Insights

Finance & Accountancy

FINANCE MARKET COMMENTARY, Q1 2018

• Article by BRUIN Financial

FINANCE MARKET COMMENTARY, Q1 2018

MARKET OVERVIEW
Q1 2018 has been busy, with a significant increase in roles released to market by comparison to recent years, and two emerging trends.

The first of which is that the majority of roles have been replacement as opposed to growth hires and, interestingly, not necessarily a like for like skill set. We believe this reflects efforts of financial services firms to become leaner and more agile by reducing the head count and splitting the workload of roles.

Secondly, firms have increasingly sought to fill replacement hires with more junior candidates as a way of reducing costs. This in turn has allowed more responsibility to fall to incumbent team members and for effective succession planning.

Within Investment Banking, we have noted consistent demand for Product Controllers who possess strong product knowledge in technical areas, a trend established in H2 of 2018 that has continued. This is as a result of Investment Banks seeking to move the less complex areas of product control to low cost locations. Furthermore, there has also been an increase in the project element of product control roles as banks look to utilise skill sets into redefining and improving processes whilst managing the offshore teams.

Within Asset Management a significant number of requirements were located outside of the UK, with the majority Luxembourg based, as part of Brexit readiness programmes. This has been a trend from a number of firms ranging from Boutique funds to Tier 1 entities. However we have also seen an unexpected increase in hires across FP&A and Management Accountant in London as firms look to have candidates in place and up to speed as their businesses evolve into more complex entities, and due to MiFID costs being absorbed internally by most firms a more detailed review of budgets / costs is demanded to produce effective MI.

ROLE PROFILES
Q1 of 2018 has brought a wide variety of roles with a significant volume within Fund Accountancy and FP&A functions.  Although many Investment Banks have already, or are in the process of off shoring Product Control functions, we are still recruiting for a number of Business and Product Control roles in London.

Within Investment Banking, functions are becoming more streamlined, hiring is more calculated and

profiles are becoming more niche. Hiring managers are more focused on project work, or very technical skills that can accommodate the specific project or function they are operating within. It is customary for clients to expect strong educational background and full qualifications, but emphasis is on core technical ability and specific expertise. Additionally there is a desire to recruit VP level skills within the AVP bracket with the incentive of swift progression that cannot be met at the candidates host firm, this has been met with a varying degree of success as immediate progression is often a pre requisite from a candidate search perspective.

Within Asset Management, the bulk of roles are junior to mid-level Fund Accountancy positions with emphasis on industry experience over purely strong academics and the potential to learn within the role. With the majority of Junior Fund Accountants looking to move away from Third Party Administrators to in house roles, clients are becoming more open minded to the range of profiles that will be considered.

In the contract space, candidates with advanced technical IT skills were better positioned to secure a role, and contractors that combined solid stakeholder management skills with VBA and SQL knowledge enjoyed a particularly competitive advantage within the market.  In the Product Control, Valuations and Fund Accounting spheres VBA skills were highly sought after due to various automation and process improvements projects undertaken by our clients.

Audit
The Audit department at BRUIN was expecting a dramatic increase in roles for Q1 of 2018 which has certainly come into fruition. Off the back of bonus pay having a significant impact on the movement of candidates, the volume of roles becoming vacant has also been directly affected. The Audit function within banking has continued to increase throughout Q1 and off the back off larger Investment Banks ‘ring fencing’ their day to day functions to other regions, the internal movement has opened up other opportunities in London. Alongside this, we have seen a dramatic growth in the volume of roles in Europe, especially Luxembourg across Banking and Asset Management.

In terms of trends we have seen in the roles, there has been a great deal of variation across positions, from newly qualified candidates through to senior (100K+). The challenges with the level of roles that have been released in month 1 and 2 of Q1, is that a significant number of people are interested in waiting to see the outcome of ‘Bonus Time’. As we move into Q2 we can already see the job flow continuing at the same rate, and now the candidate pool continues to grow as well.

PREDICTIONS
With the bonus season and year end reporting period coming to an end, we expect the same general trend of growth set in Q1 to continue in Q2 as a result of the cyclical movement of candidates looking for promotions or new challenges. As a lot of financial institutions will continue their offshoring

and relocation projects, some permanent positions based in London could made redundant. Naturally, given the above mentioned circumstances, our prediction is that there will be an increase in the number of Contract positions available in the market.

During the second quarter, we foresee that firms will be receiving sign off for hiring that is part of their 2019 budgets to ensure they have the human capital in place to deliver on their strategic goals for the year, it is likely the majority of these hires will be external due to a lack of credible candidates ready to “step up” and the desire to bring in proven experience and a shallower learning curve.