German fund management: The promised land?

International fund managers are suddenly interested in establishing a presence in Germany. Headhunters in the country report a concomitant rise in hiring.

"Everyone is trying to build in Germany at the moment," says Patrik Von Pfetten of the Frankfurt search firm Von Pfetten & Kollegen. "Germany is seen as a good target. The entire asset management industry here is growing drastically, and both local boutiques and international firms are hiring."

John Wittgenstein, a consultant at Korn/Ferry International in Frankfurt, is similarly enthusiastic. "International firms are repositioning themselves," he says. "This is a big market, and the barriers are coming down."

In the past, Wittgenstein says six large local fund managers - DWS Investments, Union Investment, Deka Investmentfonds, Deutscher Investment Trust, Activest, and Cominvest - accounted for 80% of the German market. But he says this is changing following deregulation and 'open architecture', under which established players are offering rivals' products via their distribution networks.

As a result, Wittgenstein says groups such as Credit Agricole Asset Management, which previously withdrew from the German market, are seeking to re-establish a presence. Legg Mason, which acquired Citigroup Asset Management last year, is also said to be interested in opening up in Germany, while Danske Capital, the Danish asset manager, is also looking at the market. Belgium-based Dexia Asset Management is to open a new office in Frankfurt by June.

Von Pfetten and Wittgenstein say demand is focused on sales and marketing staff who can bring in new funds. "International groups are looking for a quick return," says Von Pfetten. "The emphasis is firmly on sales." By comparison, production is likely to remain in the UK or the US.

Wittgenstein says an experienced German marketing person can expect to earn a salary of between €150,000 and €250,000, plus a performance related bonus.