After a torrid 2009 for Ireland’s financial services industry, it’s still slightly difficult to see a light at the end of the tunnel. However, here’s our considered opinion on which sectors will fare better than others next year.

2010 could be a good year for:

Fund administration:

Arguably one of the largest employers within Ireland’s financial services industry, fund administration has shifted from recruitment frenzy to hiring freeze over the last 18 months.

However, in the latter part of 2009, there were some signs that firms were open to recruitment once again, and this is set to continue into 2010.

“Firms are looking to increase their headcount due to new fund launches from existing and new clients over the last few months,” says Robin Craig, director of recruiters Careers Compass.

Fintan Lawler, banking and financial services consultant at Hudson in Ireland adds: “Expansion plans by some of the larger large fund houses that were put on hold last year have now been given the go ahead for 2010.”

Corporate restructuring:

Most developed nations now claim that their economies are at least on the road to recovery, but sadly the same cannot be said for Ireland. In 2010, the government is still predicting a 1.25% contraction, following a year when the economy already shrank by 7.5%.

But for some financial services professionals, grim economic conditions present an opportunity. Companies falling into trouble will require expertise to restructure debt obligations, and recruiters expect this to form part of financial services firms’ hiring plans for 2010.

“We expect strong demand for staff with experience in corporate recovery, debt restructuring at mid to senior level across banking, practice and legal area due to natural pressures of current climate and the onset of NAMA,” says Andrea Clarkson, manager, financial services at Premier Group in Dublin.

Risk management:

Just how long risk managers’ elevated status within financial services firms can last is debatable, but regulatory pressures are likely to keep recruitment strong going into 2010.

“We will continue to see a growth in the demand for quantitatively driven risk analytics professionals within both international located in Ireland and indigenous banks,” says James Hayes, manager – banking and financial services at Robert Walters. “These will be recruited to develop more robust and sophisticated risk management tools. We will see this within the commercial, corporate lending areas and also across retail banking.”

“These departments have become paramount in maintaining the reputations of financial institutions and this trend is likely to continue this year,” adds Lawler.

And 2010 could be a bad year for:

Retail banking:

The creation of a long-mooted ‘third force’ in Ireland’s banking sector – possibly consisting of a mergers between Educational Building Society (EBS) and Irish Nationwide Building Society, or Irish Life & Permanent and Bank of Scotland (Ireland) – appears to be getting closer to reality.

If this happens, it will inevitably lead to some fall out at the branch level. This, combined with possible redundancies within Ireland’s two major banks, paints a bleak picture for retail bankers in 2010.

“Costs will have to be taken out, and unfortunately I would expect redundancy plans at some stage,” says Oliver Gilvarry, head of research at Dolmen Securities.

“With consolidation expected, we see a net decrease in the number of retail banking staff in Ireland,” says Eoin Blake, head of banking and financial services at Lincoln Search & Selection.

Wealth management:

Irish high net worth individuals certainly like investing in property. According to a recent study by Barclays Wealth Irish investors typically have 52% of their investments in the sector (compared to a 28% average), and their portfolios have slumped by 20% or more over the last 2 years.

Suggestions from HSBC Private Bank, show that just 1-2% of wealth in Ireland is made of ‘old money’. This means entrepreneurial wealthy investors have been particularly badly affected by the Celtic Tiger implosion, and it’s easy to see why the wealth management sector has been suffering.

“The wealth management sector is likely to continue to endure a challenging 2010 due to the reduced availability of investable assets as high net worth clients continuing to exercise caution,” says Hayes.

Commercial lending:

The fact that the risky lending practices of Irish banks have come back to haunt them is, of course, no secret and commercial bankers have suffered in 2009. Many have been laid off, others have been transferred across to administer existing loans – either way it’s not a particularly attractive place to work. Sadly, this could continue.

“There is still significant unease regarding the Irish property market, which has made the banks extremely cautious about lending any for large scale projects and also most potential buyers are waiting to see what effect NAMA will have on prices,” says Lawler.

“A succession of banks have indicated further redundancies in 2010, these functions we expect will be badly hit,” adds Craig.