Chicago Investment Banking: Competition Fierce

March 1, 2008

By Suzanna de Baca

As bulge bracket firms continue to announce layoffs, Chicago-area investment banking job openings are relatively few and competition is fierce. Despite the tight market, however, recruiters and industry insiders say that there are still opportunities at mid-market firms, especially in the M&A arena.

“There is definitely less activity than we saw last year,” says Stephan Renken, director of the Chicago office of Michael Page International, a leading global recruitment firm. Renken notes that while there was significant hiring in front office roles during 2007, there has been a marked decrease in terms of the overall market year-to-date.

Renken’s colleague, Casey Mulligan, manager of Banking and Financial at Michael Page International, says that bulge bracket firms with exposure to the credit markets have been hit hard in recent months, resulting in headcount reductions at all levels. He observes, “There are more candidates and fewer jobs.”

Middle-market firms hiring

The good news for investment banking job seekers is that numerous mid-market firms from New York, Boston, and San Francisco have expanded their operations into the Chicago area. These new entrants, as well as existing mid-market firms, have had less exposure in general to the credit problems than the bulge bracket firms and are now looking for experienced bankers who can bring business to the table.

“New players mean more open positions,” says Erin Polczynski, Division Director in the Chicago office of Robert Half International, an executive search firm specializing in financial services. She says,“There is a big range of need, everything from junior level to mid and high level positions at these middle market firms.”

Mulligan agrees. “Middle market firms are hiring a number of candidates and the competition is stiff.”

Generalists, M&A, Turnarounds, Restructuring

Unlike their coastal counterparts, Chicago I-bankers have always needed to be more generalists than specialists, with the ability to do well in the Midwest’s heavily commerce and industrial focused sectors. This remains more true than ever today, as the skill to function across various industries is critical. Candidates who concentrate too much in one size of deal or industry may be too narrow for Chicago, says Mulligan.

Polczynski says there is demand for professionals with experience in M&A, turnarounds, and restructuring, not surprising in light of the current economic environment. She says that while the need for specific positions varies greatly from company to company and across sectors, she notices a number of firms looking for candidates with expertise in technology and healthcare, in particular.

Characteristics

While positions exist for younger players in the market, there are more opportunities for experienced professionals with a track record of developing business. Mulligan says there is always a job “if you have good connections…new contacts and new clients.”

Polczynski notes, “Prospective employers want more than just skills in a candidate…they want a good, descriptive deal list that speaks to the candidate’s work experience.

Compensation

Mulligan cautions candidates looking for jobs to “open your expectations” regarding compensation. In I-banking, compensation is heavily bonus oriented, so the majority of bankers have taken a hit. He is optimistic, however, that while initial compensation packages may not be as high in the past, a good employee can make it up in performance.

“If you perform, you’re rewarded,” Mulligan, “This business is heavily incentivized.”

Contact:

Max De Paola
Michael Page International
203.905.5253