Lies, Damned Lies and League Tables

I remember the days when I’d walk into the lobby of the bank and proudly set eyes on posters highlighting the firm’s latest awards and accolades. Investment Bank of the Year, Energy Deal of the Year, Derivatives House of the Year, All-Europe Fixed Income Research Team of the Year, and more. I’d think to myself: Man, I am so proud to be a part of such a great institution. If the bank had a national anthem I’d recite it every morning as I stepped into the lobby. I’d possibly she’d a few tears on Results Announcement days (Full Year, Half Year, Quarterly updates).

As I grew older and wiser in banking years, my attitude changed.

Before long, I began to feel that there was something slightly strange about having self-glorifying praises plastered everywhere in sight within the bank. We should be proud of accomplishments. I will be the first to admit that the bank was involved in some landmark transactions. And, yes, lots of value created. The problem, however, was that the ubiquity of accolades was beginning to look like a thinly-veiled propaganda campaign.

Am I part of a cult, I wondered? Sometimes, I felt, indeed, I was. If our CEO was suddenly admitted to the hospital for minor surgery, would hundreds of distraught bankers weeping hysterically throughout the building? No, this wasn’t North Korea. Yet the level of devotion to the firm meant more than a handful of individuals would be affected.


Imagine this: you only show a kid movies like Superman, Independence Day, Spiderman, The Day After Tomorrow, Armageddon and other momentarily enjoyable yet absolutely mind-numbing films. Aside from having a terribly limited view of cinema, not to mention the cultural intelligence of a spring onion she/he will end thinking that only America is globally relevant and that the rest of the world is simply behind or useless. See where I am going?

One morning soon after I entered the building I walked right up to one of these posters. The accolade spoke, as it were, the language of nationalism and identity to me. By highlighting our accomplishments it drew a line for me. One which divided the “self” (us) from the “other” (the rest). I thought it interesting and walked away.

Then, on a routine visit to another investment bank – a Managing Director of a competitor bank called and invite me to “coffee” which was a euphemism for job interview – I took particular notice of their awards and accolades. Plenty of parallels with our bank. Same ideologies clearly at work.

The deeper you go into the rabbit hole, however, the more interesting things become. Namely, that ‘ibanking nationalism’ is predicated on a fair bit of fiction just as many countries continue to be. Enter the League Table, a chart which ranks investment banks in order of achievement, ability, sexiness and splendour.

The league of extraordinary tables

League tables are also ubiquitous in the investment banking world and nowhere more so than in the countless presentations and pitchbooks churned out second after second by the legions of dedicated fee-starved bankers. But what makes league tables so very unique isn’t the fact that they are wholly self-appointed or manipulated to ensure the biggest ‘wow’ factor; rather, much like Harry Potter’s world they are often utter fiction. I learned it the hard way.

One day, I was working on the remaining section of a pitchbook for a sub-Saharan African utility company. We needed a handful of league tables to populate a few slides and of course to show our relative position vis-à-vis other banks in different areas, including by product and sector. There are many ways to create tables. At the bank we used one of the leading technology platforms to do so, Dealogic.

Think of Dealogic as an airbrush specialist for top models in the finance industry. The models here are investment banks. No matter how poorly the bank performed in a particular sector (e.g. Telecommunications) or product group (e.g. M&A) you could always rely on Dealogic to be número uno, at the top of the charts and way ahead of the competition. Using Dealogic was even better than manually writing your bank’s name in the First Place row. Why? Because it allowed you to give yourself pole position with a semblance of objectivity. What’s more, it was easy to use.

Say you wanted to create a league table displaying your ranking amongst investment banks who have worked on financial institutions deals in Africa. Let’s assume your bank has only worked on 2 deals in the continent and that was over 5 years ago and there was nothing noteworthy about either of them. If a truly objective league table was commissioned and whose sole purpose was to pinpoint the most experienced investment bank with the most distinguishing track record you’d never want the results shown to prospective clients. Just as premature ejaculation or yeast infection would be the last thing on earth you’d want to raise when you’re flirting with a sexy, very attractive and single individual in some exotic location as you’re both moving towards the same goal.

Back to the pitchbook for the sub-Saharan African utility company. This was my first go at creating league tables. I wish someone had slapped me before I handed over a printout of the results to the managing director (MD) covering Africa. This guy was absolutely fanatic about his clients and was involved in all iterations of pitchbook drafts.

The ibanker: (handing over the printouts to the MD) “here you are.”

The MD stared at the first page for half a second, put down the printouts, looked up towards the ceiling, picked up his phone, called the desk assistant whom he normally just yelled out for when needed.

MD: (very calmly) “yes, can you come round with a rubbish bin please…right away.”

The assistant swiftly came over with a small wastepaper basket.

Assistant: “here you are.”

I could tell by the sound of her voice and tone that this was not first time he made such a request.  The MD crumpled the printouts and threw them into the basket.

MD: (before he gets back to work and begins going through his e-mails he addresses his assistant) “I don’t want this kind of shit infesting my desk…please take it away.”

Awkward moment…

I turned around and walked back to my seat more than slightly surprised. A quick glance around revealed that nobody really paid attention to what just happened. At least it wasn’t a big deal. One of the characteristics of our work area was that people were often so busy and immersed in their own work that lots went unnoticed.

Make me star

So I signalled over to an Analyst nearby, to come help. I quickly saw how silly I was to run a standard search. When creating league tables you basically provide the software inputs and based on what you provide the system formulates rankings. My mistake was to limit the number of inputs. For example, if you were truly a leader in a particular category then the following inputs would suffice:

  • Date range =  2000-2008
  • Region =         Africa, or Global if you are the undisputed leader
  • Sector   =         Utilities
  • Finally you ask the program to come up with rankings according to, say, total deal amounts done

I ran a query using the above parameters and the ranking I came up with, which our MD disgracefully rejected, placed us in 9th place.

The Analyst showed me the limitless ways of moving our ranking to top place by both manipulating existing inputs and adding some additional layers:

  • Date: rather than going with the standard format for a particular year, i.e. starting on 1 January of each year, you could manipulate starting points to begin on, say, the 30th of January, 15 of February or later in the year.  The number one bank may have done 2 mega deals before the 20th of January so by starting the year on 21 January you obviate those deals
  • Region: here you can include or exclude certain countries.  If the top 3 banks in the initial ranking did deals in South Africa then you can exclude South Africa as part of the query.  You may throw in North Africa or exclude it depending on how beneficial it is for you
  • Sector: here you could include or exclude certain sub-groups.  For instance for the Utilities sector you could include or exclude water or sewage
  • Deal value: here we can limit the ranking only to deals of a particular size.  For instance if several of your competitors have done many USD50-100m deals then you would only include deals greater than USD100m and then in the title of the ranking table include something to the effect that this is a ranking of large deals in this and that sector
  • Currency: have the system only consider deals in a currency which works in your interest and against your competition.  Maybe avoid deals done in Euros if that is a currency you haven’t done many deals in and include those carried out in Sterling if that is your bread and butter.  And if you are the only bank to have done deals in Kenyan Shillings then include that
  • and so on and so forth

Of course, you’ll need to account for these variables – usually as a note in very small font towards the bottom of the page but a) the reader never really paid close attention to them, b) you invariably only mentioned one or two of them when there were over ten to list; and c) the desired effect on the reader was already made.  Oh, and let’s not forget one very important point. The source of this data is a reputable financial intelligence company (Dealogic). It was a third party program. Not ours. We were number one and that was according to this highly sophisticated global financial technology tool. Thank you very much.

The transformation was astonishing. Like taking a mailroom clerk and turning them into a Fortune 100 CEO. Several clicks later, we were number one in league tables which I previously placed the bank in seventh, eighth or ninth place.

I tell you, there are lies, damned lies and league tables.

4 thoughts on “Lies, Damned Lies and League Tables

  1. david k waltz says:

    The funny thing is the “pitchee” knows this as well, and thus tends to ignore that part of the presentation because of it (or use that time to surreptitiously check email).

  2. Steve50nyc says:

    we pull the same stunts at the equity fund I work at. 3 year performance looks horrible, run the 5 year. Add since inception. Ytd is awful? Exclude it, etc. It’s marketing. Get them through the door to close them in person. ABC.

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