16Rock Asset Management’s Post

Citi's potential muni exit has market prepared for change The Bond Buyer | Jessica Lerner & caitlin devitt Fresh signs of a retrenchment among Wall Street firms came Friday with news that Citi CEO Jane Fraser is considering closing the firm's muni trading and origination business, which some market sources saw as a trial balloon being floated by top executives to test reaction. .....  The firm’s effort to scale back its muni business have been happening over the last two years, starting with “senior, big title legacy talent,” said JAMES PRUSKOWSKI, chief investment officer at 16Rock Asset Management. Additionally, he said “the transition as a liquidity and banking provider has been taking its course and decreasing over the last several years,” he said. ….. Along with hiring freeze, more layoffs may be on the horizon, Pruskowski said. “It’s a combination of challenging backdrop, the broader economic environment seems to be slowing, there’s an imminent risk of a recession, and deal flow, given high inflation, has slowed down infrastructure build, and that means less supply,” he said. Higher rates have led to significant losses for the year, and “going into yearend as you budget tough decisions need to be made,” he said. While it’s been a tough year across fixed-income generally, the Wall Street muni retrenchment marks an opportunity for regional and middle-market firms to gain more of a foothold, market participants said. “The market runs pretty deep regionally and with a lot of talent, so there’s a lot of second and third-tier shops ready, willing and able to step up to the plate,” Pruskowski said. https://lnkd.in/epViKgRF. #muniland #layoffs #budget #skilledlabor #freeze #inflation #banking #underwriting #supply #trading #liquidity #talent #regional #municipalities #waves

Using the current market price of Goldman Sachs' stock, the EEA framework predicted investor outlook on its future performance. https://lnkd.in/g_zfQw8R #FinancialNews #EconomicTrends #InterestRates #StockMarket #Investing #Accounting #FinancialAnalysis

Spinning Out: Goldman Sachs is Reshaping its Focus. Goldman Sachs’ latest quarterly results, released on Tuesday, revealed #profits declined 33% YoY compounding a weak Q2 when the bank’s bottom line shrunk 58%.

That wasn’t the only development yesterday where the investment giant skipped a beat. CEO David Solomon has also decided to step back from his side hustle — by night, performing as a DJ under the moniker DJ D-Sol — due to “media attention” surrounding the hobby reportedly distracting him from his day job of leading one of Wall Street’s most vaunted firms.

In his 5-year tenure, the CEO has come under fire for a series of controversies: seeking to impose corporate discipline in Goldman’s loose partner structure; sparring over bonuses and company restructuring; overseeing the infamous 1MBD fund; and paying off sexual harassment settlements.

Now, with Goldman’s #earnings reaching a 3-year low on consumer #losses, the company is pulling back on its efforts to pivot toward “Main Street”. With the launch of Marcus products in 2016, the bank was looking to build a sturdier business — dealmaking is wildly #profitable, but much harder to predict than steady fee-generating businesses like managing deposits and wealth management.

But, as it turns out, building a “boring” business based on deposits, #loans, and credit cards was harder than anticipated — so, for now, Goldman will stick to what it knows best: the world of high #finance. [email protected] 818-914-9271 #tradecreditinsurance

UBS Investment Bankers Brace for Next Round of Layoffs: According to a media report, investment bankers at the «new» UBS must prepare for further layoffs. But they are also having to deal with a paradox: the Swiss megabank has ambitious growth plans for its business. #Investmentbank #layoffs

Breakup Fees: An Interesting But Unlikely Approach The case of Jefferies seeking a $4M breakup fee has sparked discussions around damages clauses in recruitment offers. While intriguing, this practice is unlikely to become a standard across most industries. A few key considerations: Assess reasonable necessity, like non-competes or liquidated damages Overly restrictive covenants risk being unenforceable Best investment? Exceptional workplace culture and hiring practices Rather than punitive measures, the wiser path is often: Prioritizing ethical, transparent hiring Fostering a positive candidate experience Building strong relationships and rapport This organically attracts and retains top talent, reducing perceived needs for breakup fees and helping prevent candidate ghosting. While breakup fees may have niche applications in specific high-stakes scenarios, most firms are better served focusing on: Clear communication of expectations throughout the process Streamlining hiring timelines to maintain momentum Providing a great impression as an employer of choice What strategies have you found effective in mitigating last-minute candidate backup or ghosting? Let's discuss building a compelling employer brand! #TalentAcquisition #EmployerBranding

Citi’s Q1 earnings are beginning to recover after it took on major losses in the previous quarter as part of a massive restructuring spearheaded by CEO Jane Fraser. It’s #wealth unit income of $150M was down 6% from a year earlier. Citi’s CFO Mark Mason told reporters the wealth group is going to be laser-focused on existing clients. Here’s more on that and the larger corporate overhaul that includes a 20K headcount reduction and exiting 14 countries through 2026. #Citi #Earnings #wealthmanagement #JaneFraser #layoffs

Wall Street isn't just about the big names. While Goldman Sachs and its peers hold undeniable prestige, talented bankers can find rewarding careers (and potentially higher pay!) at elite boutique investment banks. What are Boutique Banks? ✅Specialised Focus: Unlike full-service giants, boutiques concentrate on a specific service (M&A, capital raising), industry (tech, healthcare), or region. ✅Smaller Scale: These firms are leaner than bulge bracket banks, typically handling deals under $1 billion. Examples of Boutique Specialisation: ✅Service: Mergers & Acquisitions, Capital Raising, Debt Restructuring ✅Industry: Technology, Media & Entertainment, Healthcare, Industrials ✅Geography: US (West Coast, Midwest, East Coast), Europe, South America The Rise of the Elite Boutique: ✅Big Deals, Big Pay: Don't underestimate the power of these players. Elite boutique banks handle large transactions (over $1 billion) and offer competitive compensation packages. ✅Prestige and Focus: These firms provide a unique blend of prestige associated with top-tier deals and the focused environment often missing in larger institutions. Considering a career in Investment Banking? Explore both bulge bracket and elite boutique options to find the best fit for your skills and goals. #InvestmentBanking #Careers #FinancialServices P.S. Share your thoughts on boutique vs. bulge bracket banking in the comments!

I turned down Goldman Sachs for Lehman Brothers, and fifteen years on still have no regrets. And, fifteen years on from the bankruptcy, I still have no regrets turning down Goldman to join Lehman’s Global Real Estate Group. Goldman are leaders and winners in Global Investment Banking, but that doesn’t take away from what Lehman was or is. As soon as I received the call from Lehman with the offer, I called Goldman and let them know that I would not be joining them (even their travel team was shocked). Lehman had a reputation that reflected who I was: an underdog, scrappy, hardworking, hustler, and less-aristocracy and more blue collar (less arrogant). Above all, they were known as the ‘nice guys on Wall Street’. Lehman was the undisputed Bond King of Wall Street, and, if you wanted to be in real estate it was all about the debt capital markets. The real estate group ran Lehman. I’d still argue that it was Lehman’s stretch into the equity markets that brought the bank down. And, as Barry Sternlicht frequently recommends, you should go where the action is. In the 2000’s, one can argue there was no better place than Lehman’s real estate group. My small team alone closed billions a year of debt and equity transactions, including the MetLife/PanAm tower in NYC, Archstone Residential, John Hancock in Boston, Coeur Defense Towers in Paris, and Devonshire House in London, among many others. If JMB was the place to be in real estate in the 80’s, Lehman was the place to be in the 2000’s. If I wanted a corporate banking or government career, Goldman clearly would have been a better choice. That’s not me though. I sought out an entrepreneurial career in real estate. And, a decade and a half later I run a rapidly growing real estate private credit business. We’re still underdogs, we’re still hustlers, and we are still the nice guys on the Street. I wouldn’t have it any other way. #PrivateCredit #LehmanBrothers #AlternativeInvestments Robert Catherine Michael Laura Eric David

UBS exit highlights Wall Street distress amid deal slump The Bond Buyer | caitlin devitt The dramatic move last month by UBS Financial Services to lay off nearly its entire public finance team and exit the negotiated underwriting business is an extreme example of the cuts seen at big firms since January as the municipal market slogs through its second year of anemic issuance. But the Wall Street layoffs offer an opportunity for regional firms to pick up veteran talent, market sources said.   The recent string of turnover across firms can be categorized as the "Great Reset," said JAMES PRUSKOWSKI, chief investment officer at 16Rock Asset Management. "It's being defined by large layoffs, compensation compression, consolidation, and involuntary or voluntary retirements," he said. "The banking business, alongside lower new-issue supply, is behaving more as an expense than a revenue center, and profitability from trading is down across the board on all Wall Street." … Citi also recently launched a major restructuring that will give CEO Jane Fraser increased authority over Citi’s five main business units, while also cutting management layers. JAMES PRUSKOWSKI noted that Citi has lost a lot of skilled labor in recent months and “as a liquidity provider, they’ve fallen down the ranks.” But, he added, the firm is “still doing a great job staying active.” #municipalbond #dealflow #layoffs #retirement #greatreset #compensation #consolidation #newnormal #opportunity #wallstreet Jessica Lerner #publicfinance #skilledlabor https://lnkd.in/etH3QQPz

Thanks to Vishesh Raisinghani for considering my point of view on human resources in private equity in this article in Mergers and Acquisitions - themiddlemarket.com and Acquisitions. While financial analysis is a core part of any PE firm’s competence, competitive advantage is built through people and firm culture. That’s certainly true at Clearview Capital, L.P. Capital, where my colleagues are our secret sauce. #privateequity #lowermiddlemarket