Banks are haemorrhaging leveraged finance pros to private equity funds – and raiding project finance teams for substitutes.

The latest high-profile move is the departure of Chris Gammons, a leveraged finance specialist at Deutsche Bank, who is reportedly moving to Citi in a principal investment role. Other recent moves in the space include Eric Mason of JPMorgan moving to Carlyle and Jason Poon, a VP at Merrill Lynch in the credit and illiquid risk solutions group, who has also left for the buyside.

“Demand for leveraged finance bankers is currently extremely high,” says Phil Pemberton of executive search firm Sheffield Haworth in Hong Kong.

“For project finance pros, it’s a different experience working on a principal platform, putting equity into deals as well as organising funding for their clients. But project financiers have the modelling skills. Perhaps even more importantly, they have the industry contacts,” says Pemberton.

It’s a bonanza for project finance specialists, however, who are currently paid around half what their colleagues in leveraged finance are paid, according to Christopher Lewis, an independent recruitment specialist in Hong Kong.

Lewis estimates that an associate in leveraged finance takes home US$400k to US$600k, while a vice president would get up to US$500k to US$1m and a managing director between US$1m and US$2m.

It’s difficult to estimate what top earners in private equity funds earn because the payout is longer term.

However, one recruiter says: “Essentially the sky’s the limit. Some guys out there (working for hedge funds) are being paid US$50m.”