If you want a new banking job in London this year, you'll need to be niche. As UBS reiterated many times during today's investor call, the environment is "tough" and the bank is "focused on costs," and UBS isn't the only one - Barclays has made it all but impossible to hire anyone in 2016.
Nonetheless, banks are hiring. Jes Staley reportedly intervened personally at Barclays to enable the recruitment of CS Venkatakrishnan from J.P. Morgan as the bank's head of risk. For the right person, in the right role, exceptions will be made.
One month into 2016, this is where recruiters say those exceptions are.
1. Regulatory knowledge
Hiring is still all about infrastructure and support roles. Take Deutsche Bank, which hired nearly 2,700 people into support and infrastructure roles last year, an increase of 15%.
Hakan Enver, operations director at Morgan McKinley in London, says regulatory-driven disciplines will continue to expand in 2016: "The growth in employment in regulatory driven disciplines, such as finance, compliance, risk management and internal audit, continues in response to the growing burden of regulations and diminished appetite for risk."
Regulatory expertise requires more than simply reading a few government websites. Enver says you need to be thoroughly, "up-to-date with regulation and source-books."
The importance of skills linked to regulation was underlined by Morgan Stanley's recent managing director promotions. The US bank promoted Frederick Barnfield, its US-based head of global regulatory reporting and Michael Harris, who's managing its fixed income valuation review in London. Morgan Stanley is currently on the hunt for two London-based co-heads of compliance for its markets business, reporting to the chief compliance officer for EMEA.
As we observed a few weeks ago, banks are also hiring people to help implement the Volcker Rule. Deutsche Bank, for example, is looking for 'Volcker risk' professionals in New York and London.
2. Technology skills linked to regulatory, risk and control initiatives
Regulatory change isn't just driving demand for compliance, risk and regulatory reporting professionals, it's also creating demand for technologists who can help banks handle regulatory processes.
Goldman Sachs, for example, is hiring a senior developer for its fixed income business to help prepare for the introduction of MiFID II in 2018. J.P. Morgan has created a new 'Liquidity Risk Infrastructure' programme and is hiring a 'big data developer for liquidity risk' to staff it.
3. Reporting and analysis skills combined with an accountancy qualification
Richard Johnson, manager for permanent finance hiring at Robert Walters, says 2016 will be a year of resurgent demand for accountants with around 5-7 years' experience working on reporting, accounting and/or analysis roles.
Johnson says reporting and analysis roles were neglected over the past few years as banks focused on compliance, risk and regulatory recruitment. As these areas 'mature', he predicts that banks will focus on hiring for other areas of finance in 2016, and that they'll need experienced individuals who are immediately up to speed.
4. Exceptional rates trading ability
2015 was a good year for rates traders, and as rates desks benefit from divergent global monetary policies, banks are expecting more of the same in 2016. Hiring is likely as a result - Deutsche Bank, for example, stressed its intention of growing its rates trading business this year.
However, given the number of rates traders on the market, banks are likely to be incredibly fussy about who they take on.
There are already instances of rates trading upgrading. Barclays, for example, just ousted its US head of rates, Michael Yarian.
5. Heavy execution expertise in IBD
If 2014 and 2015 were the years when banks staffed themselves with experienced analysts and associates, 2016 could be the year when hiring moves another notch up the hierarchy. Andy Pringle, chief executive of recruitment firm Circle Square, says much of the demand for analysts and associates is now coming from boutiques rather than banks. Joseph Leung, founder of search firm Aubreck Leung, says demand in IBD is now strongest at vice president (VP) level: "They want heavy lifters to do the execution work.”
6. Streamlining and offshoring
As banks seek to cut costs by taking out unnecessary infrastructure spending, 2016 will also be a year of demand for project managers and others with streamlining expertise.
Paul Kalo, manager for contract finance recruitment at Robert Walters in London, says there's already strong demand for 'project accountants' who can oversee banks' cost-cutting and reorganisation projects.
Separately, Morgan Stanley, which has promised to move thousands of jobs to lower cost locations this year, just promoted one of its Mumbai-based recruiters to managing director. Guess where the hiring will be in 2016?
7. Natural resources credit risk
Lastly, this is a year in which banks' exposures to oil companies could come home to roost. If you're a credit risk specialist with a focus on natural resources companies, this could be your lucky 12 months. J.P. Morgan is already on the lookout for a natural resources specialist to join its London credit risk team. Other banks can be expected to follow suite.
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