If things turn nasty, it may be better to be based in Europe than in the US.

According to headhunters (and our own reckoning), there are a few reasons why European jobs are likely to prove a little more resilient if banks start wielding the hatchet.

Big guns

Top of the queue is the fact that big banks have been shifting resources to Europe in an effort to make the most of growth opportunities here. Witness Goldman Sachs, which shifted chief administrative officer Edward Frost to London last February; or Morgan Stanley, which moved management of its global M&A business to Europe in July, citing the “tremendous success and financial stature of Europe both within Morgan Stanley and in the global marketplace as a whole.” Last month a report from Bank of America Securities highlighted the plans by Merrill Lynch, Morgan Stanley, Bear Stearns, Lehman Brothers and UBS to continue growing in Europe – in Italy and Germany in particular. Bear Stearns is predicting, perhaps optimistically, that it will double its European fixed-income revenues in the next four years.

Faster growth

In the second quarter at least, many banks saw European revenues and profits grow at a rate which outpaced the US. According to Financial News, for example, revenues at Goldman Sachs’ and JPMorgan’s international divisions grew at a faster rate than those in the US during the first half of this year. In February, Merrill Lynch predicted it could make around 75% of its investment banking revenues outside the US within five years.

Efficient teams

There’s also the fact that in M&A in particular, teams in the US are still considerably larger than in Europe, despite the fact that fees here are about the same (European M&A fees are US$6.2bn for the year to date according to Dealogic, while US fees are US$6.6bn). “An industrials team in the US might be 80 people strong,” says the head of one international search firm. “In Europe, it might be 40% that size.” If you were looking to make cuts, which would you choose?

But it depends upon where you work

Despite Europe’s plus points, the global financial services head of another international search firm says European job security will really vary from bank to bank. “There are two types of US bank – those that understand the global markets and Europe as a region, and those that don’t,” he says. “The first know it’s as difficult – if not more difficult – to hire good staff in Europe and Asia, and will burden their US offices with redundancies first. The second are more likely to drop international teams and divisions because they don’t understand the value they bring.”

Who falls into the first camp? He suggests the likes of Merrill Lynch, Morgan Stanley, Citi and JPMorgan. The second camp is apparently populated by US-centric operations such as Wachovia, Bear Stearns and Bank of America. Bank of America, for example, is thought to have invested several hundred million dollars growing in Europe, but has yet to make much of an impact on the region’s league tables. “Bank of America makes pretty small profits in Europe versus the costs of the operation,” says the global head. “Without proper engagement of senior staff, the danger is that bankers in Europe will show up as little more than dispensable blips on an Excel spreadsheet.”