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Russian banking layoffs

Not a good time to be a Russian banker

The confirmation that Deutsche Bank is indeed ‘scaling back’ its Russian investment banking unit and making 200 of its 1,300 Moscow-based staff redundant marks the end of an era for Russian bankers. Not long ago, they were some of the most-sought after bankers in the world. Now they’re global pariahs.

“The people who are coming out of Deutsche are not going to find it easy,” says Taru Oksman-Ison, a director at search firm Riverhouse Partners. “Some of them might get picked up by Russian banks locally, but their options are going to be very limited as the market in Moscow has contracted a lot. Nor will they find it easy to move to London. Most banks in the City are streamlining and are already quite lean.”

It’s a big change from a few years ago when Russian banks like Rencap, VTB, and Troika Dialog (acquired by Sberbank) were building up both globally and locally, and international banks were rushing to start local Russian graduate recruitment programs.

“The Moscow story is starting to fade away. Many moons ago you couldn’t find enough Russian speakers to go around and banks literally had Russian teachers coming onto the trading floor to try and boost their Russian language skills,” says the director of one emerging market search firm in London, speaking on condition of anonymity.

Most of the London-based Russians have studied maths-based subjects at Russia’s top schools. The Moscow School of Economics was a popular recruiting ground for international banks looking for Russian excellence. So too was the St. Petersburg State University.

The search firm director says Russia’s top young bankers today are applying to Russian banks locally, or trying to get transferred to London. Until recently, this transfer strategy worked well. Last year, Goldman Sachs was shifting young IBD professionals from its Moscow office to London as it sought to fill holes in its M&A team.

However, as banks in London supplement their stock of analysts with new graduates from universities in the European Union, it will be harder for experienced young Russians to transfer to the City. It will also be harder for Russian graduates to get into finance in the first place. J.P. Morgan’s EMEA graduate recruitment team is touring the UK, Germany, Spain and Switzerland this autumn, but Moscow has dropped off the map.

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