We asked Ann Connolly, New York-based global head of recruitment at Barclays Capital, to shed light on the bank's ambitious hiring. Connolly confirmed the bank wants to scale debt league tables, but she was less forthcoming when it came to discussing whether the bank has been paying hefty guaranteed bonuses or not.
Analysts point to soaring costs as proof BarCap has been generous with its remuneration: 'Barclays have accelerated hiring and costs dramatically,' says Mark Thomas at Keefe Bruyette & Woods. 'Guarantees were definitely a part of that.'
Thomas says these payouts should not be a problem and suggest only a delayed payoff for the bank: 'BarCap is dependent on income remaining robust. History suggests they can call this risk well.'
This is fortunate: Connolly says BarCap's expansion has only just begun.
Barclays Capital has been one of the big hirers of 2004. How many staff have you added during the year, and in which regions and businesses?
We've added approximately 2,000 people in 2004. If you want to break it down regionally, the biggest increase was in the UK, where we've added around 1,200 a 38% increase. The U.S. is next with about 500 new hires, followed by Asia. In business terms we've hired for the front office and the back office. In the front office our greatest growth has been in investment banking (relationship management), global credit products (credit derivatives, bonds and loans) and distribution and research
Do you plan to have a breathing space in 2005, or will you keep hiring?
No, we don't plan a breathing space. We aim to add roughly the same number of staff in 2005 as in 2004 and to keep on hiring after that. In 2003 we had around 5,500 staff; we should double this by 2007.
Where will future hires be?
Future hires will be across the board and in all three regions. We expect the largest aggregate numbers will again be in the UK, followed by the U.S. and Asia
Barclays Capital now has a larger franchise in the U.S. When will it reach optimum size?
We don't think of it in terms of headcount. What we want is to achieve a top-five position in all the U.S. product markets in which we participate
How have you gone about assimilating all the staff you've hired? Does Barclays Capital have its own culture or are you just an amalgam of everyone else's?
Culture is a big issue for us. We believe we are meritocratic and a place where if you can handle the opportunity you can run with it. I know lots of other banks say this as well, but we're better at it (really!).
Word on the Street has it that Barclays Capital has been paying large guarantees and bidding up the market. How do you plead?
Not guilty! We pay competitive rates, but no more than our competition. We have a very strong franchise and are conscious of our costs.
Given you ranked outside the top ten for U.S. debt capital markets volumes in 2003, how have you encouraged Wall Street bankers to join you instead of high-ranking franchises like Citigroup, JP Morgan or Lehman?
Key selling points for us are our culture, growth, and the financial strength of Barclays Group Plc.
Where do you see Barclays Capital in ten years' time?
Ten years is a long time in this business; I'm not focused that far ahead. In three years, I hope we will be where we want to be: the premier European investment bank ranked in the top five in each business area we participate in, in each region globally.