The writing is already on the wall that, just like last year, trading conditions for investment banks have become more difficult after a relatively good start in the first quarter. Merrill Lynch boss Stan O'Neal has already referred to 'increasingly challenging market conditions in March' and JP Morgan President Jamie Dimon said the same thing in reference to his investment banking unit and the business climate in evidence so far in April.

It is not unusual when firms begin to worry about revenue that costs come under the microscope again. But CityNews has learned that one well-known investment bank is set to introduce Draconian cost-containment measures, which will radically alter the way staff are expected to operate at work.

Our journalists have uncovered a confidential memo authored by the chairman of a secret committee the firm formed earlier this year to review costs. The firm's Savings Advisory Committee (SAC) has completed its review and drafted a string of recommendations in a report, which the company CEO is believed to have already given the green light to.

Investment bankers will no longer be able to order taxis before they are ready to depart the office for client meetings. The bank has recognised that significant monies are wasted each week as bankers leave taxis outside, waiting on the clock, while they finish their lunches and argue on the phones with their wives. From now on, bankers will be expected to go out and hail a taxi in the street on leaving the office - just like the rest of the human race.

The staff canteen will continue to be subsidized, but, very soon, it will be the staff who will be subsidizing the firm. Prices are going up, higher than those paid in restuarants and sandwich shops outside, on the basis that staff should pay more for the convenience of being able to eat closer to their place of work.

Staff are also being asked to spend more time at their desks, working during the day. The bank has become concerned that staff are spending ever-increasing amounts of time on smoking and loo breaks. To overcome these problems, the bank has installed a sprinkler system in designated smoking areas, which will automatically come on and drench smokers who have been fagging for longer than the permitted five minutes.

Toilet cubicles have also been fitted with timer switches, and doors will automatically open five minutes after staff have entered to do their business. 60 seconds before the timer is triggered, the overhead lighting in each cubicle will flash intermittently, giving staff time to finish up.

Although the firm plans to continue to build its businesses and aims to bring on additional staff this year, external recruiters will not be used to source candidates, as the cost of hiring has become a big issue. Instead, members of the bank's in-house recruitment team will be expected to trudge up and down outside rival firms, wearing sandwich boards which extol the virtues of their bank, and handing out business cards to staff, in the hope of enticing them.

Finally, members of the firm's HR teams have been tasked with coming up with a 'balanced scorecard' for staff compensation, which takes into account not just contribution via revenue, but also considers the cost-savings initiatives staffers have been involved with throughout a bonus year. The bank also plans to induct all staff into its new Non Income Target Scheme (NITS) before the end of the second quarter.

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