Morning Coffee: Goldman Sachs’ new banking head seems a bit unusual. A sudden decline in prospects for ECM bankers

Eyebrows might have been raised in the London investment banking community yesterday, at the news that Simon Lyons has been appointed as co-head of UK investment banking by Goldman Sachs. Lyons will jointly head up the division with Nimesh Khiroya and will join the firm as a partner.

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That’s not entirely surprising. It is unusual for GS to make lateral hires at partner level, but by no means unknown. Only 50% of Goldman Sachs' last partner class joined the firm as graduates.  Lyons has things to recommend him. He was previously the co-head of Europe at Ardea, and had been selected as one of the founding partners when Paul Taubman set up PJT Partners in 2015. Before that he was making it rain at UBS and he’s still bringing in the big deals, most recently the acquisition of Mitie Group by OCS. 

At no point until now, though, has Lyons worked for Goldman. Bringing in a head of the business from outside when you have plenty of bankers already will always ruffle feathers. And Goldman Sachs has been doing quite a lot of this recently, particularly in the EMEA region. The co-head of investment banking for France and Benelux is David Benichou, a lateral hire from Morgan Stanley and the co-head of European M&A is Carsten Woehrn, formerly of JPMorgan.

It’s not that Goldman was floundering or in any obvious need of new blood.  So far in 2026, it’s captured its highest market share in EMEA deals for a decade, and it’s ranked number one in UK M&A ever before Simon Lyons starts making a contribution. 

Why hire Lyons externally then? Maybe it's a declaration of intent. Maybe Goldman has identified EMEA as a region where the revenue potential is underestimated, and decided to invest enough to build a strong franchise into an utterly dominant one?

This is a strategy.  It’s just not very … not very Goldman Sachs.  Historically, the firm has preferred to build its talent pipeline internally, rather than to hire “galacticos” on the open market – it’s been more of a Barcelona than a Real Madrid, more of an Arsenal than a Manchester City, to use two suitably European analogies.  Top level investment banking is a market made up of personal franchises and trusted relationships, but that doesn’t mean it’s always a good idea to grow that way.

Investment banking is a team sport, and however much you emphasise social  skills and cultural fit in the selection process, you can never really tell how someone’s going to adapt to a new working environment until they are there.  Every lateral hire of this kind takes up a partnership slot which someone else might have been hoping for.  When you add that to the intrinsically destabilising effect of creating a co-head structure, the risks are considerable. Goldman has decided to take them.

Elsewhere, it does seem that there might be a few fluffy clouds on the previously bright horizon of the global equity capital markets industry.  Market attention has mainly been focused on the IPOs of Anthropic and OpenAI, which were meant to be fee-earners on the scale of SpaceX in the second half. Both now appear to have both been somewhat slow in making the filings to start the process.

It's not just the fear of AI apocalypse that's issuers.  Smaller deals in industries as varied as nuclear power and insurance services have also been postponed, simply because of “market conditions”.  Sellers (particularly private equity backers) have a price in mind, and they seem to be worrying if they will be able to achieve it.  Although the stock market itself is still doing fine, with the NASDAQ at all time highs, big investors appear worried about committing large amounts of new cash. 

All of which is likely to continue while the big AI deals are overhanging the market.  If OpenAI and Anthropic can sort out their “alignment” problems and move forward, then 2027 could still be a good year.  If not, then the party might be about to get a little less raucous.

Meanwhile …

Not so long ago, Jefferies was the upstart on Wall Street, aggressively hiring Managing Directors from bigger firms.  Now it’s getting a little of the same treatment, with Drew Weisman, Steve Tricarico, Russ Shoemaker and Hub Orr all going to Raymond James within a short space of time.  (Reuters)

Commuting costs money, and so does childcare.  The union representing Barclays workers is asking the company to recognise this, and either pay more, help out with vouchers or reduce the number of compulsory in-office days for employees with caring responsibilities or who are located a long way from their teams. (Fortune)

Bankers used to moan about being unpopular, but AI employees have to deal with the mental strain of coming to terms with the fact that they might be about to destroy humanity. The news that the IPOs are delayed isn’t cheering either, apparently. (FT)

“I have seen a shift in understanding on the fixed-income side about how to start pricing in climate from the physical standpoint, and that’s a big shift from five years ago to today”. Sarah Kapnick, global head of climate advisory at JPM, makes the case that it’s no longer so much a matter of ESG scores as “has the collateral been destroyed by a flood”. (Bloomberg)

It turns out that if you make an AI clone of your boss to interact with, your actual boss is likely to hate it.  And then the AI clone picks up on this hatred, and begins to hate itself. (WIRED)

Kids these days … more and mo

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