Infighting at UBS AG between the head of investment banking and his deal makers reportedly led to the defection of 2 more big bankers.  As reported last Friday by CNBC.com's John Carney, Mary Ann Deignan (head of the capital markets group for the America's) is leaving for Bank of America, while Gary Howe (co-head of financial institutions group for the Americas) also is leaving.  BofA-ML announced that it had hired Deignan to head its Americas equity capital markets.  CNBC hasn’t learned where Howe is going.

Ms. Deignan's departure is so sudden that the bank reportedly had no immediate replacement.  However, a UBS spokesperson said her responsibilities will be taken over by Tom Fox, global head of capital markets to whom she had reported.  Another top banker, Jimmy Neissa, co-head of global investment banking at UBS, is believed to be on the way out as well, though UBS denied this in the strongest terms.

All told, UBS has lost at least 50 dealmakers from its U.S. investment bank since 2009, raising questions about the leadership of its investment banking operation.  Troubles at the firm were recently reported in the Wall Street Journal, which said that Kengeter has held combative calls with senior bankers.  "He told us that bankers are spoiled children and we're the ones who messed this place up," said a senior banker who recently left.  "You would get off the calls and think, 'how can I stay here any longer?'"

Pay levels at UBS’s investment bank are said to be lower than other Wall Street rivals. B ut many at the firm also say a growing disconnect between UBS headquarters in Zurich and the New York-based investment-banking unit is sapping morale.  And then there’s Kengeter himself.   [CNBC.com, 5/20/11]