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| Date: |
20 Aug 2008
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| Name/Email: |
bohater ()
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| what rubbish, bo staff are 2nd 3rd tier people and should be paid accordingly, they are usually the people that were worst in class during academic life..... |
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| Date: |
20 Aug 2008
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Wizard of EC1 ()
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| They may be those that "were worst (sic) in class" but they weren't the numptys that lost £500 m. |
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| Date: |
20 Aug 2008
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opsrecruiterandproudofit ()
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| Bohater demonstrating exactly the kind of poor attitude that has left his industry in a very sorry state. If in fact he is a FO professional and not just another bitter, twisted job seeker.
I think Bohater is completely missing the point here and is obvioulsy an academic snob. Best place for academic snobs is probably academia, where they can happily co-exist with lots of other individuals who lack inter-personal skills, have massive egos and posses absolutely no common sense.
Bohater should rememeber academic achievement is not necesarily a measure of intelligence.
That point aside, I think the article here is referring to the old addage - pay peanuts / get monkeys. No point in having a football team made up of goal hangers. You need some talent at the back as well. Yes you should reward people who score goals but you also need to reward those that prevent you conceding own goals. Looks like the securities industry has been scoring massive own goals for the past two years and only realised once the final wistle had been blown.
As usual its a serious lack of intelligence in FO and a large amount of excessive greed that has allowed this to happen. |
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| Date: |
20 Aug 2008
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| Name/Email: |
ChasDarwin ()
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| Yo bohater. If your so smart build a time machine and go live in Nazi Germany where you can discriminate all you want. If you where intelligent you would be studying economics or psychology and trying to work out why people struggle academically. You obviously have no idea about how society affects people. You may be lucky to be in a position where you think other people are second rate. Prove to me its not just luck! |
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| Date: |
20 Aug 2008
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Bohater hater ()
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| Bohater, you sound like some jumped up, clueless graduate trainee. Probably a spoon fed public school, Oxbridge drone too. Trust me, you'll end up working for the Big 4 before long.
In my experience, having worked to the front office from the back office via middle office, operations are absolutely essential to P&L. A trading department would lose most of it's P&L if it weren't for the back office keeping everything in line. Given that most traders and PMs are talentless chancers who are vastly overpaid, operations staff should be paid alot more for the responsibility that they handle. Incidently, most hedge fund failures are due to operational loss. Moral of the tale - give back office the respect they deserve. It might not be glamourous or exciting but it's absolutely essential. |
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| Date: |
21 Aug 2008
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jonnybgood ()
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| back office are like the wheels of a car...without the wheels the engine can rev as much as it wants....but it wont go far.... I dont think people realise how hard back and middle office people work and the slack they get from the higher paid colleagues.... maybe they dont need to be aligned with front office but for sure they need to be paid much more...
Mr front office just think what woudl happen if all of your back and middle office colleagues walked out on strike for a week.... now ask yourself how valuable they are.... |
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| Date: |
21 Aug 2008
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Ex FO man now MO man ()
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| All these analogies and arguments used for justifying BO pay is so ridiculous. Just because a BO person spots an error and save £££ for the bank doesnt mean he should be paid equivalent money since that it is essentially his job. A doctor doesnt get all my life savings paid to him just for saving my life although if a situation arose where I had to choose between my life and my money I would gladly pay the doctor. Likewise if a set of wheels doesnt want to drive my engine then I will simply buy another set of wheels who would be happy to do so.
I am for raising the pay for back and middle office but at the same time I would want the standard of personel to be raised. Indeed if the standard of personel was equivalent to those at the front office, those FO people would naturally have more respect the BO. The reason why FO folks have an ego issue is that for alot of them they have gone through life making plenty of sacrafices to get the academic qualifications they have. Why should some who cruised through school and life enjoying themselves to the max then be provided with similar opportunities. Most people can do a FO job but the question is do they deserve to?
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| Date: |
21 Aug 2008
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| Name/Email: |
Alexa ()
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| I work in HR, and believe me, there is no academic gap between front and back office. Someone may have a first class from Oxford in computer science, but will probably end up in back/middle office because of the nature of work.
Banks are currently living on government handouts because of the 'brilliant brains' in the front office. |
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| Date: |
21 Aug 2008
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| Name/Email: |
Brent ()
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| Think everyone is missing BO haters point. To get onto a desk, u must posses a sterling degree from a top uni, and then pass numerous psychometric tests. On our recent intake we grilled the grads...trust me, the interview process in the BO is easy and doesn't require a sh*thot candidate. When i interviewd for my role, I was asked about the NZ yield curve and its impact on long term bonds and i-rates. I have friends in ops and the hardest quest they got was could they use excel....so NO they shouldnt get paid as much as us!!!!!! |
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| Date: |
21 Aug 2008
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Wizard of EC1 ()
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| The assumption that there is any real difference in "standard" of people between FO/MO/BO is erroneous. I’ve met some rather dim Traders and likewise a BO chap with a PHD from Oxford ( hardly cruising Ex FO man). Some very bright people choose not to join the FO and prefer the challenges of the BO or a support environment like IT. Essentially they all have different roles, all requiring above average smarts. I agree, the BO should be paid more, having said that the Traders live and die each day on the risks they take to generate revenue….. the BO don’t have this type of stress …… they have another type of stress like making sure ALL the Traders’ cash flows and ALL deals are settled – this is the sort of stuff that causes stomach ulcers.
Also - need to edit my earlier post - the "brains trust" of the collective FOs have lost £500 billion, not £500 million.
The FO will lose autonomy as a result of the current situation - the Regulators are growing teeth. Expect more "A streamers" in regulator roles and BO control roles. |
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| Date: |
21 Aug 2008
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bohater ()
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| completely agree with Ex-FO man - revenue generation is a consistent process versus error spotting which is random and hopefully less commonplace, therefore should not merit the same reward.
I work as a propreitary trader in BB American bank, and I have lost count of the number of times that I have had to step in for the shortcomings of BO staff and then to make matters worse, they try to conceal they're own mistakes and make out they're doing me a favour.
Thats the basis of my dislike for BO staff. A change in BO attitude (being more proactive, open about mistakes, taking a more can-do approach) would go a long way to addressing this dislike for me.
There are some exceptions to this and those I would give utmost respect, but they are as said exceptions and generally not the norm.
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| Date: |
21 Aug 2008
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| Name/Email: |
Flo ()
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| Yes. And let's all give all public sector workers an above inflation pay rise! Oh and create a tax for the super wealthy. And ban sports days - we don't won't losers feeling left our. That way we can be sure to keep the Great in Britain |
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| Date: |
21 Aug 2008
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M986 ()
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| Clearly the FO revenue generation is the key to the business but what recent market events again highlights is that controls are vital in order to avoid long term losses. The same CDO traders that made millions for their firms in 2006 saw their trades generate vast write-downs in 2007 and beyond. Therefore financial institutions will have to improve structure and performance in non FO areas (including increasing pay). Of course in ten years time when markets are booming and all is forgotten again BO functions will be sidelined in the quest for better profits.... and the process repeats itself. |
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| Date: |
21 Aug 2008
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FORMER ISDA guy ()
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| BO people should have a lower pay because they are not as smart but merely because BO is less risky than FO.
RISK=REWARD
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| Date: |
22 Aug 2008
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tiksklafandri ()
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| Exactly, it's a risk-reward matter ,for those who are working in the finanacial markets and have not understood it yet. At a time where lots of traders sweat and stress to get their pay, risking their place by the way BO people are having coffee in starbucks and playing games on their PCs and often take ages to solve P/L sensitive issues. I have a full respect for BO/MO/FO people but these are facts. There are limits. And finally, to counter a remark made earlier : it is not a shame to lose 10bn in one year if in 10 years you made 100bn, at the end of the day FO people are human beings and can make mistakes. And if the result now is staff cuts, then staff hirings and bigger bonuses in the future will be back thanks to those who one day lost 10bn. |
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| Date: |
24 Aug 2008
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| Name/Email: |
Michael ()
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| This is for BRENT.
Can you please inform us this question.
What SWIFT message is generated when a spot deal is done by the FX dealers?
Please be a man and answer the question without refering to the internet or asking work mates.
Cheers. |
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| Date: |
26 Aug 2008
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Donald Duck ()
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| No but seriously guys : How old are you and how much experience do you have ? Not much by readings comments of Brent and alike.
Guys : If your average FO employee was anywhere knowledgwise where it is assumed through the written comments above, they wouldn't work in FO for Investment Banks, but in Investment Management in Risk or Portfolio Mgt or research ! C'MON !
Since when FO in Sell Side gathered the brighest people ?????????
Please : give me a break. I can kick a bin and find 100's of traders or sales in it !
You see, Brent and alike (bothater or whatever your name is)...The BIG difference between the buy-side and sell side is as follow :
In the sell side , you hang up and then say : go away
In the buy side , we say go away and then hang up ! and despite that... you guys keep phoning back for more (which i really like...complete climax for me )!
There are a reason for that, and that comment alone illustrate a lot of difference in the intrinsec qualities found in either side of the business.
Couldn't see the difficulty in most FO jobs really !
I think FO guys should be paid the same as BO guys really while BO wages reevaluated significantly. |
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| Date: |
26 Aug 2008
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Bernard ()
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| This topic always stiulates commenting. The reality is that you need to originate in order for BO to check and transfer. It is a bit like formula 1, drivers need the team to win, but without the drivers, there is no team needed...
I dont think it is as black and white as portrayed above, some people prefer not to be in the limelight of front office jobs. Talent is needed everywhere, but compensation for processing can never be equal to originating; it defies common sense. I thought communism was largely dead...? |
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| Date: |
26 Aug 2008
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innocentbystander ()
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| you're only as strong as your weakest link. if your bo staff sucks, then doesn't matter how much revenue you generate if they can't process the trades. this holds true in any industry. and it's absolutely absurd how much $$$ fo personal are paid / have been paid especially in light of what's happened to the economy. personally, i think the fo people should give some of their past bonuses to people who are having their homes foreclosed. fo staff are not that brilliant and did not attend a top tier school to warrant earning 7 figure salaries and up. |
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| Date: |
26 Aug 2008
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PaiviT ()
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| I've worked in product control for nine years and can say that by and large, FO make far more mistakes than BO/MO, as well as commit dodgy/fraudulent transactions. I've never seen BO/MO people drinking coffee and playing computer games, they've always been far too overworked and stretched, trying to clear the traders' frequent/constant misbookings. Often, traders don't care if they leave any info out, as there are others, minions, as they're known, to pick up the pieces.
My last MO contacts started at 7am and finished around 9-11pm, every day, as the FO could not book a single trade correctly. And, as soon as the FO start losing money, it's the BO/MO/PC that takes the first job losses, forcing the remaining staff to put in even longer hours and endure even more stress, and take longer to resolve issues. This is all exacerbated by the fact that BO functions have been moved to a different timezone, so the timely resolution of issues is no longer often even possible. |
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| Date: |
26 Aug 2008
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| Name/Email: |
indiajack ()
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| FO has been running unchecked. They activities at many a time have not been subject to the risk process. Sometimes there a 1000s of FO generated trades that have not been risked properly and that includes looking at the underlying savvy of the models and not just spurious mathematics.
70% of FO bonuses should perhaps be undrawable for 5 years. Or perhaps now risk and be pay should be more aligned to FO as they wll have a better idea of the price of risk and the effect on capital. They should also be able to stop bad deals the FO are proposing, e.g. everyone is making money doing it so let's join even if we think it may not be a sound idea because I want my bonus or my boss is going to penalise me for not making as much as the competitor bank.
Hence there is an argument for higher base salaries butl much lower bonuses for FO and increased salaries and higher bonuses for the rest. This is only a simple explanation. The premise iand details are a bit more involved and not for this forum as yet. |
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| Date: |
26 Aug 2008
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| Name/Email: |
derivator ()
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| Offer-demand:
1. if you can get a guy to do the same job for less, fire the expensive and hire the cheap
2. If the pay is not so good ... you will get a not so good guy...
3. Since it is easy to recruit now ... reduce the pay of BO, MO & FO!
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| Date: |
26 Aug 2008
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| Name/Email: |
Euan ()
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| I work in asset management with a reasonable amount of experience in financial stocks
The financial sector is unique in that, although in a downturn, the best managers do best...when things are booming you want to overweight banks that are managed by the biggest cocky r*tards as they take the biggest risks and get rewarded for it. I'm sorry B.O. boys and girls but this industry pays for risk takers not intelligence |
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| Date: |
27 Aug 2008
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| Name/Email: |
Dean ()
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| Peoples pay generally reflect how much it costs to find an adequate replacement for that role, ie whatever the market rate is for that role. I work in the front office on a bond desk for an asset management shop, and I know that our back office are well trained and do a good job, but I also know its not hard to train another person up in a few weeks to replace them. There are always plenty of people to join the BO as anyone with a bit of experience can do it. This keeps a ceiling on any pay rises they request. Where as if we were to replace front office guys, their specialist knowledge is a bit harder to come by as trading experience + academic qualifications are mandatory. I know in our firm that a minimum of a masters is expected and they prefer people to have at least started their CFA qualification. This doesnt make them particularly special, in fact qualifications to me are just a filter to sort the wheat from the chaff, it doesn't automatically mean they are going to make us a fortune trading . Basically, the more specialised a role is, the higher the salary is for that particular role. It boils down to simple supply side economics. |
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| Date: |
27 Aug 2008
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MBA & CFA Grad ()
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| Controlling costs will never be as sexy as generating revenue growth. People like to see a line graph pointing up, not down. Back office staff will always be paid less than front office. |
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| Date: |
27 Aug 2008
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Economics Grad ()
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| I am a BO worker. I respect the traders for what they do, but ive spent a long time unravelling what they thought they traded and telling them how to rectify it when I call other banks to ask for funds and find we actually owe them. How about revauing the wrong leg of a mtm trade anyone? |
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| Date: |
28 Aug 2008
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Chico ()
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| Has anyone heard of a guy called Phil McGuire? He is currently revolutionising the BO with his ideologies on tight pant management! |
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| Date: |
29 Aug 2008
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Gecko29 ()
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| I work in trade support and agree most people I work with are idiots who only know what button to press but dont know why they are pressing the button most do not understand any of the economics or theories behind products and trading stratigies, hence why i am doing my FSA exams and moving on. But mind you there are some bright people in BO. Most tend to be in the Hedge fund arena. BO at a HF and at a Investment bank or big Asset manager are two diff animals. due to the small nature of most HF's you have to be Multi skilled and i was carrying out many FO roles while being classed as Mid office at my last HF. |
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