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Way, way back in March, stung by criticism of its handling of Northern Rock, the FSA declared its intention to up its intake of former bankers, including quant types to work on its frontline supervision teams, focusing “on the complex models used by banks to gauge financial risk” (FT). Its timing was impeccable. With thousands of banking employees subsequently let go and Lehman’s entire risk, compliance and trading teams on... Read more

Never has the cost of lax risk control been more stark. From $7.1bn of losses at SocGen to huge writedowns at the likes of UBS and Merrill Lynch, banks have learnt the hard way what it means not to keep a firm grip on their employees and businesses. As a result, we are seeing strong growth in compliance roles with a ‘monitoring’ element to them, for example trade survelliance and... Read more

To the ‘big swinging dicks’ hauling in the revenues on the trading floor, it might seem obvious that they’re paid more than the bank's back-office staff. But a new report suggests this imbalance is unfair and should be rectified. A wide-reaching 176-page study by the Counterparty Risk Management Policy Group – whose members include Goldman Sachs, HSBC and Morgan Stanley – says that the contribution operations and risk management staff make... Read more

Recruitment firm PSD Group has produced its annual salary and bonus survey, the long and short of which is…compliance salaries in investment banks are up 5-10% on last year and 2007 bonuses were the same or slightly higher than in 2006. The figures are: Compliance analyst: 1-3 yrs' experience, salary £35k-£40k, bonus 5-10% Compliance associate: 2-5 yrs' experience, salary £40k-£50k salary, bonus 10-15% Compliance manager: 4-7 yrs’ experience, £55k-£75k... Read more

Investment bankers with a legal background can be forgiven for eyeing their former employers with a certain wistfulness: banks’ business is evaporating, but law firms are still going strong. Freshfields, for example, posted a 40% increase in profits per partner last week. Unsurprisingly, some of the lawyers who opted for banking careers are now thinking of retracing their steps. “There’s a definite trend for people who are working as lawyers in... Read more

If you’re hoping to reinvent yourself as a restructuring professional come the M&A apocalypse, you could be out of luck. Instead of washed up M&A bankers, it seems restructuring businesses are interested in hiring lawyers with insolvency backgrounds. The last to do so was UBS, which recruited Matthew French from Lovells back in March, thereby following in the footsteps of Goldman, which hired Andrew Wilkinson from Cadwalader Wickersham & Taft... Read more

Spending on compliance is supposed to double by 2010. Does this mean banks are indulging in a frenzy of compliance hiring? Sadly not. Instead, it seems the emphasis is on either shifting people into compliance from other roles internally, or trying to make do until times improve. “The volume of roles is very similar to 2007 levels, however certain investment banks are offering roles to internal candidates more... Read more

Lambasted over its Northern Rock shortcomings, the FSA needs to hire lots more people. Trouble is, it can’t keep hold of those it’s already got. The true extent of the FSA’s Northern Rock-related ignominy will become apparent tomorrow when it unveils the results of an internal review of its shortcomings. All indications are that review will come clean on the regulator’s ‘mistakes’ and pave the way for a hiring spree. The... Read more

US law firms have begun setting up sub-prime litigation teams. The same phenomenon may be about to happen here. It's been on the horizon ever since investors started losing out on mortgage-related bonds, and sub-prime litigation is finally banging down the door. Barclays is sueing Bear Stearns over the collapse of two hedge funds. Goldman and Morgan Stanley, plus assorted other Wall Street firms, are said to be the targets of... Read more

Pay’s not great, but anti-money laundering is high on intrigue, immune to downturns, and allows its officers to battle terrorists without joining the armed forces. Thanks to new Money Laundering Regulations (MLRs) that come into effect on 15 December 2007, demand for anti-money laundering (AML) professionals may be about to increase. The new regulations extend AML obligations to the likes of car dealers and money service businesses such as FX dealers and... Read more

Which banks and bankers are suffering the most? No prizes for guessing… ACUTE PAIN 1. Merrill Lynch Share price: down 44% since January 2007. Bonus per head*: $181.3k, down 25% on 2006. Net profit for the first nine months of 2007: $1.9bn, down 61%. Redundancies: none announced so far, but exit of chief exec Stan O’Neal is imminent. 2. Bear Stearns Share price: down 38% since January 2007. Bonus per head*: $407.6k, down 20% on 2006. Net... Read more

Spare a thought for the classes of 2007 and 2008. It seems investment banking jobs are proving hard to come by. A student at a leading European business school says banks are still coming to present on campus, but that with the exception of Credit Suisse, few appear to have any full-time places left for 2008: “Places have already been filled by last year’s summer interns. If you missed the boat... Read more

Most people sit around passively waiting for the pink slip. Has Stan O’Neal gone for pre-emptive action? Ever since Merrill revealed a $2.3bn 3Q net loss earlier this week, there have been calls for Stan to step aside. Now the New York Times says Stan’s head has moved closer to the block after he allegedly broached a merger with Charlotte-based Wachovia without first getting the approval of Merrill’s board. Putting aside the... Read more

Rising taxes and falling returns are taking their toll on the co-investing craze. “The amended capital gains tax rules will impact people participating in company co-investment schemes that qualify for business taper relief,” says Chris Sanger, head of tax policy at Ernst & Young. “Assets disposed of before 6 April 2008 will be taxed at 10%, while those disposed of from 7 April 2008 will be taxed at 18%.” Co-investing is nothing... Read more

Temporary contractors are said to be on track for £200k per annum as the City scrambles to get ready for MiFID. A survey by City recruiter Joslin Rowe claims that soaring demand for temporary Markets in Financial Instruments (MiFID) specialists has allowed the best workers to command up to £800 a day. MiFID, legislation aimed at providing a single jurisdiction for securities products, comes into effect on 1 November and financial firms... Read more