Insights

Finance & Accountancy

FINANCE MARKET COMMENTARY, Q2 2017

• Article by BRUIN Financial

FINANCE MARKET COMMENTARY, Q2 2017

MARKET OVERVIEW

The second quarter of 2017 saw a continuation of what we saw in the first 3 months of the year. The market has remained stable and there has been a steady outflow of new positions from both investment banking and asset management clients. BREXIT continues to have little impact on the number of roles we are seeing in accountancy & finance, and the trend of pushing for internal mobility continues.

On the investment banking side we saw a consistent push for quality product controllers with clients putting emphasis on technical knowledge, especially around exotic and complex products. This is as a result of most organisations moving vanilla and more straight forward product control teams of out of London and into low cost near and offshore locations.

In the contracts space we saw a significant increase in the number of roles by comparison to Q1.  The investment banks particularly sought candidates for product control and regulatory reporting roles, both within business as usual activity and projects. We also noted that ACA newly qualified candidates are demonstrating greater flexibility with regard to their job search, with many now open to a wide spectrum of roles within regulatory  reporting, financial accounting and FP&A.

In Q1 asset managers released a number of roles across a wide range of areas, with multiple internal audit positions varying from newly qualified accountants right through to Senior Managers and Heads of Departments. We also saw demand for top tier newly qualified accountants who were looking to move into the FP&A/business partnering space. In Q2 we have seen a continued push in the FP&A/business partnering space.

Lastly, throughout the year we have seen a constant need for regulatory accountants, mainly with strong knowledge of Solvency II, Pillar III and preparation of ICAAP.

The candidate market has stayed relatively consistent for 2017 with many candidates prioritising company culture, a flatter structure, less micromanagement, improved working hours and flexible working options. The second quarter of 2017 has followed this trend, and instead of simply looking for salary uplifts, quality candidates are far more selective on the roles they are pursuing. We have also seen the annual flow of ACA qualified accounts seeking to move out into industry, the preference for many of these candidates is front office and commercial focused opportunities.

From a regional perspective, the majority of roles have been in the financial accounting and internal audit space as opposed to any strategic or management accounting positions, with great demand for recently qualified Big 4 ACA  accountants. And as the large banks continue to establish their presence regionally, they are offering more and more competitive packages.

This has coincided with the nearshoring of many vanilla roles, which has attracted interest from candidates willing to relocate and from international candidates considering a move to the UK.  HSBC have included a large finance function in the relocation of the Ring-Fenced Bank to Birmingham and we understand this is set to continue to grow as the preference is to hire outside of London where possible. Legal & General have officially completed their move to Hove with significant demand for accountants.

ROLE PROFILES

On the investment banking side we have seen a big push on product control at all levels with high demand for candidates with strong technical product knowledge from the hedge fund industry. As a result, we are seeing a number of product controllers with complex product knowledge moving across to hedge funds to capitalise on the lucrative financial rewards.

Clients continue to raise the standard for product controllers as candidates were expected to have an understanding of pricing and risk concepts in addition to specific product knowledge. With regard to the regulatory reporting positions, employers showed more willingness to train junior candidates with a strong academic background but with limited experience in their particular fields.

The asset management industry has been dominated by roles in the fund accounting space. These roles have changed over the last 6-12 months with clients now looking for fully qualified accountants with experience in financial reporting. As a result candidates have greater salary expectations and this has saturated the candidate market with lesser skilled fund accountants who have purely focused on the NAV side. We have also seen an increase in roles in the business partnering space with clients seeking candidates who are fully qualified, with considerable FP&A experience and strong exposure to strategic decision making.

 

PREDICTIONS

From a London based permanent perspective we foresee a more protracted process as we approach the summer months – which could in turn result in a greater push for interim staff to cover any key hires.

The expectation is for a flurry of candidates seeking to secure new positions for 2018 in September which is the annual cycle and should coincide with firms looking to approve 2018 budgets.

We believe that there will most likely be a decrease in candidates looking to move on from stable permanent positions as we move closer to the third quarter of 2017 due to the sacrifice they will make on the bonus front. This is because as we move closer to the end of 2017, candidates will begin to hold out until the early months of 2018 as they wait for their bonuses to be paid. As a result, we envisage that clients will become more open to bringing in temporary workers as they wait for the candidate pool to increase in the first quarter of 2018.

Salaries will likely continue to climb regionally due to pressure from new competitors looking to move operations outside of London. We expect initially for the regional offices to maintain the current trend but as they grow and become more established we expect to see more and more senior strategic positions made available.