Leveraged financiers look to move, lock in pay

With default rates on European loans nudging slowly upwards, recruiters say some leveraged finance bankers are moving jobs with a view to locking in pay at today's high levels before the market turns.

"The market environment is causing more mercenary characters to lock in their compensation," says Lee Thacker, a partner in the financial services team at search firm Highland Partners. "Two-year guarantees have become fairly standard now for MDs who join leading platforms."

Vice presidents and directors can only command one-year guarantees, says Thacker.

Last week, Breaking Views, a comment website, highlighted the rash of job moves in the leveraged finance market, which it said were up two-thirds on the previous year and reflected the scramble for guarantees.

Among the moves, Commerzbank appointed five people to its London and Frankfurt leveraged finance teams at the start of May, and HSBC poached two senior Morgan Stanley leveraged financiers in April.

Leveraged financiers who are only now thinking of moving may well have missed the boat, however. "Most US banks have now stopped hiring," says Thacker. "There's still demand at European banks, but it's already less than a few weeks ago."