If you've always wanted to get into a risk management job in financial services, the years 2008-2011 were probably the time to do it.
Yesterday, James Gorman, CEO of Morgan Stanley made a presentation pointing out that Morgan Stanley has doubled its risk headcount over the past four years. It has also achieved the following new and complex structure to keep an eye on risk across the organisation (click to enlarge).
However, the days of big risk hiring appear to have passed. Right now, Morgan Stanley is advertising 18 risk jobs globally. Only 5 are in London. This does not look like an area in growth mode.
Risk recruiters confirm that the big risk hiring appears to be over. Last year, organisations like RBS were reportedly hiring hundreds of risk managers. This year, with sales and trading revenues (still) weak, risk hiring has fallen by the wayside. RBS appears to be advertising fewer than 10 risk roles in what was once known as Global Bank and Markets (its investment bank). Recruiters claim some of the risk managers hired into RBS's investment bank last year have been transferred into other business areas.
Nevertheless, if you're determined to work in risk management, there is a pocket of continued hiring: we understand there's big demand for individuals who can put together so-called 'IMM Waivers' under new Basel III rules relating to counterparty credit risk.
IMM waivers require banks to put together detailed internal models on counterparty risks and to present these to the FSA with detailed explanations of exposures, how the bank has assessed itself, and various explanations of its approach to counterparty risk management.
Priya Mariannie at recruitment firm Elgin White, says this is where all the risk hiring appears to be right now. Banks are keen on recruiting quantitative risk specialists who can challenge existing models and know how to manage the process with the regulator, she says. Ideally, they will have strong relationships with the FSA. The right people can do very well, commanding six figures (sterling). "This is a very lucrative area to be in," Mariannie informs us.