It's that time of year. While banks are busy making appointments to next year's analyst classes, they're also busy cutting from this year's analyst and associate pools. When you have 223,000 people applying for junior jobs every year (as Goldman Sachs does), you can afford to take your pick of the best and brightest new graduates and cull a few of your existing juniors who've proven anything less than excellent in their roles.
London recruiters who deal with junior M&A staff say it's more a question of who hasn't cut analysts and associates from investment banking divisions (IBD) in the past few weeks than who has. Credit Suisse, HSBC, RBC, Barclays and UBS are all said to have done some trimming already. Juniors at Goldman Sachs, Deutsche, and maybe even some of the Big Four accounting firms are said to be next in line.
"Cuts are being made here and there," says the head of one recruitment firm working with juniors in London. "Banks are managing performance very aggressively in this last quarter."
"You're going to see a lot more layoffs in M&A before the end of the year," says Andy Pringle at recruitment firm Circle Square. "Banks want to get their headcount numbers down."
Anyone let go in London now will struggle to find a new job. In comparatively quiet year for M&A, banks' attention is on next year's analyst hires rather than adding experienced juniors who've been let go by competitors.
This being the case, some of those let go might be inclined to explore opportunities overseas. In Frankfurt, Goldman Sachs just hired Henrik Jansen, an analyst from Credit Suisse, converting him to associate in the process. PWC just hired Florian Protschky from BNP Paribas for 'global deals origination,' and boutique advisory firm GCA Altium just hired Wali Mahmood from Berenberg for its German office.
German investment banking revenues were down 36% year-on-year in the first nine months of this year according to Dealogic, but this doesn't seem to be dissuading firms from hiring. Logan Naidu of recruitment firm Dartmouth Partners says their German office is busy. Even so, Pringle says few London-based juniors want to move to Frankfurt (even if they're German): "You have U.S. banks with teams of 600 people in London and 30 in Germany. People can see that you'll get no exposure there."