Barclays continues its investment banking offensive.
Barely a week seems to go by these days without one of the senior bods at Barcap chucking the press a bone about the number of new hires the bank will make in the coming weeks/months/year.
Since March, high-profile senior recruits have been followed through with broader hiring plans of spiralling grandiosity: to add “30-40″ new M&A advisors in Europe; “15-20″ in the UK; to “double” the size of its Japanese IB staff; to hire new talent “across Asia”; to hire “300″ new staff for the investment bank in total.
And today: to hire more than 750 new investment banking staff before the year is out, according to Barcap president Jerry del Missier.
The thrust of today’s announcement (previous ones have mostly been about the bank’s M&A advisory ambitions) is that Barcap will become top-dog in equities: matching its already impressive strength in bonds and currencies. The plan is to hire 700 new equity market staff (450 of which have already been hired). Reuters quotes del Missier today:
It’s certainly our intention to be a leading global player in equities and advisory over the next few years.
The goal is also, clearly, to become the leading prime-broker. Nevermind “top-three”. While former US prime brokerage giants rush to delever, Barcap, it would seem, has its eyes on some of their prize hedge fund clients.
Rather than simply capitalise on its rivals weaknesses, though, Barcap might do well to learn from them. The explosive growth of prime brokerage operations at Wall Street’s investment banks was what – in spite of their often lower leverage compared to their European counterparts – made them extremely prone to collapse.
Bear Stearns, Lehman and Merrill were all victims of runaway prime brokerage businesses – operations that made them weak and extremely susceptible to massive and capricious flights of capital in the event of troubles elsewhere on their balance sheets.
Related links:
Investment banking is dead, long live the investment bank – FT Alphaville
Investment bank, RIP – Portfolio
Who said investment banking was dead – Independent