As 2005 comes to a close, we asked a selection of executive search consultants on Wall Street and in Europe for their verdicts on this year's hot hiring areas. Read on for their responses.
Wall Street 2005: Derivatives Specialists, Proprietary Traders, Energy and Healthcare Bankers
Gary Goldstein, chief executive of New York-based search firm the Whitney Group, says recruitment in M&A and leveraged finance hiring were strong in the opening months of 2005, but structured products hiring charged on Wall Street as the year progressed: "There was a lot of activity in credit derivatives, equity derivatives and structured products generally. Everyone from Citibank to Deutsche Bank and Bank of America have been hiring in this area."
Energy derivatives traders were particularly hot, with SG Corporate & Investment Banking adding six senior staff to its U.S. commodity derivatives trading desk in July.
Michael Karp, co-founder and managing partner at international search firm Options Group, says the three hottest hiring areas on Wall Street in 2005 were proprietary trading (fixed income and equities), prime brokerage and structured credit. Deutsche Bank, for example, recruited a team of eight traders from Morgan Stanley in April, while Banc of America Securities was among those building its prime broking arm.
Richard G. Lipstein, a managing director at Boyden Executive Search in New York, highlights energy and healthcare coverage bankers as hot currency in 2005.
For example, he says in August alone, Bear Stearns hired Thomas E. Hassen from Credit Suisse Boston as vice chairman of its global industries group, and Banc of America Securities hired Jamie Saxton from Lehman Brothers as managing director and head of oilfield services.
Europe 2005: M&A, Leveraged Finance, Derivatives
Recruiters in Europe also highlight M&A hiring as a hot, if not exactly scorching sector, in 2005. Jonathan Baines, a director at London-based search firm Whitehead Mann, says heavyweight bankers were back in favor: "The calendar year of 2005 saw a lot more activity at managing director level and above."
Why? Baines points to a combination of strong corporate balance sheets, more supportive investors and private equity money. "Banks became more confident about their deal-pipelines and gained a determination to push forward with their strategic hiring plans and strengthen their teams where gaps existed."
Lehman was among the most veracious purchasers of M&A talent. After lifting William Vereker, Morgan Stanley's head of energy, in March, it went back to Morgan Stanley for Richard Atterbury, then head of FIG banking in June, and then hired Stuart Upcraft from CSFB, who became its M&A co-head in the UK. It also added nine bankers, including three managing directors to its Frankfurt operation, and poached Emmanuel Roger from Société Générale as a managing director in Paris.
Junior M&A staff may have made fewer headlines, but recruiters say they were equally in demand. "There was a need for associates and analysts with one or two years' experience," says Sophie Wigniolle at Eric Salmon & Partners in Paris. She adds: "Banks didn't hire enough trainees during the downturn of 2001 and 2002."
In Italy, Alberto Gavazzi, a consultant at Russell Reynolds, points to leveraged finance as the hot hiring area in 2005. SG set up a leveraged finance unit in Italy, for example, while Natexis Banques Populaires hired ex-Calyon banker Alberto Rossignolo. By comparison, Gavazzi says job moves in Italian M&A sector were few and far between: "Investment banking recruitment has been very quiet - there was a lot more activity in 2004."
There were of course exceptions: Matteo Manfredi and Gerardo Braggiotti both quit Lazard, and Leone Pattofatto joined Credit Suisse First Boston as head of Italian M&A.
As in the U.S., esoteric products took a hand in driving European recruitment. "Pretty much every player hired for structured derivatives," says Tim Zükle, a consultant at search firm Smith & Jessen in Frankfurt. In May, for example, Lehman Brothers strengthened the German contingent of its London-based equity derivatives sales team with the Alex Kilian, Martin Bertschhead, Juergen Bossler, all from JP Morgan.
"Derivatives has had a record hiring year again," says Antoine Morgaut, head of financial services recruitment at Robert Walters in Paris. "All the big players, from BNP Paribas to Calyon, have been looking for structurers and technical product traders."
But the coup d'etat in the European derivatives market was Merrill Lynch's extraction of a team of 23 derivatives specialists from JP Morgan in June. The mass migration included Antonio Polverino, a former Merrill derivatives banker, whom JP Morgan had recently promoted as head of its corporate derivatives group.
In France, Morgaut says French asset managers were among the big hirers, dispersing a certain inertia in the sector. He says Axa Investment Management, BNP Paribas Asset Management and CDC Ixis Asset management hired in for front office money management and marketing roles and for back office support roles, driven by recovery in the French equity markets.