Morning Coffee: Laid-off Credit Suisse banker recalled to aid bank in hour of need. Bank focuses on eliminating older employees in job cuts
Credit Suisse has tacitly acknowledged that clearing out experienced employees can be a bad idea. As we observed when the Archegos losses first surfaced at Credit Suisse and Nomura, both banks had made job cuts to the prime broking businesses where the losses were incurred. Six weeks later, and after dispatching the two men who took over the prime broking business following the earlier cuts, Credit Suisse is reportedly bringing back the global head of prime broking it let go of nearly three years ago.
Indrajit Bardhan, who is now in his late 50s, is returning to Credit Suisse on a contract basis. A veteran prime broker, Bardhan has the sort of profile which makes you wonder why Credit Suisse let him go in a 2018 'leadership shakeup' that also involved dispatching around 20 long-serving members of his team. - He spent nearly 14 years working in equities trading roles interfacing with hedge funds at Goldman Sachs before spending four years at Merrill Lynch and then nine years at Credit Suisse, where he was first head of Americas and global risk and then global head of prime services. Bardhan was always based in New York, which is where the Archegos errors took place.
Bardhan has spent the past three years working as an independent consultant on risk analysis for banks and hedge funds. His return to Credit Suisse is undoubtedly infused with a strong sense of schadenfreude. Neither the bank nor Bardhan are commenting on his rehabilitation, which comes as Credit Suisse is restructuring its prime broking business and as incoming chairman António Horta-Osório is contemplating a major shake-up that could even involve closing entire divisions of the investment bank altogether.
Separately, while Credit Suisse has learned the hard way that getting rid of veteran staff can be a false economy, another European bank with a bloated cost income ratio has decided to throw some of its heaviest ballast overboard.
German bank Commerzbank is spending €1.8bn ($2.2bn) on restructuring. Chief executive Manfred Knopf last week struck a deal with employees over a 10,000 person job reduction program that reportedly includes reduced hours and early retirement for older employees. While the program might be expected to elicit cries of ageism, it appears to be popular with Commerzbank's predominantly retail banking employees, for whom a gentle nudge into premature retirement is preferable to forced lay-offs.
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