Bad news as Lehman graduates flood the market
Things weren't looking particularly great for students who want to go into investment banking even before Lehman Brothers exploded and Merrill got lapped up by Bank of America. Now they look a whole lot worse.
The main problem, in London at least, is that most (if not all) of the graduates hired by Lehman to start this summer are now back on the market. According to Bloomberg, 90-95 trainees who started a week ago have been dumped.
Waiting for confirmation
Lehman graduate recruiters are lying low, but one insider says people who were offered jobs as a result of the summer internship haven't been told yet whether they are defiinitely not wanted. This certainly looks like being the case in the bank's fixed income divisions, but Barclays has expressed an interest in parts of Lehman's cash equities business, so some may be given a reprieve (although this seems unlikely).
Students who went through Lehman's internship this year say hardly anyone was offered a full-time placement anyway: "Out of around 120 people, only 30-40 max got offers."
Meanwhile, Julia Barber, at recruitment firm Cornell Partnership, which runs graduate hiring schemes for smaller banks and boutiques, says she's already been approached by some Lehman-exs.
"We've seen quite a few people who graduated this year and have just come off the six-week Lehman training programme," says Barber. "They've had full investment banking training and were literally sitting at their desk for five minutes before they were asked to leave."
At this stage, it's still not totally clear what's going on with all last summer's interns who received offers at Merrill Lynch. Insiders say the bank will honour its offers and that Merrill is still recruiting summer interns for next year. However, recruiters say no one's had anything in writing as yet.
Appetite for Lehman exs elsewhere
Banks which still have places on their graduate schemes are said to be wooing Lehman refugees in an effort to fill them. UBS is said to be still hiring for a 2009 start (this is unconfirmed by the bank). Macquarie is also looking to hold its London graduate intake fairly steady in 2009.
So where does this leave recent graduates/people who'll graduate next summer?
The answer is, unfortunately, in a worse position than this time last week. "The market's completely saturated with Lehman employees," says one student, who failed to secure an internship. "I'm having to lower my standards and look for back-office work."
