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Compliance

COMPLIANCE MARKET COMMENTARY, Q4 2017

• Article by BRUIN Financial

COMPLIANCE MARKET COMMENTARY, Q4 2017

MARKET OVERVIEW

2017 continued to be a very busy year within Compliance, particularly with the arrival of MiFID II in the first week of 2018, although we did also see the typical December/Christmas slow-down. An Increased stability in Financial Markets following ‘Brexit’ results led to a surge of hiring during the course of Q1 which ended up as our busiest quarter.

Across the buy-side we have seen a steady increase in hiring. We have had multiple roles across all specialisms of Compliance, at all levels, from household names in the market. The need for true Asset Management experience is greatly desired, but due to a shortage of high quality candidates there is a greater flexibility to candidate experience.

As the year has progressed there has also been an increased need for GDPR consultants on both a permanent and contract basis. The GDPR Regulation which arrives in May 2018 will replace the current Directive and will be directly applicable in all Member States, without the need for implementing legislation.

The contract market has also seen a rise in recruitment across all levels. Given the continued regulatory scrutiny and various regulatory projects many of our clients have increased their spending on contractors.  Candidates with generalist compliance experience have been particularly sought after in this busy market. As a result clients should be prepared to deal with candidates who have multiple offers at any given time.

Role profiles

 

Asset Management

Advisory

This was a particularly demanding area as the need for highly skilled SMEs within certain regulations and asset classes was a focus for many of our clients. Front Office Compliance candidates continued to be highly sort after.  Whilst this experience was the ideal, a lot of candidates who come from a guideline monitoring / investment compliance background have been able to transition into these roles as they hold a good understanding of certain asset classes and the trading lifecycle.

Financial Promotions

Whilst there are larger teams such as Front Office Compliance and Regulatory Compliance, an area which has seen a noticeable increase in activity has been within Distribution / Financial Promotions. Whilst a niche area, demand for candidates has been much higher than previous years. Again this has been a candidate driven market with junior financial promotions analysts securing roles on higher basic salaries than previous years. On the contract side this has been an area of high activity in 2017, with several senior candidates making the transition to the contract market.

Compliance Monitoring

Monitoring has always been a consistently active area. Over the course of 2017, many asset managers grew their compliance monitoring teams to account for the increased regulations embedded into the buy side. With the volume of monitoring positions hitting the market in 2017, we noticed clients started to express more flexibility in where the candidates came from. We have witnessed an increase of candidates moving between the buy and sell side, as well as candidates moving from audit into monitoring, as whilst they don’t possess the asset management experience, they do bring the monitoring methodology.

Guideline Monitoring

This was our most active area in 2017. With a large majority of clients implementing new systems, particularly Sentinel and Aladdin, clients were seeking compliance officers with not just pre/post trade monitoring experience but individuals who have exposure to coding. This has resulted in a very candidate driven market and relating salaries rises.

With a niche market for system coders and expert candidates within guideline monitoring, clients started to show more flexibility with candidates, this resulted in some even willing to sponsor certain individuals. From a contract perspective given the small number of candidates available in the market, clients have begun to provide training for exceptional monitoring candidates to transition into coding.

 

Investment Banking

Advisory

Activity within Investment Banking has not been as buoyant as the buy side but there has still been a high demand for particular individuals with Front Office Advisory experience. With many of the larger banks starting to implement automated trading systems, there has been a high demand for candidates who have an understanding of electronic trading. Fixed Income and Equities saw a significant amount of activity towards the end of last year with clients willing to pay out bonuses and accept the higher salary brackets candidates were after due to the demand of SMEs.

Monitoring

With buy side clients more open to candidates from a sell side background, banks have started to follow the market trend and look to the fundamental skill set of conducting full lifecycle reviews as the priority, rather than line of business exposure meaning candidates have been able to make the cross over from sell-side to buy-side far smoother.

Private Banking and Wealth Management

Another particularly buoyant area in 2017 saw the increase in Private Banking and Wealth Management positions. This was an area of growth for many of our clients as well as more boutique firms that we operate with. Due to the size of the teams this has been an attraction for most of our candidates as Private Banks and Wealth Managers can offer a diverse working environment which allows them to gain exposure to areas of compliance which more specific teams within the Investment Banks and Asset Managers sometimes can’t.

 

REGIONAL RECRUITMENT

Q3 has been a very busy quarter for our regional offices. In fact Compliance has seen a 25% increase in job flow in comparison to Q2.

HSBC and Deutsche Bank have continued to build their Surveillance teams in Edinburgh and Birmingham with lots of activity across Associate level.  In addition Deutsche Bank also added Compliance and Control Room Analysts to their growing Compliance department in Birmingham.

Going forward we predict the hiring volume to continue into the early parts of Q4. However imminent hiring freezes will take come into affect which will soon slow do recruitment across all levels.  Historically speaking the market slows down in the months leading up to Christmas due to holidays and bonuses.

 

PREDICTIONS

2017 was an extremely busy period within the Regulatory Compliance space, and we envisage 2018 being no different. January is traditionally a slower month, but as firms conclude their assessments of headcount requirements for 2018 we will have a lot more clarity about hiring needs.

One thing we can be sure of is that as bonuses are announced & paid over the next couple of months, there will be a market increase in movement within the Compliance market. Whilst bonuses for Compliance staff are consistently strong and technical specialists are well looked after, there is always an element of natural attrition that creates movement within the space.

In addition, there will always be new regulations that impact hiring needs within Compliance. With MIFID II going live, we envisage the shift in focus to move towards themes GDPR, as well as firms bolstering their regulatory teams looking at the impact of Brexit.

Due to the upcoming regulations, high level of activity will continue within the contract market. Thanks to the increasing contract daily rates across various compliance teams we’re predicting many more candidates to make the transition into the contract market. training when necessary.

BRUIN News

BRUIN recently held an event in partnership with The 30% Club and Women Ahead, a diversity mentoring specialist at M&G’s London offices. This was held in November to explore the innovative strategies being used by firms to attract and retain women in City and address the challenge of gender imbalance within financial services, with over 100 financial services professionals in attendance. This event complemented another recent event held at M&G’s offices focusing on Women Returners for the Diversity Project, for which BRUIN is represented on the Steering Committee and presented on the day.

Please get in touch if you would like to hear about further events on this theme.