RBS isn’t the only bank cutting in equities. We understand that Morgan Stanley’s job cuts have begun and that various of its senior equities professionals are being let go, including some of the heads of its equities business areas in London. BNP Paribas is said to be trimming its equities professionals too.
So, what hope is there for the newly redundant equities person?
Right now: not much.
“People who are let go should really consider whether they want to get back into the industry,” says the equities-focused head of one search firm. “If everyone wants to remain in banking, the reality will be that salaries will fall dramatically and everyone should be prepared for that.
Failing that, “People should shamelessly network with their clients but not expect anything in the short term,” he adds.
”At this point, it’s all about compensation,” says another equities consultant. “Until compensation has been finalized, firms will not commit to hiring.”
Nevertheless, it’s not all bad.
Headhunters say there are some very good people at RBS, such as the banks research team led by Ian Smillie, and that RBS equities bankers who move for base only have a reasonable chance of finding a new role elsewhere. “If they’re moving for base, they’re a cheap option and competitors will look at them,” predicts one, optimistically.
More concretely, a small ‘full service investment bank,’ Dinosaur Securities, has popped up and decided it wants to double headcount in London this year.
“We have 20 people in Londoncurrently, 70 in New Yorkand 25 associates in Sao Paulo/Miami/Bermuda,” says managing director Paul Becker. “We’re looking to increase headcount by say another 20 in London, possibly 30 in New York and, say, 3 in Switzerland, and 5 throughout Continental Europe as associates,” he informs us.
What kind of new recruits is Becker looking for? He postulates a 50% headcount increase in sales/brokerage people of any asset classes, a 25% increase in investment bankers, and a 25% increase in wealth managers/private bankers, but says “nothing is written in stone.”
“We would like to speak to any individuals or teams at RBS, or anywhere else for that matter,” Becker concludes.
Don’t all rush at once.