And that’s not all – the division of the firm formerly known as investment banking will henceforth be known by the altogether less inflammatory sobriquet of ‘global financial advisory'. To those of a certain age it inevitably calls to mind the time when pint-sized popster Prince replaced his name with a symbol, only for everyone to end up calling him TAFKAP instead.
So why is this historic institution suddenly so keen to ditch what it calls its ‘investment banking image’? After all, the Rothschild name is one of the oldest and most distinguished names still operating in the City of London, and Nathan Mayer was the Daddy of the whole thing. He it was who financed the Napoleonic Wars, and coined a phrase which ought to give any faint of heart modern investors food for thought. ‘Buy when the blood runs in the streets’ was his gung-ho motto.
Well, for starters as we all know, investment banking as a business sector is not exactly riding high in the public opinion stakes just now. In fact investment bankers might even be less popular than journalists and estate agents at the moment, although probably not for long. There are some good reasons for all that public opprobrium of course, and the Banking Commission and many other worthy dignitaries are pondering exactly What is to Be Done About It at this very moment. But Rothschild has clearly decided that for the time being, a change of name is a lot quicker and more cost-effective than all the rigmarole of a change in modus operandi.
To be fair to Rothschilds – now a minnow by comparison with giants like Goldman Sachs and Morgan Stanley - the kind of investment banking it gets involved in is not quite the same as many of its larger rivals. It concentrates on advising its clients and doesn’t sell shares, thus claiming to avoid the ‘chinese walls’ required to avoid (ahem) the conflicts of interests which can occur in other institutions.
But even so this looks like a pretty rum response to the issue of how to restore the reputations of our banks. Here at MT we think that whatever the answer does turn out to be, it will involve more than a bit of smoke and mirrors from the marketing department.