How much has Exane BNP Paribas paid to lure that team from Credit Suisse?
Exane BNP's extraction of five banking analysts and two sales traders from Credit Suisse, is causing some excitement.
"This is a huge coup for Exane," says one equities headhunter. "Hiring this team is a big statement to the market about their intentions. Some of these people are top ranked analysts and they would each have been expecting 600-800k as a bonus at Credit Suisse. Exane must have offered big money to get them to move at this time of year."
Exane BNP definitely has deep pockets. Last month, the Financial Times quoted people 'familiar with the bank's plans' who said it has at least €50m to expand its equities platform and that this could rise.
Altogether, the FT said it wants to hire 100 equity researchers and 50 people in sales and trading.
Exane BNP appears to have made the hires from Credit Suisse without the intervention of headhunters. Given the size of the team, the insertion of a search firm into the process could have cost it 1m in fees.
There's speculation that Exane must have offered a package guaranteeing the new hires' bonuses for 2011 as well as 2010. As a leading equities house, Credit Suisse is generally seen as having a stronger platform, with higher earning potential.
However, another prominent equities headhunter says there's more to Exane than just high pay. The partnership structure is a lure. So too, possibly, is the potentiality for working in Paris (Guillaume Tiberghien is French).
And then there may be push factors at Credit Suisse.
"The real issue is what this says about CS," says the headhunter. "They've lost their number one banking team. It's staggering that they would have allowed them to walk out the door."
In the third quarter, Credit Suisse was one of only three leading banks (the others being Morgan Stanley and UBS) to experience a quarterly decline in its clean equities trading revenues according to analysts at Nomura.
As we've noted, Credit Suisse's cost income ratio has also risen unhealthily high. As banking analysts, maybe Tiberghien et al's departure is really an indictment of problems at their former employer.
