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Morgan Stanley Spending Big on Recruitment

First, Morgan Stanley cut 4,800 jobs to save money. Now, it might spend the savings - estimated at more than $1 billion - on new hires.

The Financial Times reports the firm is planning to hire executives with an eye toward "(bolstering) its presence in areas such as derivatives, risk management and proprietary trading." The idea is to recruit the best and brightest among those laid off by other firms and enhance the talent in promising sectors and regions, like the Middle East and Asia.

That's a tack being taken by numerous other investment banks, both bulge-brackets and boutiques, as decision-makers struggle to adapt their organizations both to soft current conditions and the prospect of an eventual recovery.

"A lot of firms are looking at this (market downturn) as an opportunity to hire opportunistically," says Roy Cohen, a New York career consultant. He mentions U.S. Bank (the operating unit of Minneapolis-based U.S. Bancorp) and a number of foreign banks.

Executive recruiter Jay Gaines, chief executive of Jay Gaines & Co., says, "This crisis, unlike other crises, I don't think has blunted hiring. But that hiring is very specific and the standards are different than in normal times." When institutions both hire and cut staff at the same time, "The hiring will be far more surgical and far more precise" than the layoffs, Gaines says.

$400 Million From Cutbacks Already Plowed Into New Hiring

The FT says that Morgan Stanley already invested some $400 million in the salaries and bonuses of new staff. The money came from the savings realized from the earlier layoffs, which amounted to 10 percent of Morgan Stanley's workforce. Most of those layoffs impacted investment banking, fixed income and research. Sources told the newspaper the remaining $600 million in savings could be spent before the end of the year to lure the right candidates - but only the right candidates.

This morning, Bloomberg said the firm had hired Luc Francois, previously head of equities at Societe Generale, to run its European equities and global equity derivatives. Meanwhile, Thomas Wong and Eric Cole, both formerly of Bear Stearns, will head proprietary trading and distressed sales, trading and research respectively. A formal announcement is expected today.

Meanwhile, James Brown will join from Merrill Lynch to become Morgan Stanley's global head of commodities risk, the FT said. Blake O'Dowd is coming over from Lazard to head the restructuring group.

AUTHORMark Feffer Insider Comment
  • ms
    5 March 2009

    how does a young and inexperienced person like me find suitable jobs in such turbulent times?

  • kh
    5 December 2008

    Times are tough and it is totally impossible to find a job. I am completely without money. Please write me if you have any creative ways for me to make money. My email address is

  • Fi
    5 August 2008

    What are the key sources of getting one's foot in the door at Morgan Stanley?Are there any recruiting/executive recruiting firms specializing with the top tier Banks?

    Im talking Risk Management, Commercial Banking and Private Equity.

  • me
    5 August 2008

    In my experience as an international banker, Tokyo & Dubai are the toughest places to do business. However, if you learn how to do business there, you can do business anywhere!

  • mu
    1 August 2008

    Indeed; it's the MidEast and Asia! Acronym: BRIC for: Brasil, Russia, India and China! My 3 expatriate career assignments in the GCC of: 18 yrs; on top of: 20 yrs on Wall Street -with NY money center investment banks and Canada-; enabled me to develop business rapport with: GCC HNW clients-Corporate and Private Conglomerates-Bd. Directors and Shareholders. In principle, Arabs entrust their wealth to diligent, knowledgeable, creative, educated, humble, determined and modest marketing business development managers who appreciate what the MidEast has to offer; other than oil; who can capitalise on social, public and investor relations events to tap into the HNW marketplace; who respect Islamic culture, history, customs, heritage and who sympathise with Arab causes. Arabic is essential to making deals last for a lifetime. The language is very difficult. It has many dialects. Globally oriented bankers are a rare breed. They think internationally and act locally. Fast banking growth days are over. Yet; a promising future is upon us! West meets East. Hopefully; hard lessons were learned! M. Hannoush-B.Sc.-MBA-Montreal-HNW Fin'l C'ltant-Int'l Arab Corporate Banking-Japanese Mgt-Mrktg-PR-IR

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