Despite the uncertainty about the prospects for revenue in the short-term, firms continue to invest in their investment banking operations and make key hires in critical areas.
We've all known for some time now that Bank of America is quietly going about its business on the investment banking front. And to underline this fact, The Wall Street Journal apparently got hold of an internal memo recently sent out to Bank of America investment bankers, sales staff and traders which said, in part, that the bank's corporate and investment banking unit could expect 'significant investment......to transform our business by being very aggressive in chosen spots where we know we can dominate'. The newspaper quotes unnamed 'people familiar with the plan' who have apparently estimated that up to $600m will be invested in the division in the next few years.
The memo, authored by Al de Molina, the head of the corporate and investment bank, is said to continue: 'a substantial international presence will be essential for us to meet our goals and our clients' needs. We'll expand....businesses in both Europe and Asia'.
And Bloomberg reports that Nomura International is to triple the size of its equity derivatives business in London and is looking to hire an additional 50 heads from rivals. Other firms are looking to beef up their high-yield operations. Bank of America is thought to have already hired 12 into its London-based high-yield team this year and Societe Generale has now said that it will hire up to 10 staff in this area in Europe. ABN Amro has made some progess beefing up its European leveraged finance and high-yield team this year and Merrill Lynch is said to be on the hire again in this area.