Yes, there WILL be front office hiring in the second half. And here's where it will happen
As we noted a few weeks ago, we are at that time of year when banks start to get cold feet about hiring.
Financial News makes a similar point today: after a frantic two months of recruitment post the lifting-of-the-bonus-tax, it says banks like Credit Suisse, Deutsche, Goldman Sachs and Morgan Stanley are now 'wrapping up' their recruitment for this year in an effort to preserve their bonus pools.
Really? One senior Deutsche Banker tells us hiring is continuing as normal, the front office included, and that, "volumes will remain constant" in the second half.
Regardless of what's going on at Deutsche, it seems unlikely that front office hiring will totally switch off for the rest of 2009. After the past few months' recruitment activity, headhunters point out that there are plenty of gaps to fill. "Banks can't just leave them for 8 or 9 months until next year," says one.
Here's where the gaps are:
1) BNP Paribas
As the Financial Times noted last week, BNP is overhauling its European investment banking business and has, "an ambitious growth plan in Europe," which may lead to hires.
More immediately, however, BNP has got a big, big problem in its rates business, where it's already lost 10 or 11 people, and is thought to be in danger of losing even more.
"They're desperate to hire," says one headhunter. Another says BNP also has big plans in commodities and is expected to hire there in the second half.
2) Barclays Capital
BarCap is expected to hire in equities, having lost some of its Italian team to Citigroup. According to one M&A headhunter, it's also said to be one of the remaining big hirers in M&A, although volumes are expected to drop off in the second half.
3) Citigroup
Citi needs to hire in M&A to replace its decimated TMT team.
4) Deutsche Bank
Contrary to the rumours of a hiring freeze, on fixed income headhunter says Deutsche still has, "loads of holes to fill."
This includes the big hole left by Kevin Arnold and others, who left Deutsche's rates business for UBS, as well as various other departures.
One headhunter points to Deutsche's alleged poaching of Garry Naughton, a senior government bond trader at Goldman last week, as evidence of the German bank's ongoing enthusiasm, for hiring. "This was a big, multi-million pound hire," she adds.
5) Goldman Sachs
Goldman doesn't usually offer guarantees, which should mean it's able to continue hiring cost effectively in the second half. However, it's also not a particularly big lateral hirer, so don't necessarily expect much in the way of activity.
One equities headhunter says Goldman needs to hire in equity research where it has reputedly lost people and is allegedly left with a comparatively junior team.
6) Nomura
Nomura is expected to continue hiring across fixed income sales in the second half, with some trading hires also anticipated.
7) UBS
UBS has hired, "an enormous number" of people in fixed income during the first half of the year, and continues to hire according to one headhunter.
Commodities headhunters are also waiting to see what happens in their area. UBS pulled back from commodities in 2008, but recently hired Kaushik Amin, former boss of RBS Sempra Commodities, leading to speculation that it might build a commodities business again.
8) SocGen
Until last Friday, things were looking quite promising for hiring at SocGen. The bank was said to intend recruiting another nine M&A bankers in Europe this year, and in May it said that it intended to make 600-1,200 hires across the investment bank in 2010, with a focus on fixed income.
However, following rumours on Friday of a big derivatives-related loss at SocGen, there are fears among headhunters that hiring plans might be put on hold.
9) Others
Aside from the institutions listed above, headhunters say the following organisations are also going to be recruiting between now and December: HSBC (equities), Macquarie (equities and M&A), RBC (more rates hire expected), Jefferies (ongoing opportunistic hiring).
