What do you say of a bank that has missed the bus (India)?

I thank placement committee for doing such wonderful work for the students. It’s a fine committee, pun intended!

As a part of summers PPTs (pre-placement talks), we had an Australian investment bank Macguarie Bank today. Like all i-banks, the talk focused a lot on compensation, profitability et. al. I’m not sure if all was that impressive. Why?

For all the size and presence all over the world (a 11 billion dollar company), the bank has no presence in India till recently. For all the explanations they offer, it shows a lack of judgement on their part. If sacrosanct IIMs haven’t heard of this name, it’s doesn’t reflect that good on the organization, does it?

They are an advisor-investor rolled into one. I raised the issue of conflict of interest there. If we put money to back up the investment advice we give, doesn’t that add credibility, they reply. Fine, but there are a few things to consider.

If it does add credibility, why doesn’t Goldman sachs or JP Morgan do that? The advice is sought not just for what you give them, but more importantly, how you got to that conclusion. That is why GS doesn’t need to back its claims with money.

Not all advice turns out correct. Investors know it. (Of course, if you keep giving them bad advice, you are unlikely to get business) But I’m not sure if investors care if you put money along with them or not. If they lose money, they wouldn’t appreciate that you are losing with them too.

But there are a few things I liked about the company. One of course, the fact that the company is making a lot of money. Two, there is no history of retrenchment. Considering the way things turn out in I-banks and consulting companies, this is impressive indeed.

All said and done, why do I care? They are going to take one or two people- bright IIT grads. Let me better make my CV good for other companies.