What was hot in 2009?

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Needless to say, if you have an interest in financial services jobs, 2009 has been a year of two very different halves. The first half was overshadowed by redundancies and the traumas of late 2008. In the second half, the dark clouds parted and all was surprisingly benign.

In our opinion, the sun shone particularly strongly over the the past 12 months on...

1) Fixed income currencies and commodities professionals

There's little denying that 2009 was exceptional for anyone even vaguely involved in FICC. For an example of just how exceptional, consider the fact that in the first nine months of the year, FICC revenues at Goldman Sachs rose 172% on 2008.

The so-called, 'flow monsters' of Goldman, JP Morgan, Deutsche, Credit Suisse, and Barclays Capital made the most of the FICC party.

Non-flow beasts such as Morgan Stanley and UBS did less well and looked enviously at their monstrous rivals. This prompted Morgan Stanley to announce plans for 400 sales and trading hires in August. By late October, its hiring programme was 50% complete.

UBS, meanwhile, also unveiled ambitious plans for increasing its fixed income revenues, and made 200 FICC hires between January and November.

Within FICC, rates desks had a particularly big 2009. At Deutsche, for example, rates went from 20% of global markets revenues in 2007 to 30% this year. Jefferies expanded its European rates team with various hires and BofA Merrill Lynch was rumoured to hire Vinit Sahni from Goldman as European head of rates sales in the last quarter.

2) High frequency traders

2009 was also the year when high frequency trading moved out of the shadows and into the media. The Financial Times, cited claims that it accounts for 70% of all daily US equity trading, up from 30% 'a few years ago.'

By mid-April it was becoming apparent that there was plenty of high frequency hiring, with banks moving in on a space traditionally occupied by hedge funds like Citadel. And by July, the importance of high frequency trading to some banks' revenues was highlighted by Goldman Sachs' determination to chase former employee Sergey Aleynikov through the courts for allegedly stealing some of its high frequency trading code.

Aleynikov's fate isn't entirely clear, but as far as we can make out, he is currently unemployed. Goldman's determination to hunt him down unleashed various accusations that it might be using its high frequency operations for nefarious ends and frontrunning its clients, all strenuously denied by the bank.

3) Todd Edgar et al

2009 was also a wonderful year for a group of JP Morgan commodity traders who happened to get picked up by BarCap.

In August, Edgar and his colleagues left JP Morgan and joined Barclays Capital to head up the banks' FX desk.

Edgar et al were reportedly offered a combined $25m in salaries and bonus, plus a 15% profit share, all of which will escape the UK government's bonus tax.

4) Regulation and employment lawyers

2009 was also very good if you happened to be a lawyer specialised in financial services regulation, particularly regulation pertaining to pay and hiring. From the G20's various bonus stipulations to the British government's interpretation of them, the FSA's evolving Remuneration Code of Practice, the contents of the UK Financial Services Bill, and the UK government's bonus tax, regulatory lawyers had plenty to keep themselves busy.

Employment lawyers also had a frenetic time. Demand for their services rose 77% in the first nine months.

5) Boutiques

2009 saw an explosion in the number of boutiques of all hues, but particularly boutiques with a fixed income complexion. Yorkvik Partners, Chalkhill Partners, and Stormharbour are just a few of those to have been conceived over the past 12 months.

As we noted just the other day, various of these boutiques are hiring.

6) High yield professionals

Given the degree of risk aversion permeating the market at the start of the year, who would have thought high yield professionals would have made a comeback? Surprisingly, however, this is precisely what happened.

Low interest rates and uncertainty over the equities rally spurred investor demand for high yield bonds, while difficulties accessing bank loans drove European corporates to seek funding through the high yield market.

As a result, global high yield debt issuance soared to $170bn in the year to mid-December, up from $49bn in 2008 according to Dealogic.

 

Hiring went similarly haywire, with UBS, Bank of America, Calyon and HSBC all adding senior high yield staff.

7) Salaries

2009 was a good year for fixed pay. With bonuses being curtailed (see 4), banks opted to hike basic pay instead. By December, Barclays Capital, Citigroup, UBS, BofA Merrill Lynch, Credit Suisse had all heaved salaries higher by as much as 100% for senior staff.

Some (BarCap and Citigroup) even contemplated backdating the increases to June, thereby assuring employees of something very closely resembling a bonus in December. However, fears that this could contravene theanti-avoidance clauses related to the bonus tax may have put a stop to this.

8) Cash equities

In June we were derided for suggesting that cash equities hiring was, 'hotter than at any time in living memory.'

In retrospect, this may well have been the case. Barclays Capital, Nomura, Citigroup, Execution and ICAP were among those pushing into cash equities sales, trading and research last year.

2010 may see the arrival of Evercore, which is also contemplating building a cash equities business - albeit only in the US to begin with.

9) Barclays Capital

2009 was the year in which Barclays Capital went for growth. According to Financial News, it made at least 25 hires in investment banking over the year.

BarCap hired more enthusiastically in equities, where it hired 450 people between autumn 2008 and May 2009 according to the Financial Times.

In August, Bob Diamond said BarCap's big build was 75-80% complete, with most additional hiring to come in Asia. However, rumour has it BarCap intends to hire large numbers of technologists in the first half of next year.

10) Banker bashing

2009 was the year in which bankers came to be blamed for all the world's woes. This created difficult conundrums, such as 'Should I sell my house to a banker?', never easy to solve at the best of times.

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