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* Lockdowns put client relationships under strain
* Junior bankers frozen out of client meetings
* Stress and heavy workloads lead to domestic strife
* Banks launch anti-burnout initiatives to ease stress
By Sinead Cruise and Pamela Barbaglia
LONDON, June 25 (Reuters) - Lockdowns are sharpening the
knives in the cut-throat world of M&A banking.
Stuck at home, armed only with a phone and a laptop, senior
advisors are finding out just how strong their relationships
with clients really are while frustrated juniors are left to
crunch numbers in the shadows, deprived of the personal access
to the rainmakers who could give their careers a boost.
With the dreaded "doughnut" – or zero bonus – almost a given
this year, and some banks looking to cut jobs to weather the
health crisis, the strains on bankers watching multi-billion
dollar pre-pandemic deals go up in smoke is taking its toll.
"It's like a Darwinian selection," said a senior advisor at
a Wall Street bank. "If you're a senior banker and you don't win
a single pitch you can only blame yourself. You've failed to
cultivate your relationships and now it's clear to everyone."
"If you don't know them well enough, you will never win a
mandate over Zoom," said the banker, who declined to be named.
A lack of face-to-face contact is not just exposing the
shortcomings of some senior financiers, it is also making it
harder for junior associates to learn on the job and progress,
headhunters, lawyers and bankers said.
"Junior bankers are challenged by old problems – long hours,
excessive workload and lack of acknowledgement – but this
lockdown has made them more acute," said Anna Marietta,
co-founder and managing partner of headhunter Vici Advisory.
"Juniors – especially analysts and interns – can also learn
through osmosis and they need physical interaction in the
office. They need to see how their managers are handling client
relationships and solving problems," she said.
RELATIONSHIP CHALLENGE
Global M&A volumes are down 41% so far this year, a far cry
from the champagne-popping records of recent years when bankers
at Goldman Sachs, JPMorgan, Morgan Stanley
, Citi and Bank of America - the top five
dealmakers - were the toast of Wall Street.
Massive government support for companies, particularly in
Europe, is keeping many firms afloat and delaying the kind of
lucrative takeover deals that have put M&A advisors at the top
of the investment banking world, bankers and lawyers said.
But the pressure to drum up business means the workload -
which often involves all-nighters and 100-hour weeks - is as
heavy and stressful as ever, ramping up the risks for employers
who turn a blind eye to potential burnout.
"Employers have always been responsible legally and
financially for harm caused when they didn't ensure an
employee's mental or physical safety at work," said Melanie
Stancliffe, employment partner at Cripps Pemberton Greenish.
"Ensuring the physical safety of employees is the prime
business reason to work from home and in this new normal, the
focus needs to shift to protecting employees from other risks so
they are well and can support - not sue - their employer."
For some bankers, the job stress is compounded by working
from home in proximity to their families and juggling chores
with conference calls, a shock to the system for people used to
jetting around the world to schmooze clients.
"The lockdown for many throws into sharp relief the health
of their home lives," Paul McLaren, consultant psychiatrist at
The Priory's Wellbeing Centre in the City of London.
"For many high achieving City workers that is an area of
their lives which they may have neglected, and participated in
only from a distance. Rebalancing the power relationships at
home with partners is a particular challenge at the moment."
LOCKDOWN STRAINS
Still, investment bankers, with their bumpers salaries and
bonuses from years past, can afford more palatial setups than
most employees working from home during the health crisis.
Some senior bankers in Britain have escaped to their remote
country piles while others have hunkered down in spacious pads
with attic studies in upmarket London neighbourhoods.
For some, the opportunity to spend more time with their
family is a rare gift they relish.
For others, the pandemic is exposing fractures in their
personal lives. Well-known lawyers and psychiatrists contacted
by Reuters have reported a surge in requests for help with
relationships and mental health.
"Suddenly, a high-powered financial professional is stuck
all day at home with someone that they usually barely see from
week to week and with whom they've learned to co-exist at a
distance," said Ayesha Vardag, known in City circles for winning
multi-million dollar divorce settlements for her clients.
Vardag told Reuters that inquiries from financial sector
employees and their spouses jumped 170% in the week to May 27 as
British lockdown restrictions began to ease, with some choosing
to call time on their marriages before bonus cuts and layoffs
damaged prospective settlements.
"Many financial sector clients and their spouses are
reactivating divorce enquiries they made before lockdown, left
in abeyance because they wanted to work on their marriages," she
said. "Then they found they couldn't stand it any longer."
'THE OLD-FASHIONED WAY'
For junior bankers, who typically range in age from the
early 20s to early 30s, the lack of career progress under
lockdowns is the main source of stress coupled with an ongoing
hiring freeze at most banks.
Shut out of video calls with clients due to digital security
concerns, five analysts and associates said their opportunities
to learn from - and impress - their bosses were limited.
Instead of knocking on a partner's door to discuss ideas,
some juniors said they had to lobby line managers to set up a
call with their bank's top rainmakers.
The top two M&A banks, Goldman Sachs and JPMorgan, said they
were pulling out the stops to keep junior colleagues engaged.
They pointed to a range of initiatives such as cocktail
parties hosted by senior executives on Zoom, wellness
programmes, online yoga and virtual choirs to relieve stress.
Banking bosses, meanwhile, are counselling their troops to
sit tight and wait, as the deal drought will eventually end.
"From the middle of March until the end of May, nobody felt
it was the right time to buy a business. But things have started
to change," said JPMorgan's co-head of global M&A Dirk
Albersmeier.
"Europe is coming out of this crisis faster than the United
States. In certain European markets bankers are already sitting
in the same room with their clients which may accelerate the
recovery. Getting to an agreement is often easier the
old-fashioned way."
(Editing by Rachel Armstrong, Carmel Crimmins and David Clarke)
