There aren't many organisations placing themselves above the parapet and admitting they might build in London next year. StormHarbour is therefore an exception.
Fresh from hiring Amir Hoveyda, a veteran Merrill Lynch FIG banker in September, Stormharbour plans to expand its presence in Old Burlington Street in 2012. This is what COO Terry Keeley told us about its intentions.
Q: Can you quantify the extent to which StormHarbour's grown in recent years?
Terry: Of course. We're a very dynamic business which has continued to grow impressively all over the world since inception. For instance, we started with less than 20 people in New York and London at the beginning of 2009, and today we have around 200 professionals working across New York, London, Copenhagen, Singapore, Hong Kong and Tokyo. Gaining critical scale and establishing an international network of offices in the world's main financial centres was a core objective of the firm from the very beginning.
Q: The business environment has obviously been, 'challenging.' Has this impacted the areas you're focused on?
Terry: To some extent, yes, although there are very few firms which haven't been impacted. While the firm hit some headwinds in high yield and leveraged loan sales and trading, we have been well positioned in flow structured credit, and particularly in advising clients on regulatory capital - ostensibly advising banks on all matters related to current and forthcoming regulatory bank capital requirements - and their legacy asset portfolios, areas in which we have established a name for ourselves as a trusted adviser and pricing agent. To be clear, the firm has been impacted on some level by the challenging market environment but we have navigated the conditions well and have not had to materially adjust our growth strategy this year. Indeed, we have been hiring right across each business and region we operate in.
Q: StormHarbour has traditionally been seen as a debt-focused advisory firm. Is this an accurate portrait of where you are now?
To be seen as 'debt-focused advisory firm' is not an accurate reflection of our true capability today. StormHarbour's core businesses are sales and trading, structuring and advisory, capital markets and asset management. We describe the firm as an 'independent global markets and financial advisory firm' because we are not only active across global markets - as a result of our global network of offices and specialist teams who engage in cross-border origination, sales, structuring and trading activities in debt, derivatives and equity products - but also provide specialist financial advisory services to investor and issuer clients. It's true to say that we are predominantly fixed income focused, and credit, particularly complex structured credit, is very much a part of our DNA but our collective experience and expertise enable us to work right across the product spectrum and capital base. For example, we were recently mandated to place the equity and mezzanine tranches of Europe's first ever slate financing.
Q: Where do you expect growth to come from next year?
We would like to selectively add to our global capital markets team, particularly our coverage of liability management for the insurance industry. This is already happening to some extent in readiness for what we believe will be a growth area next year as insurers increasingly move into investments, such as infrastructure assets, as part of their liability management programmes. We're expecting this to be a vibrant area and would be interested in talking to professionals who have the required technical expertise and senior level relationships with insurance companies, some of whom are looking to put their own infrastructure teams in place.
Q: Are there other people you'd be interested in hiring?
Yes, absolutely. From inception, we consciously put together a global team that was more heavily weighted towards managing director-level professionals because we wanted them to already have meaningful, long-standing relationships with clients. However, this means that our team is underweight vice-president and associate-level professionals, so there is a natural need to fill those positions and in 2012 we plan to do just that.
Q: What kind of people do you hire?
StormHarbour has been formed as an investment banking partnership, so we have always looked for those who want to be part of a unique, entrepreneurial culture and those who have the ambition to play a part in helping to shape the future direction of the firm. They need to be client-focused and willing to make a difference too. Our culture does not suit those who expect business to come to them, and are happy to just sit there and trade off the firm's name. We look for those individuals who can originate new business by themselves, or as part of our team, and those who can sit in-front of clients and deliver ideas or solutions that will make them sit up and take notice.
Q: Do you hire from big banks?
Traditionally, yes, investment bankers are precisely the type of professional we're interested in but we have attracted people from other smaller capital markets and advisory firms as well, although their experience is typically rooted in bulge bracket banks. On the VP and associate level side, we're interested in those who have completed training at an investment bank, but we're also interested in hearing from MBA graduates and management consultants.