Prime broking recruitment is heating up. And prime broking sales staff are the hottest of the lot.

Today, the Financial Times reports that Citigroup has hired 13 hedge fund servicing staff out of BarCap and Morgan Stanley. Deutsche has also declared its intention of expanding its prime broking business in Asia.

A proliferation of new prime broking players, combined with hedge funds’ desire to develop relationships with more than just one bank, has meant competition for clients is fiercer than ever. As a result, good sales staff within the sector are increasingly in demand.

The prime broking landscape has changed markedly over the last 18 months. We’ve moved from a situation where Morgan Stanley and Goldman Sachs had two-third of the market to themselves, to one where an increased number of major players are fending off competition from so-called mid and mini-primes.

Six major prime brokers – JPMorgan, Goldman Sachs, Morgan Stanley, Credit Suisse, Deutsche Bank and Citigroup – still hog 76% of the market, according to a recent report from Aite Group, but new players are “shifting firmly into the growth phase, where their main goal is to increase sales and become the provider of choice for prospective clients”.

“There is clearly an increased demand for sales staff and business originators across the board,” says Ron Suber, senior partner, head of global sales at prime brokerage services firm Merlin Securities.

“There’s a business opportunity here and now for custody, trading, finance and prime broking changes. Firms need to bring the right people on board to take advantage of this opportunity while it exists.”

Citi has indicated its desire to grow headcount within prime broking, Barclays intends to recruit 12 in London this year, HSBC continues to grow its (relatively) new prime services division and JPMorgan also intends to recruit in this space.

“A number of banks are recruiting sales staff at director level and above who have access to decision makers within the hedge funds,” says Andrew Morland who focuses on prime broking recruitment at Pelham International. “Sales teams in London were cut in half at the height of the crisis, and firms now have to ensure they have the manpower to win new mandates.”