The TRADE 57 | Page 46

[ I N D E P T H | TA L E N T ] T he new battleground for investment banks has swiftly become that of attracting and retaining the best talent the industry has to offer and it’s something of an open secret that poaching the best people direct from competitors is often the best tactic. Take Citigroup for example; the US investment bank has recorded a strong performance for H1 2018, with equities up 19% in Q2 compared to the year prior. This could, in part, be attributed to Citi’s strategic moves to strengthen its equities team in recent years, all of which has led to the bank’s structural overhaul in early September as part of its long-term strategy. Citi’s efforts have come at a direct cost to its com- petitors. The bank has made a string of hires from its rival Bank of America Merrill Lynch (BAML) this year “If you are building out a business segment or trading desk, of course you are going to want people that you can absolutely trust, and naturally you gravitate towards those you have worked with previously.” OLIVER ROLFE, FOUNDER AND CEO, SPARTAN EXECUTIVE alone, with equities specialists and sales staff swap- ping their allegiance across North America, Europe, the Middle East and Africa. Poaching one member of staff from a rival firm can often turn into a full-on raid, according to Oliver Rolfe, founder and CEO of a global executive search firm Spartan Executive, which specialises in global cash equities talent searches for major banks. “There are many, many examples of the fight for talent that we are seeing in the industry at the mo- ment,” Rolfe says. “One financial institution will hire a senior individual in a management role from a major competitor, and shortly afterward, he or she will bring some of their former colleagues to the new team. It makes sense. “If you are building out a business segment or trad- ing desk, of course you are going to want people that you can absolutely trust, and naturally you gravitate towards those you have worked with previously. People who will be honest with you, tell what the situ- ation is, whether good or bad, and that are more likely to provide you with the guidance that you need.” 46 // TheTrade // Autumn 2018 The fight for talent isn’t just playing out in New York though, with European banks also jostling for a position on the frontline. Credit Suisse has suffered from a targeted offensive from its London counterpart Barclays. Over the past year, Barclays has appointed a global head of equities, a global head of electronic equities, a head of equities derivatives trading and a head of equities for Asia-Pacific, all from Credit Suisse. Thinning the ranks Institutions such as Barclays and Citi, that have targeted talent at competitor firms, are fairly open about this strategy as internal memos are often sent to various de- partments detailing how poaching talent from competitors is a process that banks are firmly committed to – although no banks were willing to speak on-record for this feature. While the process is undoubtedly complex and will involve a substan- tial legal element when it comes to compliance sign-off, the fruitful results cannot be argued with. Not only does this approach swell the ranks of the banks’ own teams, but it also weakens the competition, a factor that shouldn’t be taken lightly as increasing regulatory pressures continue to squeeze profits, which in turn leads to more severe cost-cutting measures just to maintain margins. More often than not, headcount is the first thing to be slashed when major institutions face a dreaded restructure to reduce these escalat- ing costs. “In a MiFID II world, and during the years prior, especially after the crash, the hierarchy has changed significantly,” Rolfe adds. “In terms of workforce, the global financial