BNP Paribas has embarked on an end of year poaching expedition for its prime brokerage sales team. One recruiter tells us it’s symptomatic of the state of the market.

“There’s been huge expansion in the prime brokerage business in the last 12-18 months, particularly prime brokerage sales,” says David Korn, managing partner at global search firm Options Group.

Goldman Sachs, Morgan Stanley, Credit Suisse, and UBS are among the leading prime brokers in Europe. Deutsche Bank has been boosting its prime brokerage capabilities globally this year and Jefferies is building in the US, while Barclays Capital, JP Morgan, Merrill Lynch, Bear Stearns and UBS are understood to have boosted their prime broker capabilities in Europe.

Korn says prime broker sales hiring is now largely complete for 2006, with most houses now doing their last key hires or putting things on hold until after bonus payouts.

However, he expects the market for sales staff to pick up again in 2007. And with Deutsche Bank for one likely to raid its rivals, PB sales staff could be on for generous bonuses in the interim.