Citi vice chair running for NYC mayor; Morgan Stanley joins list of unscathed
Receiving Wide Coverage ...
Weathering the storm
Morgan Stanley “said its quarterly profit rose 25% from a year ago, another big U.S. bank to skate unscathed through the rockiest economy in years, ” the Wall Street Journal reported. The bank earned $2.72 billion, or $1.66 a share, while revenue rose 16% to $11.66 billion.
“The nation’s big banks have weathered the pandemic better than many of the clients they serve. Each posted billions of dollars in profits—and three including Morgan Stanley saw their profits grow from a year ago—despite a deep recession and an economic outlook tied to the odds of a compromise in Washington.”
“Trading was the standout performer for the third quarter and helped drive Morgan Stanley to its second-highest quarterly revenue in history, mirroring results from rival Goldman Sachs, which almost doubled its third-quarter earnings,” the Financial Times said.
Separately, Morgan Stanley “is piloting a program to recruit Black talent in its sales and trading division, corporate America’s latest initiative to improve diversity,” Reuters reported. “The Morgan Stanley Experienced Professional Program is seeking Black professionals with at least two years’ full-time work experience in any field who want to work in finance.”
“As long as you have the skill set around communication, analytical abilities, interpersonal skills, and you are willing to work hard, you could have a strong career,” Derek Melvin, a managing director who designed the program, said. The program “is only open for up to 20 people. Melvin said he hopes the program, if successful, will be replicated across the firm’s institutional securities business.”
Hat in the ring
Ray McGuire, “a longtime Citigroup executive and one of Wall Street’s most prominent Black bankers, will leave the bank to join a crowded field vying to become New York City’s next mayor. Mr. McGuire, a Citi vice-chair, holds out the rare promise of being able to appeal to minority voters as well as an anxious business community that has come to loathe the current mayor, Bill de Blasio, whose second term ends next year.”
“Mr. McGuire has spent more than 15 years at Citigroup — 13 as head of corporate and investment banking, making him one of the most visible Black bankers pitching Wall Street’s wares to corporations and institutions. In an internal memo announcing his departure, Mike Corbat, Citi chief executive, and Paco Ybarra, investment banking boss, called Mr. McGuire a ‘powerful and path-breaking voice for the industry on diversity and inclusion.’”
Stripe, “the online payments provider that is one of Silicon Valley’s most valuable private companies, is expanding into Africa for the first time with the acquisition of Lagos-based payments company Paystack. Paystack has been at the vanguard of a group of companies that have made Lagos the hottest fintech ecosystem in Africa, as investors seek to tap into a severely underserved market of 200 million Nigerians, tens of millions of whom lack bank accounts.”
“Nigerian fintech companies including Flutterwave, OPay, Interswitch and PalmPay, have together raised hundreds of millions of dollars in funding over the past 12 months, despite lingering concerns about the regulatory risks of operating in the market.”
On second thought
A former Deutsche Bank risk manager who refused to accept an $8.25 million whistleblower award from the Securities and Exchange Commission for helping to uncover false accounting at the bank says he is going broke. “I would need a near miracle to avoid bankruptcy at this point,” Eric Ben-Artzi said.
The SEC granted him the award in 2016, “a year after it fined Deutsche Bank $55 million for artificially boosting its balance sheet. But Mr. Ben-Artzi rejected it, writing in the Financial Times that he could not take money that had been extracted from ‘Deutsche’s shareholders instead of the managers responsible,’ He suggested a revolving door culture of top lawyers shuffling between the SEC and Deutsche Bank had made the watchdog go easy on management.”
The “legacy of slavery endures” in credit scores, a Post columnist charges, “and Blacks must make extraordinary efforts to overcome the discrimination that is often hidden in policies or, in the case of credit scoring, products that purport to be race-neutral. The credit score is supposed to eliminate bias. … But factors that are included or excluded in the algorithms used to create a credit score can have the same effect as lending decisions made by prejudiced White loan officers.”