Respected Rochdale Securities bank analyst Richard Bove has trained his sights on Morgan Stanley, and isn't sure he likes what he sees.

Commenting on the firm's decision to hire 400 traders and salespeople, Bove wonders if this is yet another example of Morgan Stanley demonstrating it is behind the curve. Bove wrote in a note to clients this week that news of the hiring spree was 'unsatisfactory, since it is being revealed without any backup or justification'.

Bove said that, over the last decade, Morgan Stanley had a history of moving 'too little, too much, (or) too late', and points to the fact that the firm went into alternative investments and the housing markets at the wrong time, didn't foresee the collapse of the dot.com boom, and pulled back from markets too drastically when it shouldn't have.

In the meantime, Reuters reports that US regulators are to launch a probe into Goldman's practice of offering top clients trading ideas / views ahead of releasing such information to the little guys. Critics say that this is an unfair advantage, while cynics say that it is business as usual on Wall Street.

And The Financial Times reports that French President Nicholas Sarkozy has confirmed that French banks will be barred from lucrative government mandates unless they agree to new international standards on bonus payouts. Bloomberg quotes Michael Holland, from US mutual fund Holland & Co, who said: 'This is demagoguery run amok. If the best and most qualified bankers go to places where they are compensated for their work, it means that Sarkozy will be doing business with only those that don't have the highest degree of excellence'.

The newspaper also reveals that, according to documents filed by Bank of America with US regulator The Securities and Exchange Commission, senior officials at the Fed and US Treasury were advised of Merrill Lynch's bonus plans in mid-December - before the spoils were actually provided to employees. A new twist, we think.

Finally, UK banking unions were predictably in uproar at Royal Bank of Scotland's decision to slash pension benefits for 62,500 workers, which have been described as 'soul-destroying for the workforce'. Welcome to the real world - plenty of unemployed bankers would swap places in a heartbeat with any banker who wants out.  

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