The hiring spree for equity researchers within international banks in the Gulf may have tailed off towards the end of 2008, but as firms look to gain ground in new markets and sectors demand for analysts is taking off again.

The likes of UBS and Deutsche Bank were actively building equity research teams in the Gulf towards the tail end of 2008 before the financial crisis hit. Since then, employment prospects in the sector have been decidedly thin on the ground.

However, this is changing. Bank of America Merrill Lynch has doubled its regional research team, RBS signed up to a joint venture with Rasmala Investment Bank to cover MENA equity research in February, EFG-Hermes has a research capability in its new Jeddah office and Arqaam Capital has unveiled a new Beirut-based research division.

“The opportunity to expand our team further, ensuring that we remain at the forefront of the Middle East’s investment banking industry, is one that we are aggressively pursuing,” said Riad Meliti, chief executive officer of Arqaam Capital. They intend to double the size of the research division by the end of next year, he adds.

The likes of HSBC, Morgan Stanley, Deutsche Bank and Saudi firm Al Rajhi Capital are all thought to be selectively hiring.

“A lot of international firms are building research capabilities on the ground in the Gulf, while local banks are realising the importance of good equity researchers as they prepare for a swell in IPOs, particularly in places like Saudi,” says Matthew Lewis, managing director of Correlate Search in Dubai.

Again, much of the new work appears to be coming out of Saudi Arabia, which means equity analysts with a deep understanding of local markets, combined with Arabic language skills are being highly sought after.

“The bulge bracket banks are building new offices in Saudi Arabia, which need to be staffed by equity researchers,” adds Omar Taha, managing director of headhunters S&T Group. “There were so many layoffs in this sector after 2008, but even though this is non-revenue generating, banks realise that equity researchers are essential in gaining new capital and a competitive advantage.”

One senior equity researcher in a large Dubai-based investment bank, who declined to be named, is in no doubt about the increased demand in this sector.

“Regional exposure and Arabic language skills are integral to any equity research team. Very few banks are willing to take the time needed to train or to allow new recruits to get up to speed,” he says.