Investment Banks Lure Back Job Candidates with Double Pay

Investment banking firms that shed jobs in a hurry last year, and lost scores of others to high-level defections, are now finding they have to “up the ante” to fill the gaps in their ranks.

That’s the word from BusinessWeek who report that both Bank of America Corp. and UBS AG are doubling base salaries to lure bankers from competitors. UBS, for example, is offering managing directors base pay as high as 300,000 pounds ($470,000), double the amount of last May.

Many firms lost senior talent when the government slapped restrictions on compensation for firms receiving bail-out funds. But both UBS and Merrill Lynch have paid back their government loans and are now free to set compensation as they see fit.

The article quotes John Purcell, managing director of London- based executive search firm Purcell & Co. as saying, “In the world of investment banking, it’s a simple case of who pays wins. Institutions that are fairly directly under political control are facing significant difficulties retaining staff.”

Of course, many banks are raising salaries while cutting back on bonuses in order to placate the public backlash against banker’s compensation. Bonuses paid by UBS reported dropped 71 percent in 2009. Higher salaries are being used to retain top workers who’ve had to deal with pay cuts or freezes over the past 18 months.

Bank of America is reportedly on the hunt to replace three dozen senior investment bankers who quit the firm after its takeover of Merrill Lynch.

UBS is recruiting investment banking job candidates on base pay only, according to Jason Kennedy, CEO of the London-based recruiting firm, Kennedy Associates. “Target candidates … have been ex-UBS employees and other candidates who in the past moved from the bulge-bracket firms to the small broker dealers and now want to move back to the larger firms,” Kennedy said.

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{ 1 comment }

Ira Goldstein February 23, 2010 at 9:30 am

I managed the listed options department for Advest, a regional brokerage firm that was taken over by Merrill Lynch, which eventually got taken over itself.
I would love to get back into Wall Street and help another brokerage firm with my vast knowledge and expertise.

Thank you.

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