Insider Finance - Business - Wall Street: Not a great quarter, guys

The latest in finance.
View in browser
INSIDER
Subscribe

10 THINGS ON WALL STREET

Hello! I'm Jeffrey Cane, filling in for Aaron Weinman, who is away for a week. First, a reminder that there will be no newsletter on Monday, as we observe the Fourth of July holiday. 

While you may see fireworks this weekend, on Wall Street, little has been popping. The second quarter ended on Thursday with a whimper: deal-making is on hiatus, markets are in a slump, and IPOs are all but nonexistent.

And as if they didn't have enough to worry about, some bank employees are concerned over their employers' attempts to monitor their messaging. More on that below. We will try to end on a more positive note, with our latest edition of Banker of the Week.

First, here's where finance stands at the half-way point of the year.


If this was forwarded to you, sign up here. Download Insider's app here.


Elon Musk looking at his phone.
1. Dealmaking is down. M&A broke records last year, but the current trend is not Wall Street's friend. 

Merger activity worldwide tumbled 21% in the first half of 2022 — to $2.1 trillion — from a year ago, according to Refinitiv data. Mergers worth more than $1 billion fell 30% worldwide. That includes some of the biggest that still need to clear a few hurdles, like Broadcom's acquisition of VMware, which faces an antitrust review in Europe, and Elon Musk's proposed buyout of Twitter, which has, well, Elon Musk. (Elon, by the way, has not tweeted since June 21 – a positive sign for the deal?) 

The market for initial public offerings had the slowest second quarter since 2009, says Renaissance Capital: just 21 IPOs raising $2.1 billion. With the stock market off to its weakest first-half start since 1970, expect more deals and IPOs to be put on the shelf. It could be a long summer for bankers. 

The slowdown spells lower fee revenue for banks – and the prospect of hiring freezes and layoffs. "Right now, everybody's worried about a recession," Brennan Hawken, a UBS equity analyst who covers the big banks, told Insider. 

Still, there are bragging rights. Leading the 2022 league table for global M&A advising are the usual suspects: Goldman Sachs, JPMorgan, and Morgan Stanley. Allen & Co. is at No. 10, thanks to advising Activision Blizzard on its sale to Microsoft. Speaking of Allen, the firm's annual summer camp for media moguls and deal makers kicks off next week in Sun Valley, Idaho. (Think "Succession.") The thin mountain air there could breathe new life into the merger market yet.


If this was forwarded to you, sign up here. Download Insider's app here.


In other news:

A phone screen with multiple app icons

2. The Wall Street tracking app that's now in demand is Movius. Bankers and traders – and their clients – love using messaging platforms like WhatsApp, but regulators insist that the banks monitor all work-related communications. So more banks are asking employees to install the Movius tracking software on their personal phones – leading to outcries over privacy. Insider spoke to the CEO of Movius, who explained how it works and whether employees should be concerned.

3. Big bank as Big Brother? A recently departed employee of JPMorgan Chase gave a first-person account of working under the bank's new tracking system. "I feel betrayed by a company I put my whole heart into," the former employee told Insider. "I won't buy into a system of fear."

4. Leon Black's lawsuit accusing a fellow co-founder of Apollo Global Management and others of conspiring to "destroy" and "cancel" him has been tossed out by a federal judge in Manhattan. The judge did not sanction Black's lawyers, as one of the defendants had requested. Black is also battling separately in New York state court over allegations of sexual assault made by his former lover. Insider recently profiled the #MeToo-supporting lawyer who is defending Black in that litigation. 

5. OppZo works to get loans to small firms that have won government contracts and need to ramp up fast. Insider has the 12-page pitch deck the fintech used to raise $260 million. 

6. UBS agreed to pay $250 million to settle SEC allegations that it failed to fully disclose the risk in a complex options trading strategy known as YES and did not adequately train its financial advisors who sold it. "YES had the potential to generate modest returns during periods of low market volatility; however, the strategy could — and eventually did — suffer losses during periods of high market volatility," the SEC order says

7. DE Shaw and four senior executives must pay $52.1 million to an ex-money manager who accused the hedge fund of defamation. Dan Michalow was terminated by DE Shaw in 2018 amid sexual misconduct allegations. But a filing Thursday shows an arbitration panel ruled that DE Shaw and its executives defamed Michalow. The award is believed to be the largest in a defamation case overseen by FINRA

8. Buy-now, pay-later startups have hit a rocky patch, but Zilch of the UK has just snagged $50 million in fresh funding. The company's CEO tells Insider why its direct-to-consumer business model sets it apart from its BNPL rivals.

9. If you are headed to the Hamptons this weekend, pray that you will not be stuck in traffic when nature is calling. Going forward this summer, you have two options: You can join the uber-rich in taking a helicopter to the Long Island enclave or you can have a medical procedure that reduces the urge to urinate. "Race to the Hamptons, not to the bathroom," is the pitch of the New York doctor who offers the procedure.


KKR's Pete Stavros

10. And let's not forget our Friday "Banker of the Week."

Meet Pete Stavros, the co-head of US private equity for KKR. He just closed on a deal to sell C.H.I. Overhead Doors to steel-maker Nucor for $3 billion. KKR will make 10 times the money it put into the door manufacturer in 2015. 

While such returns are to be expected for the biggest and best in private equity, what's surprising here is that there is also a significant payout to the truck drivers and factory staff who effectively held equity in C.H.I. Overhead Doors.

Here's how KKR and Stavros came to offer an equity-linked initiative to the workers.

If you know of any bankers we should feature in our Banker of the Week series, please let Aaron know at aweinman@insider.com.


Done deals:

  • Spanish soccer powerhouse FC Barcelona has reached a deal to sell 10% of its league television rights for the next 25 years to US investment firm Sixth Street for 207.5 million euros.
  • WPP has agreed to acquire the business of Bower House, an Australian marketing tech services firm with some 80 employees.
  • Universal Music Group is acquiring the estate of the musician Frank Zappa.

Curated by Jeffrey Cane in New York. Tips? Email jcane@insider.com or tweet @jeffrey cane. Edited by Hallam Bullock (tweet @hallam_bullock) in London. 

ADVERTISEMENT
  1. Savings just got interesting. 0 monthly account fees. 0 minimum balance requirements. 1.61% Annual Percentage Yield. Deposit any amount to start earning with Bask Bank. Member FDIC.
Download on the app store   Get it on google play

Older messages

Fed Chair Powell warned that sky-high inflation could turn permanent. It's the opposite of what he said a year ago.

Thursday, June 30, 2022

Thinking supply chains would quickly heal was something the Fed got wrong, Powell said Wednesday. Now there's a "clock running" to cool inflation. View in browser Business Insider

Wall Street: The wealthy crave private bankers

Thursday, June 30, 2022

The latest in finance. View in browser INSIDER INSIDER Subscribe 10 THINGS ON WALL STREET Hi, Aaron Weinman here. I've never needed a private banker, but the über rich are demanding their services

I was overly aggressive when I interviewed with WeWork's Adam Newmann for the Meetup CEO role — and it paid off. Here's why I recommend all leaders negotiate every detail.

Wednesday, June 29, 2022

"Many leaders fail before they walk in their door," writes David Siegel, because they don't ask for specific needs to set themselves up to succeed. View in browser Business Insider

Wall Street: Paving the way for Citadel’s Miami move

Wednesday, June 29, 2022

The latest in finance. View in browser INSIDER INSIDER Subscribe 10 THINGS ON WALL STREET Hi, Aaron Weinman here. Miami's a hot destination, both literally and figuratively, for Wall Street firms.

Why so many lawyers hate their jobs

Tuesday, June 28, 2022

When Tracy H. graduated from an elite liberal-arts college Read on Insider.com INSIDER INSIDER Subscribe INSIDER FEATURED ARTICLE LAW 'Widespread misery': Why so many lawyers hate their jobs —

The cost of a Taiwan war

Tuesday, August 9, 2022

Bloomberg Evening Briefing View in browser Bloomberg As China holds extensive and increasingly aggressive military exercises off of Taiwan, a group of American defense experts in Washington are focused

⚔️ Tesla vs. BYD

Tuesday, August 9, 2022

Clash of the EV titans | Nvidia 'fesses up | TOGETHER WITH Hi Reader, here's what you need to know for August 10th in 3:03 minutes. 🤔 You probably have two big questions right now: how high

🎯 Opinionated: 3 Pieces of Career Advice

Tuesday, August 9, 2022

… that you won't hear anywhere else. Plus, your top retirement questions answered. ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

Is Your Emergency Fund OK Given Inflation?

Tuesday, August 9, 2022

Also: 3 Best Money Moves for August 2022 ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌

I travel by Amtrak every few months, and I'm more productive on the train than in any coworking space. Here's how I optimize working on the move.

Tuesday, August 9, 2022

Writer Rossilynne Culgan shares why she thinks the best office in America for productiveness isn't an office at all — it's a seat on an Amtrak train. View in browser Business Insider Business

Wall Street: When PE chiefs call time

Tuesday, August 9, 2022

The latest in finance. View in browser INSIDER INSIDER Subscribe 10 THINGS ON WALL STREET Hi. I'm Aaron Weinman. Kewsong Lee, Carlyle's chief executive, will step down and leave the private-

The Daily StockTips Newsletter 08.09.2022

Tuesday, August 9, 2022

(Published 7:30 AM ET MON-FRI) ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

The Great Salary Convergence is driving up salaries

Tuesday, August 9, 2022

Paying people based on where they live never made a ton of sense... Read on Insider.com INSIDER INSIDER Subscribe INSIDER FEATURED ARTICLE ECONOMY Welcome to the Great Salary Convergence — a seismic

The Soundtrack To Planet Money Summer School

Tuesday, August 9, 2022

It's a summer of macro at Planet Money. Celebrate hot econ summer with our playlist. View this email online Planet Money Hot Econ Summer by Greg Morton School is not out for summer. Planet Money

[New post] Cryptoassets, the metaverse and systemic risk

Tuesday, August 9, 2022

BankUnderground posted: " Owen Lock and Teresa Cascino Cryptoassets could have important roles within the metaverse – a decentralised, immersive next generation of the internet. Cryptoassets