Forget M&A, capital markets, or proprietary trading. The new, new thing in 2009 may well be the innately unglamorous area of transaction services.
Banks' transaction services or cash management teams help corporate customers manage their cashflow and liquidity requirements. The Financial Times last week pointed out that while most other areas of banking are struggling, cash management businesses still boast an annual growth rate of 10-25%.
Cash management professionals say revenue growth isn't the only thing driving banks' interest in the business.
"Managing cash for corporates brings liquidity into a bank," says Colin Hemsley, head of major corporate sales at LloydsTSB. "And that helps immensely when the cost of funding in the interbank market is so high."
Much of the data collection involved in cashflow management work is now automated, but companies still help interpreting the data when it comes in. Hemsley says offering this help has the added advantage of forging strong client relationships. "It gives you good visibility of what's going on, and in difficult times like this, that's a really good thing," he says.
All of this means that cash management teams are unlikely to shrink in 2009, and may well grow. "For many banks this is an area of focus. People and resources will be switching into it," predicts Hemsley.
From capital markets to cashflow?
So, what's the possibility of a down at heel investment banker reinventing himself as a cashflow specialist?
Hemsley's not so sure: "It's very, very different to capital markets and M&A," he says. "You need a really good understanding of how payment systems work, of the implications of the Single European Payments Area, and how the payment and account structures work all the way down a company's supply chain in order to optimize them."
However, Mark Cooper, head of UK cash management at SEB, says there could be openings for bankers with corporate relationships on the sales side of the business.
"Investment bankers could certainly reinvent themselves, but there would be cultural difficulties to overcome: selling cashflow management isn't exactly rocket science," he says.