Morgan Stanley has begun offering investment banking advice to hedge funds and asset managers. Recruiters say other banks are hiring with a view toward doing the same.
Tim Sheffield, managing director of London search firm Sheffield Haworth sees a demand for financial institutions group - or FIG - bankers "with strong knowledge of the alternative and real money community."
"Traditionally, banks were focused on executing hedge fund business, then came prime services and prime brokerage," he says. "Now it's the turn of the advisory business in a consolidating market."
Morgan Stanley has made Huw van Steenis, its co-head of banking research, head of a new division offering advice and financing to hedge funds, asset managers and private banks, according to Financial News Online.
Search consultants say other banks have also been building up in the area. Credit Suisse recently hired Dominic Fry from Hawkpoint to work on asset management and hedge fund transactions, while UBS recruited Morgan Stanley's Steve Niemczyk as global head of asset management coverage in its financial institutions group.
Morgan Stanley is expected to move to replace Niemczyk. "They've got a very big hole," says one search consultant, adding: "Most banks are hiring asset management expertise to FIG teams at all levels."