While Goldman Sachs Group Inc scrapped its holiday party for a second straight year and some JPMorgan Chase & Co bankers had their yuletide gathering in a cafeteria, staffers of Bear Stearns Cos reunited at a velvet- roped bar that sells bottles of Cristal champagne for $450.
About 100 alumni from the defunct securities firm that JPMorgan acquired in March 2008 assembled December 18 at the Dream Hotel’s Rm. Fifty5 on West 55th Street, described on its Web site as neo-Gothic “surreal luxury.” Courtney Dickson, a 25-year-old former Bear Stearns employee who organized the event, said the mood was “nostalgic.”
Dozens more former Bear Stearns employees met a few weeks earlier in the upstairs bar at Connolly’s Pub, the watering hole on East 47th Street a few blocks from Bear Stearns’ old headquarters on Madison Avenue, said Justin Brannan, who worked in the firm’s wealth management unit for three years. The affair brought together about 100 people who paid for their own drinks at the Irish pub’s long, wooden bars.
“That’s where we went after we got sold, so it was a pretty fitting place to get together,” said Brannan, 31, who now raises money for the Bnai Zion Foundation, a charity that funds humanitarian projects in Israel and the US “It was cool. It was like a high-school reunion.”
By contrast, “holiday trimmings” took on new meaning at banks that survived the credit crunch as they cut back or eliminated parties. Goldman Sachs, Citigroup Inc, Morgan Stanley and Bank of America Corp, didn’t host official events this year, after a public outcry over perks and bonuses awarded to bankers whose firms accepted taxpayer bailouts.
At JPMorgan, which didn’t host a companywide party at its New York headquarters, about 200 people from the investment banking unit shared wine and beer for a few hours after work last week in the cafeteria at the JPMorgan Chase Tower on Park Avenue, said two bank employees. They spoke anonymously because they weren’t authorized to speak about the matter. Spokesman Joseph Evangelisti declined to comment. The bank bought Bear Stearns last year as the securities firm collapsed amid the global credit crisis.
“They should not be trying to broadcast to America how successful they are right now by having lavish parties,” said Richard Dukas, president and founder of New York-based Dukas Public Relations Inc., whose clients include Mario Gabelli’sGamco Investors Inc. “It’s absolutely the right thing to do.”
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Two-thirds of Americans say they have an unfavorable view of financial firm executives, making them less popular than Congress and lawyers, according to a Bloomberg National Poll conducted December 3-7.
President Barack Obama recently joined the criticism, saying in a December 13 interview with CBS’s “60 Minutes” programme that he was frustrated that “fat-cat bankers” continue to take large bonuses and fight his effort to revamp financial regulation.
“Given the environment, the firm does not believe it’s appropriate to host or sponsor holiday parties,” Goldman Sachs spokeswoman Gia Moron said.
Two years ago, Morgan Stanley held a holiday party at Lotus, a three-level nightclub in New York’s Meatpacking District and Goldman Sachs hosted one at BLVD, an 18,000-square-foot venue on the Bowery in downtown Manhattan, according to The Business Insider, a Web site started by former Merrill Lynch equity analyst Henry Blodget who follows the business and social happenings of Wall Street.
Citigroup didn’t sponsor any events this year, said Stephen Cohen, a spokesman for the New York-based company, whose biggest stakeholder is the US Treasury. Kelly Sapp, a spokeswoman for Charlotte, North Carolina-based Bank of America, said the lender doesn’t host or fund holiday parties on the corporate or regional level. Individual lines of business might organize initiatives to benefit a local charity, such as a clothing drive, she said.
The Royal Bank of Scotland Group Plc, recipient of the world’s biggest banking bailout, is among British lenders limiting entertainment budgets this year to avoid fueling public anger after taxpayers provided more than £1 trillion ($1.6 trillion) to bail out lenders including RBS and Lloyds Banking Group Plc. RBS is contributing $16 a head toward employee Christmas parties this year, enough to buy two pints of lager and a packet of potato chips.
In New York, 65 per cent of companies were likely to either cancel or significantly scale back holiday events, according to a survey by online grocery store Fresh Direct Holdings Inc. and event industry tracker BizBash Media.
Russ Sonnier, president of Sonnier & Castle, a Manhattan event planner, said his clients, which include financial firms, cut back on food, flowers and entertainment. One law firm removed desserts from the menu and switched to plastic cups from glass stemware, Sonnier said.
Across the US, companies also planned smaller holiday celebrations than they’ve held in the past, even as the number of parties is about the same, said Dale Winston, chairwoman and chief executive officer of Battalia Winston Amrop, a New York- based executive search firm.
The firm’s annual survey found that 81 per cent of companies planned to hold parties, the same number as last year, and 43 per cent of those celebrations were expected to be less lavish, Winston said in a December 18 interview. “The country isn’t in a big celebratory mood,” Winston said.