Macquarie Group dominates Peter Lee investor poll, as UBS ranking tumbles

Results from the secretive Peter Lee Associates survey are bad news for UBS, as all the nation’s best teams are ranked.

UBS saw its local Peter Lee rankings slump after it was the subject of poaching raids on its staff. Picture: Fabrice Coffrini

Macquarie Group’s equity research team has pipped its rivals in a key 2021 investor survey, as UBS slipped down the rankings after suffering a staff exodus to new firms such as Barrenjoey.

The Australian understands the latest Peter Lee poll, conducted in September, put Macquarie in top spot for research across all investors surveyed followed by JPMorgan and Morgan Stanley in joint second place and Goldman Sachs in third.

UBS fell out of the top three for the first time in more than a decade, to fourth spot, after its research ranks were raided by newcomer firms including Barrenjoey and Jarden. Credit Suisse rounded out the top five followed by Barrenjoey, Jefferies, MST, Citigroup and Jarden respectively.

Industry insiders noted the 2021 results reflected more fragmentation in the industry and after a frenetic year of poaching and musical chairs among banks. Next year would continue to see some movement in senior employees, as gaps were filled, but not at the same intensity of 2021.

The Peter Lee survey gauged the views of close to 100 investors and it includes results across a broad scorecard of metrics such as relationship strength and insights. The results play an important part in determining lucrative bonus payments, which the US and European banks inform their staff of early in 2022. Macquarie’s bonus period coincides with its full-year results, typically in May.

The banks all cut the results in different ways and some firms focus on just the results of their major or priority customers. The 2022 bonus season will be particularly interesting given staff retention is a big theme this year, following rampant poaching of key research, equities and mergers and acquisitions bankers over the past 18 months.

The Peter Lee survey also put Macquarie and JPMorgan in first and second spots respectively across equities sales and research this year, followed in third spot by surprise newcomer Barrenjoey. Macquarie and JPMorgan also took out the top two places respectively for trading.

Macquarie’s results across research and sales reflected the asset manager and investment bank’s strongest combined result since 2012. Sources said Macquarie analysts that rated in top spots for their sector included commodities analyst Michael Garvey, building materials analyst Peter Steyn, infrastructure analyst Ian Myles, real estate investment trusts analyst Stuart McLean and environmental, social and governance analyst Anita Stanley.

JPMorgan ranked in the number one spot for the healthcare sector, gaming and tourism, diversified financials and insurance. The firm’s insurance analyst Siddharth Parameswaran took out pole position for the fourth straight year.

The investment banking industry has experienced its biggest disruption in the local market in living memory. US firm Jefferies swooped on CLSA’s local team in 2019 to set up shop, while New Zealand-headquartered Jarden established a presence in Australia last year and has been growing steadily.

Magellan Financial Group and Barclays-backed investment bank Barrenjoey started making waves across the industry over the past 18 months, luring staff from about 30 rivals to form a new team. The bank was set up by former UBS alumni including Guy Fowler, with bigwig Matthew Grounds later joining in April this year as his co-executive chairman.

On the research side of the business, among the UBS defectors in 2021 were top rated banking analyst Jon Mott who decamped to Barrenjoey alongside well regarded lead UBS mining analyst Glyn Lawcock and transport and gaming analyst Matt Ryan. Former UBS non-bank financials analyst Kieren Chidgey joined Jarden last year.

Investment banks have been reaping the benefits of a record 12 months for mergers and acquisitions in 2021 and the pipeline for sharemarket listings has also sprung back to life, despite some year-end float fatigue.

Firms are jostling to finish the year strongly across all metrics and UBS - which is still faring strongly in M&A advisory and equity capital markets - will want to claw back up the research ranking in 2022.