatives to some extravagant, incredibly wealthy hedge fund manager. After a presentation, just imagine the institutional

There was a time when the institutional side of a securities firm would walk with a swagger. After all, it was you, the retail financial advisor, who was stuck making presentations at a coffee table with mom-and-pops. Institutional brokers, meanwhile, were busy selling fancy derivatives to some extravagant, incredibly wealthy hedge fund manager. After a presentation, just imagine the institutional salesman retiring for drinks and steaks at Frank Joseph's steakhouse downtown. You? You probably climbed back into your SUV and drove home for a meal with your family.

Turns out, you might have the better life. As you know, investment bankers, securities analysts, derivative salesmen — employees from nearly every business unit — are getting fired. In total, about 50,000 securities industry employees in the United States lost their jobs this year. But not retail financial advisors; the wealth management units, by comparison, are doing very well.

A blog called HereIsTheCity.com, a five-year-old financial news website based in London, has created a new league table: The Credit Crunch In Context. “We thought it would be interesting to work out just how much in write-downs and credit losses firms have written off per wholesale banking employee,” the site says. (By wholesale employee, the site means non-retail brokerage, or private client wealth management staff.) The site's findings are amazing. Here is an excerpt:

Firm Write-downs/Credit Loss Wholesale Bankers Loss Per Banker
Wachovia $7 billion 3,900 $1.8 million
UBS 37 billion 22,000 1.7 million
Citigroup 40.9 billion 30,000 1.4 million
BoA 14.8 billion 20,000 740,000
Merrill Lynch 31.7 billion 48,100 659,044
JPM Chase 9.8 billion 25,000 392,000
M. Stanley 12.6 billion 38,050 331,143
Goldman Sachs 4.1 billion 30,000 133,667

By contrast, turn to our compensation survey, and note that wirehouse advisors, on average, grossed about $500,000 last year. (Some other surveys say the average wirehouse production is even higher — closer to $800,000.) That may have seemed small potatoes once, but it sure glows by comparison now.

We thank you for your support. Drop us a line with your comments: 249 W. 17th St., New York, N.Y. 10011-5300. Or email us: [email protected]. Publisher Rich Santos can be reached at [email protected].

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish