Morning Coffee: Analyst sues Centerview for insufficient sleep. Man who managed thousands of coders leaves Citigroup
If you're a 21-year-old Dartmouth graduate with mood and anxiety disorders that are worsened when you sleep for less than eight to nine hours each night, then investment banking is a curious choice of career. The industry has a well-deserved reputation for sleep deprivation due to long hours. However, Kate Shiber, a young Dartmouth graduate with mental health conditions exacerbated by insufficient sleep, thought perhaps her employer might make an exception.
Shiber joined boutique firm Centerview Partners as an analyst in July 2020. By August, the Financial Times reports that she was writing emails suggesting that the team might try to be efficient earlier in the day. It wasn't that she was unwilling to work: it was just that she was unwilling to work nights. The FT reports that Shiber told Centerview she'd work 105-hour weeks and 15-hour days, just so long as she got eight to nine hours sleep each night.
Initially, Centerview tried to accommodate her needs. Three months later, however, it gave up. Centerview fired Shiber, saying she couldn't meet the basic requirements of a demanding job. Shiber, who now works no later than 8pm in strategy for Google, is suing the boutique firm for $5m.
It's a case that gets to the heart of the working hours issue in banking. In London, there was once something called the "Magic Roundabout," whereby interns who'd been up all night working would return to their accommodation simply to shower and change their clothes while a taxi waited outside to return them to the office. That's less common, but grinding hours still remain.
Centerview, and Shiber's ex-colleagues are arguing that they're inherent to the job. Shiber was staffed on a live deal, and colleagues said her overnight absences meant she risked getting confused as others "keep building things out without her.” Shiber wants to know why she couldn't be staffed on a deal that only happened during the day.
Peers seem unsympathetic. Writing on Wall Street Oasis, most say Shiber should have known what she was getting herself into. When Instagram celebrity Mark Moran worked as an associate at Centerview, he told us 100 hour weeks were the norm. They were worth it for the "learning experience" said Moran yesterday, adding that while he worked for Centerview he almost never slept nine hours a night.
Pay is inverse with sleep. As a first year analyst at Centerview, Shiber could have expected to earn $205k a year.
Separately, Citi is reportedly starting its layoffs today, but Stuart Riley has left before they started.
Riley, who spent 14 yeas at the bank, was co-chief information officer and responsible for thousands of developers. When Citi announced plans to hire 2,500 developers for its investment bank in January 2020, it was Riley who led the build. Unconfirmed rumours suggest he's joining HSBC. He seems to have been popular internally, and insiders are questioning why he quit now.
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Meanwhile...
The shock at bonus time. “Everyone thinks they are a top performer. Many aren’t self-aware.” (NY Post)
European banks will need to cut more costs in 2024 as the benefits from rising interest rates wane. Investment banking might be the first area where banks will likely start cutting costs if needed. (Bloomberg)
Peel Hunt is forecasting 'an explosion' in UK private equity dealmaking next year ahead of potential changes to the way capital gains are taxed. (Financial News)
Millennium, with $62 billion of assets, wanted access to all of Schonfeld’s capacity, asking that it sever ties with clients. Schonfeld couldn't sanction that and so called the deal off. Millennium thought the deal was going ahead and was caught by surprise. (Bloomberg)
Bankers' favourite private messaging service Signal spends $33M to keep the lights on and its “many millions” of users’ messages safe from unintended eyes (TechCrunch)
KPMG's UK partnership is now less than half the size of rival PwC’s after the number of equity partners fell 7% and it failed to elevate any new partners in the partnership round. (Financial Times)
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