Nick Goodway: Let's box clever and give big-hitter Terry a watchdog role in the City
Midweek View: If he's got a problem, he confronts it. There's a touch of philanthropy and a wave of the Union Jack too
Wednesday 07 March 2012
To paraphrase John Cleese in Monty Python's Life of Brian: "What has Terry Smith ever done for us?" Don't ask the 180 brokers and backroom staff who are getting their marching orders from his broking firm, Tullett Prebon. Their thoughts are unprintable in a family newspaper.
But given they are what used to be called money brokers – until the world of lap-dancing realised it was these clients which gave it a bad name – their thoughts in any circumstances are pretty dodgy.
And don't weep for them too much. The cost of removing those 180 people is £18.5m. That means an average pay off of over £100,000, and in the case of the traders in the dealing room probably a lot more. Tullett still employs about 1,600 people, half of them in the City of London. So Terry still has a fair few in gainful employment.
He was the man who threw down the gauntlet when the 50 per cent tax rate came in. He told his brokers they were welcome to flee to easier tax regimes in Singapore or Zug. His only proviso was that entire trading desks had to agree among themselves to make the decision en masse.
Which was more important? Not paying an extra few grand in tax or keeping little Johnnie and Esmeralda in their nice private schools in Surrey? Changing the diet to noodles and fondue or sticking with the Moët & Chandon down at Spearmint Rhino?
To the best of my knowledge, not one single trading desk quit London. (Think on that, Prudential.)
That's typical Terry. If he's got a problem, he confronts it. He is an amateur boxer, does Muay Thai (whatever that is but it sounds violent) and likes sailing. There's a touch of philanthropy and a wave of the Union Jack there too.
We are pretty much contemporaries who share similar educational backgrounds. Grammar school, proper, red-brick university, the lure of London and then the City. Shame is he did the City properly, I just write about it.
Mind you, he has always been great copy and even better gossip. He's now in his fourth decade in the City but the alarm bells didn't really begin to ring until the late 1980s when, as BZW's top-rated banking analyst, he issued a "sell" note on his parent company.
The next decade, he was fired as head of research of UBS after penning a book, Accounting for Growth, which questioned some of the more dubious number-crunching practices of public companies, some of whom were clients of the Swiss bank.
UBS's loss was Collins Stewart's gain. I remember meeting founders Andy Stewart and Leigh Collins when Terry was at the height of his powers at UBS. These two gentlemen had built a modest stockbroking firm under the kindly wing of Singer & Friedlander. There were a couple of dozen desks some dealing screens and a handful of articulate analysts.
Up bowled Terry – jobless and angry. He engineered a management buy-out from Singer on excellent terms, floated Collins Stewart on the stock market, took over the money brokers Tullett and then Prebon. OK, it took the best part of decade, but by the time it came to the demerger of Collins Stewart and Tullett Prebon in 2006 he was the driving force behind not one but two companies valued at £1bn each.
Life isn't all roses. Collins Stewart was taken over for just £253m by Canaccord at the end of last year. Tullett Prebon is now valued at some £670m. So £2bn of value has come back down to less than £1bn. But it is key that this value remains in the hands of the maverick and his supporters. Terry says what he thinks. He even claims he and Sir Mervyn King are in agreement that the austerity plans and pumping billions of extra liquidity into the system cannot solve the eurozone crisis.
After all at Tullett, he should know. When the European Central Bank (ECB) injected €530bn (£442.45bn) into the system last week, the broking firm saw not a penny of it.
Says Terry: "The ECB ejected the cash, the banks issued bonds and put the money they raised back on deposit with the ECB. Great isn't it?"
Now, if I found myself on fire on the street and Terry was nearby with a bucket of water, I would expect to have to reach for my wallet. If it's professional firefighting you want, you have to pay for it.
So come on, let's get Terry on one of the new regulatory bodies – the Bank of England's Financial Policy Committee springs to mind.
Seconds away, round two.
- 1 Bill Clinton portrait features Monica Lewinsky reference, artist admits
- 2 Delhi bus rapist blames dead victim for attack because 'girls are responsible for rape'
- 3 PornHub turns masturbation into energy in bid to save the planet
- 4 Have sex with your iPad thanks to the new sex toy no-one asked for
- 5 Average penis size revealed: Scientists attempt to find what is 'normal' to reassure concerned men
Bill Clinton portrait features Monica Lewinsky reference, artist admits
Delhi bus rapist blames dead victim for attack because 'girls are responsible for rape'
The 'sex selfie stick' lets you FaceTime the inside of a vagina
Kanye West gives guest lecture at Oxford University: 'If I, Kanye West, can remove my ego, I think there's hope for everyone'
'This is what Islam tells us to do': A rare glimpse inside a Saudi Arabian prison – where Isis terrorists are showered with perks and privileges
New theory could prove how life began and disprove God
'Jihadi John': CAGE representative storms off Sky News accusing Kay Burley of Islamophobia
This is what it's like to be dead, according to a guy who died for a bit
Ukip would cut billions from Scottish budget to fund English tax cuts
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
End of the licence fee: BBC to back radical overhaul of how it is funded
iJobs Money & Business
£20000 - £21000 per annum + uncapped commission: SThree: As a graduate you are...
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...
£15000 - £16000 per annum: Recruitment Genius: A Customer Service Advisor is r...
£22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...