Investment bankers are increasingly leaving Wall Street to work for the companies they advise — and it’s starting to hurt the banking industry in more ways that one.
JPMorgan’s Alejandro Vicente, a managing director in consumer goods, is the latest to make the jump.
Vicente will be working on transactions for the company, which has been on a buying spree lately and also owns stakes in a number of consumer products brands.
But he’s not the only one. Earlier this year, the former Morgan Stanley banker Alban de La Sabliere joined the French drug maker Sanofi, which is now bidding to buy the pharmaceutical company Medivation.
Also in healthcare, the JPMorgan banker Henry Gosebruch last fall left the bank for AbbVie.
Here are some more high-profile departures:
- In July, Blackstone’s chief financial officer, Laurence Tosi, announced his decision to jump ship for tech startup Airbnb.
- Last March, Morgan Stanley’s CFO, Ruth Porat, went to Google.
- The Carlyle Group’s former cochief operating officer, Mike Cavanagh, left to become Comcast’s CFO. Before Carlyle, Cavanagh coheaded corporate and investment banking at JPMorgan.
- The former Goldman Sachs tech banker Anthony Noto is now CFO at Twitter.
- The former Credit Suisse tech banker Imran Khan is now Snapchat’s chief strategy officer.
The departures are a double-edged sword for banks. Not only are they losing top talent, but they could begin to miss out on deals as companies turn to in-house experts rather than hiring on teams of bankers.
We saw that a couple of weeks ago with AbbVie’s $5.8 billion deal for Stemcentrx and Comcast’s $3.8 billion deal for DreamWorks. Neither acquirer hired outside bankers, according to The Wall Street Journal. Both recently hired bankers from Wall Street.
That meant banks missed out on what could have been $45 million in advisory fees for those two deals, according to estimates from Freeman & Co.
In other words, this could be the beginning of a big problem for Wall Street.