Morning Coffee: Goldman Sachs MD says bankers must intrepidly meet clients despite war. Deloitte's two-tier benefit system strikes dud note

If you work in investment banking and were hoping that war in the Middle East and resulting high aviation fuel prices might be the catalyst for a return to remote meetings, you are probably not a very good banker. You are also wrong. War in the Middle East is the catalyst for meeting clients more than ever. Clients need reassurance. They also need face-to-face persuasion to do deals.

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With this in mind, Anthony Gutman one of Goldman Sachs' most senior bankers in London, has been in Dubai and Abu Dubai recently. Speaking to local publication the National, Gutman declared, "We're in the relationship business. These relationships are no different to any other relationships in your life. And when you have a friend in need, you come and see them.” 

Gutman's arrival comes as the British government is advising against all but essential travel to the United Arab Emirates and cautioning that travel insurance might be invalidated if this advice is ignored. Gutman presumably doesn't mind if he loses his suitcase. “Look, I went for lunch today. The restaurant was full. I went for a coffee at Starbucks. I had to queue up to get my coffee," he said. Even being stuck in "incredible traffic" was a positive. "It's clear that the perception of what's going on here versus the reality is different," enthused Gutman, who runs Goldman's the London office with Kunal Shah and was once a hotels and leisure banker by trade. 

Gutman was not in Dubai to sample the Frappucinos. He was there to feed the pipeline of deals. "Tailwinds" are still blowing, said Gutman. The pause will not last. The advisory backlog is close to record levels and Middle East deals will be strong this year, albeit a bit backdated. Now is the time to grease the wheels.

It's not just Gutman who feels the breeze. Goldman CEO David Solomon extolled the "robust" climate for M&A earlier this month, and claimed that geopolitical risks are being "trumped" by clients' urge to do "consolidating trades" and to merge themselves with appropriate others.  

Gutman said Goldman's other bankers are eager to get on the road too. The firm's teams are "consistently" choosing to return, Gutman said. Being on the ground is a necessity. Dispensing platitudes behind a screen will not get deals done.

Separately, as AI threatens to take over jobs that don't involve drinking Starbucks with concerned clients, Deloitte seems to have decided to bifurcate its workforce and to offer poorer benefits to humans occupying the sorts of roles at risk of automation.

Business Insider reports that the Big Four firm has begun reducing parental leave for people in support roles like administrative services, information technology, and finance and that it may also cut back paid time off, pensions and IVF funding for people in these groups. AI does not need any of these things.

Meanwhile...

Morgan Stanley paid its top London bankers £1.2m last year. (Financial News) 

Sebastian Barrack, head of global commodities at Citadel, says he has a screen purely to monitor Trump's tweets. “You need to understand that the market is moving [based on] this information,” even though, “it may not be fully thought through”. (Financial Times) 

Alexander DiLeonardo, chief people officer at Citadel Securities, says technical skills are being commoditized to an extent. "Creativity, leadership potential, raw problem-solving ability, commerciality," are all the rage instead.  (Business Insider) 

Pity the private credit salespeople. They are working harder than ever, for less pay. "You're stuck saying, 'Buy more please.'" (Business Insider) 

Stefan Ericsson at Taula Capital has gone to Jersey. Last year, Taula hired Lewis Morton from Eisler who is based in Jersey too. (Financial News) 

Andrea Orcel's hostile takeover of Commerzbank became more hostile after he declared Commerz “a story of operating underperformance” yesterday. (Bloomberg) 

Former UK politician Chuka Umunna is leading JPMorgan's expanded initiative to invest in industries critical to national defence in the UK and Europe as well as in the US. The bank plans to hire in the UK and Europe to support the initiative. (Financial Times) 

Kevin Warsh comes to the Fed at a particularly difficult time. Trump wants rates to be cut “substantially” and “immediately", but war makes this unlikely. (FT) 

Senate Democrats will question Warsh today after he disclosed that he owns $100m in assets last week but said the underlying details were confidential. (WSJ) 

Nik Storonksy at Revolut says it will be two years before an IPO. (Bloomberg) 

The unhealthy habit of checking your phone, reading the news, and responding to emails and messages almost instantly endures far beyond the end of a banking career. (FT) 

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