Just a few things to touch on and then we move to pastures new.
I never took too many trading positions except in the trading of investment and property currency but occasionally I would get the chance to quote Deutsche Bank in Dusseldorf for forward D Marks. This was generally not successful as they were normally dealing with a few banks at a time so the market always moved against me but sometimes it worked if I sat on the position long enough.
Someone had the great idea, following a visit by the Commercial Bank of Greece (CBG) that we should enter the Greek Drachma market. This was a lightly supported market in the UK so it seemed like a good opportunity. CBG would regularly give us fixed trading prices for Drachma against USD so we could generate Cable business as well. It wasn’t our biggest earner but it was an introduction to Greek banks which was useful in later years.
One day, at lunch with Mike – a Swiss Franc broker from Harlow Meyer – he told me of a simple way that they had of calculating forward Swissy/GBP swap prices from Swissy/USD and USD/GBP. I expressed an interest as it was something that I got involved in on occasion. He sent me round a few sheets of paper which had a table written out in long hand – not many photocopiers around at that time. You could read off the Swissy GBP price by finding the required two rates around the edges with the answer being at the conjunction on the table. I was quite thrilled with this until John Botevyle told me that, until I could explain how it was calculated, I wasn’t allowed to use it. Although I had been good at maths at school, I wasn’t up to the explanation at that time and neither could Mike so I had to leave it alone. In later years I was not only able to understand it but I ended up working out where it was too simplistic and creating a formula that did really work.
One final fling on Canadian Dollars. In those days, we had direct lines to both Commercial Cable and Western Union. We only ever used these for cables between us and Royal Bank of Canada in Montreal. They used to send us a cable that was on our desk overnight. It was a trading price in $1,000,000 Canadian. We could then trade off that price until their opening. I had a conversation with them once, when they telephoned us. I told them that, when the market got away from their price, I would withdraw it but I was assured that I should trade of the back of their price no matter what the market did. I never understood this!
The final crunch came during a conversation I was having on the phone with Brian Bennett – a Canadian $ broker at M.W. Marshall. I was bemoaning the fact that I didn’t get a job within the bank that I thought was coming my way. The bank had decided to re-invent County Bank. County Bank was one of the constituent parts of the District Bank back in its history and the idea was that it would now be a merchant bank like organisation. The plan was that I would become the one and only dealer at this new bank when it started. This filled me with excitement but my hopes were dashed when they decided that what they wanted was not a dealer but a processor to manage the transactions. This resulted in someone called Ramsbottom from head office in Manchester getting the job. This upset me as it would have been quite exciting and very good for my career. Brian’s suggestion was that I leave and go to join one of the myriad overseas banks that were either arriving in London hotfoot after the regional American banks. On muttering about job security and other worries, Brian asked what salary I was on. At the time I was on around £850p.a. (see earlier discussions about present value!). My coming clean resulted in guffaws of laughter. On asking what was so amusing, he pointed out that I could probably get close to doubling that! Now he was talking. He gave me a few more insights and suggested that I should get on with it.
There was another reason that I was interested in his comments. This was that the District Bank was due to be merged into the National Westminster Bank along with National Provincial Bank and Westminster Bank. This wasn’t due to take place until the 1st of January 1970 so about 18 months in the future but firstly, I needed extra money now and I wasn’t at all sure what the deal was going to be when we all got merged into one dealing room. For all I knew, they wouldn’t want our little team and I didn’t fancy trying to get another dealing job having been left out in the cold. Also, I wasn’t at all sure that a 100% salary hike would be on offer. So, I started looking.
I didn’t want to go to an American bank. As a genre, they had a reputation for pushing you out if you didn’t meet their high up-front targets. I hadn’t worked with any targets so far and was a bit hesitant of taking on what could be a life changer. I started checking the Financial Times on a Thursday as that was the day that dealing room appointments were listed. True to form, there wasn’t much about. Isn’t life always like that? I remember one interview at the Trade Development Bank where the interviewer seemed only interested in finding out the names of our biggest customers so that one didn’t work. I can’t remember too much about any other interview but the one that interested me most was with a new startup bank that was being created by Bank Julius Baer in Zurich. I will go through that in more detail in the next posting.