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Oops, is Bear Stearns doing it again?

In 2000 Bear Stearns built up massively in Europe just as the cycle was about to turn. Sound familiar?

In January this year, Financial News claimed Bear Stearns had big plans to triple the number of staff it has in London, hiring as many as 2,000 people in the process. The US bank has subsequently revealed plans to move to a new, larger headquarters in Canary Wharf and has hired for everything from credit to prime broking and M&A. It’s also opened an office in Paris, and has another in the pipeline in Frankfurt.

But is now the time to be engaged in all this hiring and office-opening activity? The Bear brand’s looking more than a little lacklustre following its association with the crisis in two of its US sub-prime mortgage-focused hedge funds. Its co-president Warren Spector was ousted over the weekend, its stock has fallen around 20% since June (says the FT) and talk of a takeover is in the air.

Combine this with the bank’s failed history of European expansion, and anyone joining now may be justifiably dubious. After it hired vigorously in M&A in 2000, more than half Bear’s team was shown the door between 2001 and 2003. One headhunter (who’s worked with the bank) predicts the same will happen again: “Is it really committed to Europe? I don’t think so; it will hire and then fire. But other banks will do the same.”

To induce people to join it now, headhunters say Bear Stearns will need to offer some tasty pay packages. Fortunately, it seems the bank isn’t averse to this. “Frankly, I don’t think they’ll have trouble hiring,” says the headhunter. “Their set-up is a bit like Lehman used to be – it’s low cost and high commission. They’re a lean, mean bunch of guys and they pay well.”

“At the end of the day, Bear Stearns can be hard to hire for in Europe because they’re a bit of an also-ran,” says another headhunter who’s dabbled in recruiting for the bank in the past. “But at this stage in the cycle they might get people who want to get locked in.”

Comments (15)

  1. anybody joining these cowboys better make sure he’ll get a hefty pay check guaranteed. They’ll drop you like a hot potato as soon as the cycle turns. If however you enjoy swimming with sharks and don’t mind explaining to your clients what exactly makes Bear different (nothing!) to other houses and why they should do biz with Bear, then you’ll have a great time!

  2. I would doubt whether this international expansion will actually take place. it would be costly and the pay-off would not come for at least a couple of years. Right now, Bear needs to conserve cash.

  3. A bunch of sharks. They deserved to blow up

  4. I know someone who joined BS a couple of months back got a fat package and was promoted from associate to director. stick your guts out and join the bears.

  5. i had an interview with them recently, and the management was ok, but the junior stuff i met was dissapointing. they said they are looking to expand and have a new building ready soon but for me they looked like they dont know what they want.

  6. The Bear story in Europe now is very different to 2000. There’s a new management team in place and Bear is building in areas where it’s already got proven strength; rates, credit, ABS, structured equity etc. And its growth is paying for itself – Bear’s Europe and Asia business made 20% of global revenue in Q2, up from 13% in 06. The headhunter who commented that Bear is not committed to Europe is simply out of touch.

  7. It makes me laugh that headhunters want to get long term lock in’s, hmmm must be forcing up the fees. I see lot’s of people from Bear applying to my roles, so it can’t be that happy a place. Would I recommend someone joining them, it depends on their appetite for risk vs reward. Not a place for the faint hearted!!

  8. As an independent, working for a reputable recruitment business, I would say that in my expereince, BS are actually a pretty conservative bunch of professionals with high levels of integrity. A trait not likely to be shared by “bearhunter”.

    There are plenty of other firms on the street who sail closer to the wind, no doubt some of these are bearhunters clients.

    The European end of BS’s business actually has some pretty good USPs if you are in the job market at the moment.

    From the tone of Bearhunter’s comments I’m guessing the only cowboy here is him. Perhaps it’s time to power down the old home pc, close the study door and put the box on … neighbours will be on soon ;-)

  9. Did you mean he joined as an associate and was promoted to director in 2 months??? IS it really the case?

  10. The most diabolical place to work – i have known several friends / acquaintances to work there – all agree the place is full of sharks and will never break its fiefdom approach – sophistication is something it will neve rhave – go there and stall your career

    Does a Bear …? Reply
  11. Many comments here from headhunters that really do not know the deal at BS. Its not called BS for nothing. It really has few USPs. I know,during my time there and was told directly how few by many clients in the UK.Its a place that talks a great deal based on its US model but is not being replicated in the UK expansion.It will be a boom/bust scenario and if it suits take the money and roll with it otherwise look elsewhere. And as for ‘Bearing up’,his comments about them being conservative are plainly wrong. KYC !

    just you wait for some of their recent top hires to leave as they dont want to associated with a leaky ship, the rest will fall just like it has done at other Tier 2 houses.

  12. Personally I think their a bunch of Sharks… Had an interview with them recently… Offered a position, only for it to be retracted an hour later. The Senior Management look and sound completely disorganised. They have no idea what they want nor where they want to go!!

    Bear in Name, Bear in nature Reply
  13. Obviously a few disgruntled punters out there ! Can we all try harder with the Bear based nick names please ….

    Bear Faced Liar Reply
  14. “Personally I think their a bunch of Sharks…”

    They probably rejected you for your inability to distinguish between “their” and “they’re”

  15. I have had a few occassionsd to deal with BS in one shape or another, each time left with the oppinion that they are unprofessional and somewhat up their own backsides..

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