The COVID Diaries: DCM originator 9

The following interview is with an Australian-based debt capital markets originator. It was conducted on 24 June 2020.

Restrictions are easing quickly now in Australia. How has this affected your working arrangements?

At this stage there has not been any change. Those considered essential are the first to be able to go back into the office, which in banking is those that are customer facing.

In wholesale banking I would suggest the efficiencies which have been proven via the quarantine of the workplace are quite amazing. I have all the systems I need to do everything I need to do from outside the office. Sure, I have not been able to physically meet with people, but this is a small part of the workplace if you can do virtual meetings. This has been a fantastic time to prove these systems work.

Are you making any plans for in-person meetings or business travel in the second half of the year, given the way things are going?

I have had one or two people ask for meetings, but my preference is not to at this stage. We still do not really have the green light from government to meet in a way that is socially appropriate.

Everything I need to do is being done, only more efficiently, in the way I am working at the moment. I tend to spend most of my time during the day focusing on key things. Whether it is upcoming transactions or pitching to clients, it can be done from home and I am saving a lot of time.

Australia has had great results in its health outcomes but the economic impact is still playing out. Considering this are you now more or less optimistic about the crisis than you were during the preliminary stages?

I am more optimistic. I think the government has done a tremendous amount of work to meet this head on and what has been achieved by the federal government is somewhat unheralded.

We were in a financial and economic position to deal with this crisis after 29 years of economic growth. We could meet the expenditure required for JobKeeper and JobSeeker, which was a tremendous and unique position to be in.

I did not know this at the start of the crisis, but I know it now. I know how many people have availed themselves of this support and how many businesses that as a result have been able to keep paying their staff. My confidence is boosted by the financial capability of Australia.

I have been asked by a lot of people why the stock market is doing so well when we are in such a dire economic position. The stock market looks at prices effectively in 12 months’ time and I think this is a signal of the confidence in the market.

The IMF has said publicly that we will drop 6.7 per cent in economic growth this year but gain 6.1 per cent next year. A 6.1 per cent economic boom is three times what we would normally have in one year, so I am quite confident.

“We were in a financial and economic position to deal with this crisis after 29 years of economic growth. We could meet the expenditure required for JobKeeper and JobSeeker, which was a tremendous and unique position to be in.”

A lot of the bullets now appear to have been spent with government stimulus, though. Would you still be confident on the outlook if there is a second wave of the virus?

There has been a lot of stimulus and it would of course be ideal not to need this. But the fact is we had the capability to do it, which is a much better situation than in a lot of countries.

A second wave of the virus would be a problem. It is not that we could not go and spend more, but we would be putting ourselves very deep into debt – perhaps even more than a lot of countries which have been running with a lot of debt for a long time.

Australians have done very well in locking this down though. We have mostly done as we were told, perhaps better than everyone but the Japanese. This has served us well.

I was slightly worried by the protests a couple of weeks ago – not with cause, but with the way they were blatantly disregarding social distancing protocols. Three in Melbourne that were at the protests have since been confirmed with COVID-19 and who knows how far they spread it.

By all accounts though Australia has dealt with the situation well. There are only a couple of people with COVID-19 that are in a serious condition. I think a second wave would be bad but the likelihood at the moment is low. We just need to keep the borders shut.

It is incredible that globally there are new records being set for positive cases every other day whereas in Australia and New Zealand seems to be under control.

Don’t forget we have done better than New Zealand on a per capita basis! They get the accolades, but Australia and Finland have done just as well if not better.

Other countries, such as the US, UK, Brazil, Mexico and Peru, have been shockingly bad. We are on an island with a small population, which helps a lot.

Do you subscribe to the view that this crisis will radically reshape our society or do you think there will be reversion to previous norms?

I think there will be a fair amount of reversion to normal. I do think the way we work will change, though, and I am concerned about commercial property in the city. I think office space will open up.

The big proof has occurred. We have had 3-4 months testing these systems and if they do not work now there is something wrong. Why would a company rent floors and floors of office space when it can get the job effectively done using its staff’s homes for free?

For the most part we will revert to norms, though. I think all the social side of life needs to happen, but the workplace is changing for the better as a result of the crisis.

Outside of work how are you taking advantage of eased restrictions, and what are you planning to do that you haven’t been able to for a while?

The key for me is seeing family, and other than this I am very pleased to be able to go to mass again. These two things are important for me.

My wife has elderly parents who have self-quarantined for months now. This is not good for mental health, so it has been very good to see them over the last couple of weeks.

There are a lot of people suffering depression as a result of missing family or other social gatherings like church, so it is important that these things can get going.

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