UK
Cast your mind back, and you may remember the struggles of Liberum Capital – the boutique investment bank born on the cusp of the financial crisis in September 2007 – and the issues it faced last year keeping star analysts away from the grips of high-paying bulge brackets.
This year, it’s already taken steps to address this, having increased its salary cap from 100k to 150k and rolled out a quarterly performance-based cash bonus and equity scheme.
The first half of this year has been rather successful for the boutique bank, having reported revenues of 20m – a 64% increase on the same period in 2009.
But, looking at the (ever loved) average payout per employee last year, it’s not difficult to see why staff would have been lured across to the larger players.
It employed an average of 108 staff at the end of 2009, paying 164.6k per head in wages and salaries. Of course, this was unlikely to be spread evenly – 78 staff were in the front office, while 24 were employed in back office and support roles. Liberum also had six directors.
By comparison, Goldman paid an average of $498k (318k) and JP Morgan shelled out $379k (242k) per head.
But with compensation likely to be down at the bigger players last year, boutiques like Liberum could be more appealing.
Certainly, it’s managed to attract staff across from the larger players this year. Most recently, Naresh Chouhan joined as a pharma analyst from JP Morgan earlier this month. Pablo Zuanic also switched from the US bank to cover European large cap consumer staples.
In January, Peter Hyde joined as head of research from Credit Suisse.
Liberum also tapped JP Morgan Casenove for its new convertibles desk, having hired Simon Smith to lead the team and Peter Turner and Richard Tomblin for trading and sales roles respectively.
The bank has also come good on its claims that it was still hiring.
In the last two months alone, it’s taken on Paul Beumont and Mark Widdowson for sales trading roles, Simon Warrener for its execution team and Ash Lazenby as an analyst for mining, resources and energy.
This year its research team has also been bolstered by Daniel Horwood, Ben Bourne, Alexia Dogani and Mark James.
It currently employs around 130 people in London and New York.
Sad state of affairs when Liberum Capital becomes a ray of hope…..pathetic!!
Inaccurate, or at least misleading. Some of the people noted above that Liberum “managed to attract staff across from the larger players this year” had already been let go by their previous firms and were looking for ‘homes’.
Goldman payed avg of $498k and JP $379K. Whats the avg of front office.
doesn’t sound very appealing to me – 164k vs 318k and 242k at the big boys. pablo didn’t switch from jpm, he’d already been let go, as had some of the others. why would someone voluntarily leave jpm to go to somewhere paying less and where’s there’s no partnership?
Liberum has lost some real talent over the past 12 months.
liberum is full of had beens…..fossils basically….ppl who shud be in teaching rather than banking….i know a few of them
Sounds like they picked up some people who were let go in the meltdown, now the big boys are back and paying twice what liberum generates per head. Any one half decent will leave as 164k is far from what lead analysts get paid at most places. From what i hear Liberum has been a revolving door over the last year with quality analysts leaving and being replaced by people who’d been let go elsewhere or weren’t even in the industry and fancied a go at being an analyst! sounds like a joke to me.
seems like a one trick pony……. ex out all the mining stuff and I wonder what you’ve got left?
Zuanic is a reseach stud, the man is a machine. I have followed his work since he covered Latin beverages and later US food stocks, and always rate him hightly. His work last year on Cadbury Kraft was peerless. The guy is a thought leader, JPM lost 2 star consumer analysts this year, Zuanic and Vazquez. Liberum are lucky to have gotten Zuanic into their partnership.
Anyone with any background in the industry beyond VP level would know the draw of Liberum. Bearing in mind its only in its second full year of trading its done remarkably well. And it’s progression is expected to pick up even more. Also, its staff owned and the 164.4 is pre-bonus. Once profit had been shared out the difference is much closer.
More inaccurate comment. Liberum is in its 3rd full year of trading.
That’s odd, how can 164.4k be a pre bonus salary figure if there is a salary cap at 150k?? sounds like its total average compensation to me. Also the GS/JPM figures are total compensation EX shareholder dividends, big bank employees own a lot of stock once they’re VP / MD grade which accumulates over the years and pays quarterly dividends, its not just Liberum where staff own some shares.
good point, wingnut. Especially seeing as first mention I can see of rise to 150K max base was early May 2010 (see URL below) so most staff were on 100K max base for 2009. http://www.efinancialnews.com/story/2010-05-06/liberum-raises-salary-cap-by-half
In the current economic moment, why can’t you just be happy for Liberum’s achievement. Shame on those Sour Grapes. Get a life!
What exactly do you know about the “current economic moment” JD? Do any of these bankers do much good for the economy? i doubt the low income workers or the millions of unemployed in the UK would think Liberum’s “achievement” as you put it does them a lot of good. And don’t tell me it generates some tax revenue because it doesn’t – if Liberum didn’t exist its revenues would be going through the books of JPM or whoever and they’d pay the same tax on that revenue…so all its existence does is keep an extra 108 people in work, so some potential unemployment benefit savings i suppose.
Student – Leeds Uni, 2nd year
JD – no need to get personal on here, calm down. Everyone is entitled to a view as long as its sensible and most are just expressing an opinion on the facts in the article. If i was at JPM i’d have a right to be annoyed, the article suggests people are leaving there to go to boutiques, which isn’t the case as far as i’m aware – everyone in the City knows the JPM/Caz merger led to a lot of redundancies in equities as teams overlapped. So to say “its managed to attract staff from the larger players this year” and then citing JPM examples straight after, is potentially misleading. And its fairly obvious 164.4 isn’t excl bonus coz it says clearly that basic was 100k in 2009, so they’re not paying better than JPM or Goldman. Don’t shoot the messenger old boy. Over and out…wingnut
Lmao that someone (JD) could be urging people to get a life at about 6am on a Saturday morning.
These posts seem comical. The bottomline is that Liberum is a very good lean shop with highly experienced/connected staff. The pay mentioned is for its second full year as its currently in it’s third year (so will be published in 2011). No the 164K is not excl bonus But top earners there are not taking bonuses, just equity and their normal salary. Also the figures are misleading Liberum had backoffice staff to help setup/grow. While average front office Liberum took more than average JPM, star JPM >>>> Star Liberum, but this might change in the next 3-10 years. To end, their staff incl MD and Heads of deparments from BB. Though some staff were let go by BB, the vast majority were indeed poached. So lets give credit where credit is due.
As for the Leeds student. Yes they can be replaced but, unlike BB who focus on large cap, they focus on small and mid cap firms.
http://www.mynewsdesk.com/uk/view/pressrelease/liberum-capital-liberum-capital-continues-expansion-in-small-mid-caps-385509
I can see the attraction of Liberum – equity in a growing company, and quarterly CASH bonus. Sounds pretty good to me!
Agreed. Don’t understand why people have an issue with them. The people they employ seem very impressive (former partners, ex-heads and MD). Their growth seems very good too. Am I missing something or are people talking out their backsides?
You’re very likely missing something, JoeBlue
Ah another A-level student. Great. So grommit, please inform us.
Wow, calm down JoeBlue! Stop getting so worked up. You already know that Liberum Capital is a good place and everywhere else I have read seems to agree. So relax! No one does/should take posts too seriously. I mean just looking at the names of those who slander versus those with some goof view of Liberum says it all.