Long overdue, I finished reading Geraint Anderson’s ‘Cityboy’ today. It was recommended to me by Ken Ghata at Terrapinn over a Sydney lunch a couple of months ago when we were discussing the financial markets and the industry’s general behaviour in times of financial crisis. Thank’s Ken, it was well worth a read!
In short, the book is about a UK hippie turned investment banker (utilities analyst) who develops a typical investment banking attitude to life (in all the bad ways!). It is a very amusing story with examples that will sounds very familiar to anyone who has been working in the industry.
Beer and loathing in the square mile
I certainly wouldn’t claim to be of Anderson’s caliber when it comes to cocaine, strip clubs and excessive bonuses, but I thought I could still share some examples of terrible behaviour from people who take their lives just a touch too seriously.
1. Financial modelling training for UBS - after hours
A couple of years back I was asked to prepare a proposal for financial modelling training for UBS. There was a tweak to the was the team leader wanted the training delivered because ‘all investment bankers were too busy to attend training during the day’ so they wanted to schedule financial modelling training classes from 8pm - 10pm on weekdays plus extra sessions on the weekend. Nice. I was actually relieved to hear that the team decided not to go ahead with the proposal..
2. Conference calls at 3am with Merrill Lynch
A few years back my team was working on a financial model for an Australian chemicals project with Merrill Lynch in New York arranging the funding. I couldn’t believe the attitude from the New York bankers when they requested a 3am conference call to discuss the model. What made it worse was that there was no element of a question in their request - they just took it for granted that we would be fine with it. Sure, I don’t mind the odd late night call, but I prefer to be asked about it!
3. Babcock and Brown - no love for financial modelling
We built a project financing model for a utilities project and Babcocks were brought in as a JV partner for the financing component. In the first meeting, they showed off a typical behaviour that is very typical of investment bankers’ attitudes to financial modellers. Since traditionally (in banks) financial models are often constructed by the most junior person on the team then there is a build in attitude that you should be arrogant and demanding towards the financial modeller.
Working with Navigator Project Finance at the time, the model had been constructed by people with +10 years of modelling experience and who had made financial modelling a career, and such an attitude to some of the most experienced financial modellers in the industry is just bad. Subsequently Babcock and Brown pulled out of the transaction, which wasn’t surprising at all given that their share price went into free fall and now they are pretty much gone.
If you haven’t read Cityboy already - get a copy and read it!
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