WHERE THERE IS DEFINITELY STILL HIRING CURRENTLY: Delta One

We touched upon the relative hotness of investment banks' Delta One desks a few months ago, but in a world where front office hiring has drastically retracted, it remains an area of recruitment. More cash equity traders and sales traders are eyeing a switch across.

Recruitment sources suggest that the likes of Citigroup, BoA Merrill Lynch, Deutsche Bank, Citigroup, JP Morgan and UBS are all looking to bolster their Delta One desks, even if some are cutting back in other areas of the business.

Delta One desks deal with flow equity derivatives that closely track the underlying asset and include equity swaps and exchange traded funds (ETFs). They've graduated from a little known corner of most banks' trading operations to a key driver of profits. Financial News reported this month that a number of investment banks (BNP Paribas, Citigroup and Goldman), had highlighted them as a positive in their interim results.

"Delta One desks have become a key pillar of revenues in most investment banks, and there's a healthy pipeline of recruitment," says Nader Bawany, who heads up the equities desk at Fairway Search Partners. "More sales traders and traders are also learning about the product area as they see it as way to increase their employability."

Bawany primarily recruits for director level hires, and says that banks are offering base salaries of 120-250k, a figure that increased over the last year in line with banks' focus on fixed pay.

"Most banks are recruiting for Delta One, but finding a supply of talent remains challenging," adds Justin Willis, director of financial services recruiters Bright Purple.

For cash equity traders, the switch into Delta One - where the derivatives have no optionality - is easier than thinking about moving into structured products, says Bawany.

"Quite simply, banks want multi-skilled sales traders and traders in the current climate," he says. "Recruitment of pure cash equity specialists is ebbing away."

For all the positivity, it's worth pointing out that McKinsey's report into the prospects for investment banking wasn't great for flow equity derivative products. It was anticipating a 65% decline on return on equity within the business as it battles with additional credit valuation adjustment (CVA) charges from the shift to central clearing in the post-Basel III environment.