Bank by bank, these are the new hiring priorities for 2018
Want to get hired by a major bank now? This is where top firms have indicated they will be hiring (and firing) in the months to come.
Bank of America: Adding staff in Dublin. Still hiring, "client-facing professionals to further strengthen local market coverage," in the U.S. Still spending on technology everywhere.
If you work for Bank of America, Dublin is flavour of the moment. After selecting Dublin as its European base after Brexit, Bank of America moved former CFO Bruce Thompson to Ireland to run its new EU hub in September 2017. Thompson is now busily building his management team: he named eight new executives, including George Carp, a veteran MD in global banking and markets to leadership roles this week. Thomson subsquently plans to shift 125 people from London to Dublin starting from July. Any BofA London people who turn him down will reportedly be, "considered for suitable alternative employment, failing which they may be made redundant.” Even so, it's unlikely they'll all go, and therefore likely that Thompson will need to fill some Dublin gaps with people hired externally.
If you don't want to work for BofA in Dublin, you could always work for BofA in Dallas. Like Goldman Sachs, the bank has a policy of investing in "local bankers for local markets" which it says it's still pursuing. It's also hiking spending on technology and may well be inclined to invest in equities sales and trading professionals after revenues in the equities division rose 38% year-on-year in the first quarter.
Barclays: Hiring has slowed, but senior staff are still being added - particularly in U.S. equities. Still investing in technology. Still "reallocating capital and balance sheet more productively."
There's bad news and good news at Barclays. The bad news - if you were hoping to join in a senior position - is that the British bank says the rebuild of its markets leadership team is now complete. The good news is that Barclays still seems to be hiring just the same (despite making 100 directors and managing directors in its investment bank redundant in January). In the U.S. it's already added four managing directors in equity research this year (David Strauss on aerospace, Steve Valiquette on healthcare, Julian Mitchell on industrials, Eric Beaumont on power and utilities). In the UK, it's hired Emmanuel Cau as head of European equity strategy. Five senior hires are not exactly on a par with the 40 MDs who were hired in to the banking and markets division last year, but nor are they to be dismissed out of hand.
The new recruits are the work of Stephen Dainton, the ex-Credit Suisse banker who now manages Barclays' global equities business. Equities isn't Barclays' only area of focus though. Technology remains an area of focus and the bank says it's particularly, "addressing relative under-investment in electronic trading capabilities." Last month, CEO Jes Staley said Barclays is only halfway through the "reengineering" of its electronic trading platforms, which has so far focused on rates and FX, with more work on equities to come.
The U.S. equity derivatives platform is being rebuilt after staff exits in 2017. And Barclays is allocating an extra £10bn of risk weighted assets to high return trading businesses which will increase its return on equity. Last September, investment bank CEO Jes Staley said Barclays planned to focus on prime, equities, and credit.
BNP Paribas: Still pursuing a ~5% CAGR in the corporate and investment bank, still automating everything and investing in compliance and controls
BNP Paribas has some big plans for its corporate and investment bank (CIB). Under, "Strategy 2020" it's pursuing a ~5% CAGR in its global markets business between now and 2020. Unfortunately, this didn't go entirely to plan during the first quarter of 2018, when fixed income currencies and commodities (FICC) revenues fell 31% and equities revenues fell 20% year-on-year. Nonetheless, the French bank insisted that things are going to plan and said the U.S. business, where it's been making big hires like Jason Yang as head of credit structuring, did well.
BNP continues to "reinforce its internal control systems" (something which led to heavy hiring in the past). It's also automating processes and embarking upon a "digital transformation" with a view to making €1.1bn of cumulative, recurring cost savings across the bank this year, €1.8bn next year and €2.7bn in 2020 - of which a third are expected to come from the CIB. During the bank's most recent investor call, CFO Lars Machenil, said BNP is in the process of automating, "200 processes and the implementation of three so-called end-to-end projects," involving, "credit processes, ForEx cash, and client onboarding." Expect hiring in technology and digital re-engineering, therefore.
Citi: Still hiring selectively in equities and maybe macro trading. "Re-engineering" support functions
The story at Citi remains one of a steady built-out in equities sales and trading. The U.S. bank has been hiring under global head of equities Murray Roos for several years and has latterly been hiring for its equity derivatives business. In March, for example, it added Michela Ferrulli from Bank of America Merrill Lynch as head of equities sales and sales trading for Central & Eastern Europe, Middle East and Africa (CEEMA). This followed last year's addition of Christophe Pochartt from BNP Paribas as head of North American equity derivative sales, plus various cash execution appointments.
During Citi's first quarter investor call, CEO Michael Corbat praised the strength of the bank's equities division, which he said performed strongly across, "cash, derivatives, delta one, and prime finance" in the quarter. Citi CFO John Gerspach said the bank is particularly keen on its macro trading division, which is highly oriented towards corporate customers and therefore inured against poor trading volumes during times of low volatility, when institutional clients sit on the sidelines.
It's not all about growth at Citi though. Gerspach said previously that Citi intends to “reengineer global functions” like compliance, finance and risk this year. Citi previously said that it wants to shave 70 basis points off expenses in the investment bank by moving staff to low cost locations.
Credit Suisse: Nearly finished restructuring, pretty much finished hiring in equities. Still cutting contractors, keen on anyone who can cross-sell to private banking clients
Credit Suisse has also been building out its equities division under Mike Stewart, the global head of equities it hired from UBS at the end of 2016, who aspires for the Swiss bank to achieve a top five position in equities trading globally. During the Swiss bank's first quarter call, CEO Tidjane Thiam said CS had been investing in equities talent and "refreshed the franchise" in its equity derivatives business.
Unfortunately, all this hiring has been expensive.- Results for Credit Suisse's London operation, which break out P&L by business, show the equity derivatives business made a loss of $76m in 2017. This, together with Credit Suisse's comparatively poor performance in equities in the first quarter (like-for-like revenues rose 7% compared to 30%+ at rivals) help explain various statements from Thiam to the effect that CS has finished hiring in equities for the moment and is now awaiting results.
While equities staff step up (hopefully), Credit Suisse is still restructuring. Thiam said the bank is now nine quarters through its 12 quarter restructuring process and plans to accelerate the changes this year. Cutting contractor numbers and external vendors remains core to Credit Suisse's cost cutting initiative: in the past two years, the bank has gone from 20,000 external vendors to just 10,000. At its investor day in November, CS said it’s shifting jobs out of high cost locations (think London) to low cost “business delivery centres” (think Wroclaw), automating compliance jobs, and investing in artificial intelligence. Up to 45% of compliance and control headcount is set to be eliminated through “process re-engineering“ and “digitalization.”
The best place to work at Credit Suisse now is probably the "ITS" division - a joint venture between global markets, global wealth management, and the Swiss Universal Bank. ITS sells global markets products to private wealth management clients and is growing particularly strongly. It is also Thiam's pet project.
Deutsche Bank: Gaps to fill in macro trading, potential to strengthen European corporate finance, cutting in the U.S. and Asia
Deutsche Bank is, needless to say, undergoing a period of change under its new CEO who has promised vigorous cost cutting in the corporate and investment bank alongside hiring in some key areas.
The most obvious hiring need at Deutsche Bank is in European macro trading. Here, the German bank has holes at the top following the departure of Sam Wisnia for hedge fund Eisler Capital, along with his deputy Kal El-Wahab. These gaps may yet be filled, given that European macro is one of the areas Sewing has said he wants to strengthen. Sewing also stated his intention of orienting the bank towards German and European corporate finance clients, suggesting the potential for hiring senior relationship managers in Europe. At the same time, existing relationship managers who focus exclusively on U.S.and Asian clients look exposed. - The bank's Houston office has already been closed and the global oil and gas team let go,
Deutsche has already begun cutting at its U.S, business where there are rumours that 20% of staff could go. The worse place to work at DB now looks like U.S. equities, which is under review and could be pared back significantly. DB is also exiting U.S, repo trading and moving some staff to London. Like Credit Suisse, Deutsche is cutting back on IT contractors, partly by turning them into employees: 1,400 contractors were "internalized" last year.
Goldman Sachs: Strats hiring. Hiring local bankers who can build relationships with corporates
Goldman Sachs is all about hiring "strats" - or its own particular brand of quant. When CEO Lloyd Blankfein discussed the firm's hiring intentions in February, he emphasized its appetite for both strats and engineers to build and maintain the technology which runs the bank. There is a particular focus on quants and engineers who can help develop Goldman's electronic equities trading system as it seeks to catch up with Morgan Stanley. The firm has been focusing particularly on Marquee, the pet project of CFO Marty Chavez, which will make the SecDB risk and pricing database accessible to clients. 60 Marquee jobs were being advertised as recently as April.
At the same time, Goldman continues to pursue the strategy outlined by former COO Harvey Schwartz last year, and to chase new clients, particularly in the corporate sector. During the first quarter call, Chavez said Goldman has "assigned coverage" on only 500 of its 1,000 new targeted clients so far, and that its already made some senior banker hires to facilitate this. The bank also continues to spend and hire lavishly in technology and Chavez called out cyber-security as a particular areas of focus.
J.P. Morgan: Technology hiring. Hiring in Asia. Selective senior banker hiring
All banks spend on technology, but J.P. Morgan's tech spending is off the charts. The U.S. bank says it will spend $10.8bn on tech this year, up from $9.5bn last year, of which $5bn will go on new projects. JPM already employs 50k technologists, but wants more. Digital transformation looks like a good place to be: it's at the heart of J.P.M's ambitions and there are currently just 2,500 people on that team. J.P. is open to hiring technologists from outside finance: Daniel Pinto, chief executive of the corporate and investment bank, noted that 30% of J.P. Morgan's 2017 tech hires didn't have a banking background. Nonetheless, J.P. Morgan has a proven appetite for very senior technologists from other banks.
Away from technology, Pinto has intimated that J.P. Morgan could hire in Asian fixed income, emerging markets macro, and municipal finance. During the bank's investor day, CEO Jamie Dimon said J.P. Morgan also wants to hire senior bankers in "targeted areas"
Morgan Stanley: Just the right size, less need of voice traders than before
Morgan Stanley's sales and trading miracle fell a bit flat in the first quarter, when it was out-performed by Goldman Sachs. This might be one reason why CEO James Gorman said the bank's sales and trading business is "appropriately sized." CFO Jonathan Pruzan noted the bank's diminishing need for voice traders as electronic trading takes over - although applies to all banks, not just Morgan Stanley.
UBS: Big hiring in Asian and U.S. wealth management. Some hiring in U.S. M&A, some cuts in EMEA fixed income
UBS's big hiring focus is not its investment bank: it's the private bank in Asia, where 40 new relationship managers were added in the first three months of this year alone. It's not just Asia: during the bank's first quarter investor call, CEO Sergio Ermotti emphasized his intention of expanding the bank's U.S. wealth management business too.
If Asian private banking is not your thing, UBS has also indicated its intention of adding new M&A bankers in the U.S. (although you'll need to be prepared to attend a huge number of mandatory client meetings as UBS tries to make its investment bankers more productive). Less promisingly, UBS has been trimming in EMEA fixed income (specifically, its government bond desk). However, it says it's investing in electronic equities execution.
Like most banks. UBS is also ramping up its technology spend and cutting contractors whilst bringing tech jobs in-house.
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