The reasonably lucrative tech roles around CVA trading

We've alluded to the hotness of counterparty valuation adjustment (CVA) traders on previous occasions, but banks are also recruiting technologists and quantitative analysts to build and improve trading systems in this area.

For the uninitiated, CVA desks are an internal function within most investment banks, which aim to aggregate counterparty risk across the organisation, centralise it and then hedge against it - usually by purchasing related CDSs.

Most US investment banks have had these functions for a while - hence Zerohedge's (fairly old) blog about how the CVA desk stopped a big AIG blow up at Goldman - but a number of European firms have been playing catch up, largely because of new Basel III capital rules related to CVA.

These desks also create something of technological challenge. As a recent white paper by financial tech software vendor Global Market Solutions suggests, implementing a CVA desk requires "many different teams including IT (for designing efficient real-time interfaces)" and "IT quant (for implementing efficient models)".

In the UK, it's mostly European banks that are recruiting technologists and quant developers to either improve or create IT systems for CVA desks, suggests Anthony Besant, manager in the IT banking team at Hudson.

"Some banks have been focusing on this area a lot over the last year, and technology teams have increased from 3-4 man operations to 40-50-strong in some cases," he says. "It's still a fairly niche skill-set, despite the fact that these systems are usually based around Java, it requires cross-asset class knowledge, and European banks therefore usually recruit people from US institutions who have prior experience in this area."

Relatively speaking, these technology roles pay well. A business analyst working on a CVA desk project can expect anywhere between 80-110k, but even developers can earn up to 110k, suggest recruiters. There's also a lot of contract work, particularly for quant developers, and day rates come in at 750-800.

"Banks have placed a lot of emphasis on CVA projects, which means even if the job market is volatile elsewhere, these roles are still signed off," adds Besant.