Boutique investment advisers are picking up the slack as overseas i-banks continue to take heat from the credit crunch.
Lazard Carnegie Wylie, which recently announced that it almost trebled its profits in the last half of 2007, is leading the way (Business Spectator).
Victoria Biggs, from Jon Michel Executive Search, says tough times often provide local operations with access to quality candidates as the big boys take a breather. “Every time global firms go into meltdown, local firms step in to pick up the talent. I have seen increased activity from the local boutiques; they are probably finding it easier to attract talent than they would be in an environment where everybody is looking for talent,” she adds.
Biggs says while the niche firms offer similar base salaries to the global players, bonuses might be discounted. A level-three VP at a boutique can expect a total salary/bonus package of around AU$800k, compared with AU$1m at a foreign firm.
Mary Grant, Hudson’s banking and finance division principal consultant, says those who shift to smaller firms often jump back after several years. Grant says the boutiques might offer a good wage plus equity in the business, but “people are saying they would rather have the cash”.
While boutique firms are enjoying talent wins, Katherine Woodthorpe, chief executive of the Australian Private Equity & Venture Capital Association, says the credit crisis isn’t all doom for global players. “Australia has been relatively insulated and PE clients are still busy doing deals. Most people will continue using the advisers they have learnt to trust,” she advises.