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Opinion

Russian roulette and the Big Eddy Club

When the bear meets the eagle, can any good come of it? Lehman Brothers has capitulated and is returning to the Russian market. Earlier this month, news leaked that the firm was hiring Nicholas Jordan, co-head of Russian global banking at Deutsche.

Lehman Brothers flounced out of Russia in 1998 along with many other financial institutions when Götterdämmerung occurred and the Russians defaulted on their short-term rouble debt. Some banks have gingerly dipped their toes back into the swirling Russian swamp while others have held their noses and jumped in at the deep end. UBS and Deutsche have both bought local banks. But Lehman has been more reticent. I am reminded of a male divorcee who is reluctant to marry his siren girlfriend. It is rumoured that certain individuals at the top of the Brothers were unsympathetic to the argument that if you are not in Russia, you are not a red-blooded male. I presume that Jeremy Isaacs, Lehman’s CEO for Europe and Asia stamped his Lobb loafers and said: “We need to do this.” Jeremy is utterly delightful but I would never underestimate the steel that runs through his spine.

Nicholas Jordan, Lehman Brothers.
Former co-head of Russian global banking, Deutsche

Jonathan Moulds, President of Bank of America, EMEA

Norman Rosenthal, Exhibitions secretary of the Royal Academy

Lawton Fitt, Secretary of the Royal Academy and former partner of Goldman Sachs

Philippe Jabre, Jabre Capital Partners

Carlton Gary, Convicted stocking strangler

Hank Paulson, US Treasury Secretary and former Goldman Sachs chief executive


And it is a coup for Lehman to recruit Nick Jordan. Of course, gainsayers scoff that a king’s ransom will attract any one. An article in the March edition of Euromoney highlights the generous compensation packages that are being offered to Russian specialists. But I believe there always has to be a push as well as a pull in career decisions. Was there something at Deutsche that displeased Mr Jordan? “At Deutsche, he was a co-head, whereas at Lehman, he will have his own platform,” a source pointed out. Nick Jordan is the brother of Boris, who founded Renaissance Capital, a Russian investment bank and is chief executive of the Sputnik Group, a private equity firm.


Now that Lehman is re-entering Russia, the moment might have come for others to retreat – at least those who have already made their money and want to keep their sanity. Reports that the fees on a recent equity offering by Russian bank Sberbank were a mere 0.08% make me nervous. After all, they don’t call it Russian roulette for nothing. What do you think? Probably the last thing I felt like last Tuesday evening was sallying forth to the gaming tables. Indeed, crippled by acute back pain, the only place I wanted to go was an opium den where you can purchase oblivion by the ounce. However, I had been invited by dishy, dashing Jonathan Moulds, president of Bank of America, EMEA, to attend the opening dinner for the exhibition “The Unknown Monet” at the Royal Academy. Bank of America is sponsoring the exhibition.


I presume that Jeremy Isaacs, Lehman’s CEO for Europe and Asia stamped his Lobb loafers and said: "We need to do this"

Charming Cassie, Jonathan’s assistant, had offered to send a car to collect me. Jonathan has impeccable manners, which is so refreshing in this era of the “me, me, me” cult. “Don’t be silly Cassie,” I said. “The Royal Academy is just down the road, I’ll get a cab.” Back pain, London traffic and elusive cabs are a lethal concoction and I arrived half an hour late. As I walked in, I noticed a distinguished-looking gentleman scouring a list while cross-examining a female attendant. There was a pause in the conversation and I beckoned the attendant over. Since becoming a journalist, I am shameless. “I know that man,” I ruminated. “Who is he? I used to work with him.”


“Oh it’s Lord Aldington, chairman of Deutsche Bank in London,” she responded, eyeing me quizzically, and then: “You wouldn’t happen to be Abigail Hofman, would you? We’ve been looking everywhere for you.”


My guide dragged me upstairs, where Jonathan was hovering anxiously. His anxiety levels could not have been improved when I warned: “Jonathan, if I keel over, please take me to the local hospital.” Fortunately, after that, the evening improved immensely. The drawings and pastels were fascinating and the dinner was adorned with London’s great and good. Norman Rosenthal, the exhibitions secretary of the Royal Academy, sat at the next table. Norman, who has a touch of Hercule Poirot about him, is legendary not only for his contribution to London culture but also for his reputation as the art world’s enfant terrible (albeit a 60-year-old ET). In one interview, Rosenthal bemoaned: “Everyone thinks I’m this monster but I’m not.”


Someone who might disagree is Ms Lawton Fitt. Lawton, like Brady Dougan, the incoming Credit Suisse chief executive, has one of those waspy American names that are better off backwards. Think: Fitt Lawton. Lawton used to be a partner of Goldman Sachs but in 2002 decided to do a sideways shuffle from finance to culture. She was appointed the secretary (effectively the chief executive) of the Royal Academy. Rumours abound that La Lawton did not bond with Norm the Picture Prince. In due course, Ms Fitt resigned but Norman remains very much a portentous presence within the hallowed portals of the Royal Academy. “Lawton’s face didn’t fit,” a member of the art establishment told me. “In her defence, it’s always difficult to effect change when you are an outsider.” I always remember the Lawton Fitt saga when investment bankers warble about “portable skills”. One handsome financier looking back on the start of his meteoric career is rumoured to have said: “It was either Hollywood or Wall Street.”

One handsome investment banker looking back on the start of his meteoric career is rumoured to have said: "It was either Hollywood or Wall Street." There is one man I know to whom that phrase could indeed apply – hedge fund manager Philippe Jabre

There is one man I know to whom that phrase could indeed apply – hedge fund manager Philippe Jabre. I first met Philippe at renowned deal-maker Ian Hannam’s 50th birthday party. Hannam is chairman of equity capital markets at JPMorgan Chase. I liked Philippe immediately and I am delighted that he is doing so well with his new Geneva-based hedge fund, Jabre Capital Partners. Last week, it was announced that Mark Cecil, formerly head of marketing at GLG, will join Jabre Capital as a partner. The fund is expected to close soon at $2 billion. I congratulate Mr Jabre. Commiserations, however, to Carlton Gary, an African American who has been languishing on death row for over 20 years following his conviction in Columbus, Georgia, for the rape and murder of seven elderly white women. Regular readers will know that I am increasingly concerned about the gulf between the insulated world of the very rich and the real world. My Oxford classmate, award-winning reporter David Rose, has written a compelling book about these stocking stranglings, the significance of the exclusive Big Eddy Club and the racist fissures in the deep South that have led to a grave miscarriage of justice. Violation is published this week by HarperPress.

Commiserations also to Hank Paulson, US Treasury Secretary and former Goldman Sachs chief executive. There is a dreadful and completely gratuitous photograph of Paulson looking positively reptilian on Page 102 of this week’s Economist magazine. The article is about Warren Buffett – who is pictured looking cherubic and cheery.  Mr Paulson is not even mentioned. Has Mr Paulson done something to offend the editor of the Economist? I think we should be told. Note to Mr Paulson: Please practise smiling in a dignified manner before a mirror. I assume that like all successful investment bankers you are addicted to early morning runs but if you could spare a few minutes for regular smiling practice, we would all be inordinately grateful. It’s never good to frighten the horses.

Finally, what’s the hot gossip on the possible merger of Barclays and ABN Amro? As is the custom in these types of trades, each bank will retain part of its name. Barclays will keep Barclays, and ABN will keep Bank. The merged operation will be known as Barclays Bank.

Next week: A plus B: the end of the beginning or the beginning of the end? 

Please send news and views to Abigail@euromoney.com.

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