Banks want overseas talent for push into India

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Financial services recruitment may be blazing ahead in London and on Wall Street, but the hiring rush in established financial centres is outweighed by the recruitment furore currently hitting India.

"Investment banking recruitment has hit an explosive phase," says Ronesh Puri, managing director of the New Delhi office of search firm Executive Access. "Everyone is expanding, and there are lots of banks moving in. There is huge demand for i-bankers right now, at every level."

It is a view shared by rival search consultant Sunit Mehra at the Mumbai office of search firm Hunt Partners. "This is clearly one of the best years in the history of the country for investment banking and private equity hiring," says Mehra. He adds: "Hiring is happening across all levels and across all banks, with no exception."

Both Mehra and Puri declined to say precisely which organisations are aboard the recruitment bandwagon. But it's possible to make an educated guess: in recent weeks and months Goldman Sachs has committed to build a wholly onshore owned Indian investment bank, Credit Suisse has said it's building an onshore trading organisation, JP Morgan Chase & Co. has declared an intention to grow its Indian staff by a further 4,000 and JP Morgan Asset Management has revealed plans to launch an Indian mutual fund business.

Institutional Investor recently reported that private equity funds like the Blackstone Group and Kohlberg Kravis Roberts are expanding in the country. So too are hedge funds: US fund Chapman Capital recently announced plans to open an office in Mumbai.

"Our lateral hiring in India has gone through the roof," muses a recruiter at one global investment bank.

What makes the Indian phenomenon of more than vicarious interest to bankers in Europe and Wall Street is the fact that the country appears to be drawing in people from overseas. On one hand, banks may be outsourcing low value jobs to India, but on the other, recruiters say the country is hungry for international talent.

"There's a war for talent," says Puri. "Organisations are not averse to taking ex-pats, as long as they are excited about working with India. A lot of the work here is global in nature."

Pay on par, goes further

It may be hard to get excited about the prospect of working in a developing country, where pay is bound to be lower than it is the West. But guess what -Indian recruiters say banks there pay internationally competitive rates.

Puri says a managing director in Indian M&A can earn a $200,000 base salary, plus a 300% bonus. Muri puts it even higher, with base pay ranging from $300,000 to $500,000. Over the past year, he says bonuses have risen from 50% to 150% of base salaries, to between 100% and 300%.

With star bankers in London and Wall Street earning as much as $10m, pay in New Delhi doesn't quite compare, but given the cost of living is around five times lower, India's bankers aren't doing too badly either.

For the future, banks in the country are making an effort to nurture talent in-house rather than buying in expensive lateral hires. In 2005, 40% of graduates at the Indian Institute of Management went into investment banking, compared to 12% in 2004 and 14% in 2003. Last year, banks like Barclays Capital, UBS and DSP Merrill Lynch, a joint venture between DSP Financial Consultants and Merrill Lynch, recruited in the country for the first time.

With a flood of new juniors on the cards, experienced bankers interested in gaining a foothold in India may therefore want to do so sooner than later.