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In the current climate, few firms are talking up expansion plans, which is why Russian investment bank VTB Capital’s international recruitment drive – including big plans for the Middle East – is garnering a lot of attention.

Last year, VTB Capital hired 25 front office investment bankers for its overseas operation and has plans to recruit a similar number for the next two years.

We highlighted back in October that VTB was eyeing an expansion in the Middle East.

Last week, it unveiled Makram Abboud – most recently head of emerging markets at Nomura – as its new chief executive for the Middle East and Africa. It’s also believed to have hired five people from Credit Suisse’s Dubai-based equities team – including Karim Nsouli, head of MENA equity sales trading and Ali Salaam, co-head of MENA equities.

It’s the latter which is raising a few eyebrows locally. After all, equity trading volumes have been declining across the Middle East for some time, brokerages are closing at a rate of knots and most international investment banks have pulled senior equity-focused employees out of the region, or just downsized their teams.

VTB Capital appears to be banking on the hope that Saudi Arabia’s equity markets – currently closed to direct foreign investment – could open up this year.

Atanas Bostiandjiev, chief executive of VTB’s international investment banking unit, told Euromoney: “We’re taking a view that Saudi Arabia could loosen restrictions against foreigners taking direct foreign investments.”

It’s also tempting to conclude, as is often the case with smaller investment banks poaching talent from larger firms, that VTB Capital is prepared to dig deep for its new hires.

To some extent this is true; headhunters in Dubai suggest that VTB Capital is offering one-year guaranteed bonuses to new recruits that can be as large as $800k for director level hires. “No one else is even considering guarantees currently,” says the headhunter.

However, in the case of the new Credit Suisse hires, VTB may simply have been the beneficiary of market conditions. Sources have told us that members of Credit Suisse’s equity team were given an ultimatum of relocating to London, or face redundancy. In order to stay in Dubai, they accepted a role at VTB, suggest our sources.

This year, VTB Capital is looking to recruit more investment bankers in London to originate deals in Central and Eastern Europe outside Russia, says Euromoney, as well as coverage bankers in sub-Saharan African markets, including Angola, Ghana and Nigeria.

Most of VTB’s focus will be intermediating deals between Russia and other emerging markets, but in the Gulf, investment bankers will attempt to originate mandates unrelated to Russia.