Holiday Parties Still Over for Wall Street's Big Players
Three years after the financial crisis, the Grinch still hovers over Wall Street. In the precrisis era, big banks were renowned for their extravagant holiday parties. Goldman Sachs once rented out huge halls for its end-of-year galas, which featured appearances by performers such as Harry Connick Jr. and Bette Midler.
In 2007, Morgan Stanley took over several floors of Lotus, then a popular Manhattan nightclub. But, mindful of mass layoffs, flagging profits and sustained anger on Main Street, the nation’s largest banks have canceled firm-sponsored celebrations or moved them in-house to avoid the costs and the criticism.
For the fourth year in a row, Goldman Sachs and Morgan Stanley have shelved their official holiday parties.
The investment banking divisions of JPMorgan Chase , Citigroup and Bank of America have also decided against them.
But groups of employees at all five firms were permitted to hold — and pay for — their own festivities. European firms, hit hard by the sovereign debt crisis, have also scaled back.
The Royal Bank of Scotland , which is still part-owned by the British government, allowed some division heads to partially subsidize their employee parties with up to £10, or about $15, a person in company money.
But employees in the American branches of the bank had to pay for their own parties this year, according to a company spokeswoman.
Corporate holiday parties, in general, are on the wane. This year, only 74 percent of companies are holding them, down from 95 percent in 2006, according to a survey of 120 companies conducted by Amrop Battalia Winston, an executive search firm.
The dearth of company-sponsored holiday parties has jolted the owners of the bars, restaurants and lounges that housed the parties, the tabs for which could run into the hundreds of thousands of dollars.
Steven Greenberg, the owner of 230 Fifth, a rooftop lounge in Manhattan, estimates that Wall Street nightlife used to account for 20 percent of his business.
Now, bank parties at 230 Fifth “are nonexistent, period,” said Mr. Greenberg, though he said that business from foreign tourists has helped replace lost bookings.
“They’re concerned about doing layoffs and on the same day having a press report saying that they’re having a big holiday party,” he said.
Goldman , MorganStanley , Bank of America, JPMorgan, and Citigroup all declined to comment.
With large American firms cutting back on holiday parties, private equity firms, hedge funds and others that operate farther from the public eye are taking their place.
Bridgewater Associates, the giant hedge fund headquartered in Westport, Conn., rented out the Webster Bank Arena, a 10,000-seat arena in nearby Bridgeport, for its holiday party, according to several people with knowledge of the event.
The Royal Bank of Canada held a party for its New York office at Chelsea Piers, in a high-end event space that can accommodate up to 2,000 guests, according to two people who attended but were not authorized to speak on the record about it.
Credit Suisse’s investment banking division held its celebration at Bar Basque, owned by the restaurateur Jeffrey Chodorow. The bank provided an open bar and food including chicken parmesan sandwiches and fried olives.
Still, even that party “paled in comparison to last year’s,” said a person who attended Credit Suisse’s party and spoke on the condition of anonymity. At banks without official parties, some employees are making do with less.
A group of Morgan Stanley employees held an unofficial holiday party with an “ugly sweater” theme at an Upper East Side bar, according to a person with knowledge of the event, while other employees of the firm partied at Dream, a hotel with a rooftop bar in Midtown Manhattan.
A group of R.B.S. employees held an informal event at the Powerhouse Lounge in Jersey City. Other firms have emphasized charitable giving programs intended to draw attention to their good works.
One year after holding a grand gala at the Metropolitan Museum of Art to celebrate its 25th anniversary, the Blackstone Group, the private equity firm co-founded by Stephen A.
Schwarzman, held a coat drive at its holiday party, a low-key affair in the Waldorf Astoria hotel, according to a person with knowledge of the event.
Those kinds of events can provide the morale boost of a holiday party without the reputational risks, experts say.
“At this point, the crazy, expensive caviar nights don’t make sense, but maybe something more subdued would be more appropriate,” said Alison Brod, who runs a New York-based public relations firm.
“It’s pretty sad to do nothing.”