From earning some of the biggest pay packages in the City, leveraged financiers have reason to worry about losing their jobs. What are their options?
Not many, according to headhunters. Last week the Financial Times cited leveraged finance as one of the areas where banks are looking at getting rid of staff. However, one headhunter who works in the area says cuts are most likely at some of the smaller European banks such as Calyon and Dresdner Kleinwort, which have only entered the industry relatively recently and failed to make much headway.
"There's not much these people can switch into," he says. "The more experienced guys at the bigger players are sitting tight for the moment and waiting to see how the losses pan out."
For the best leveraged financiers, he says there are several options - moving into a distressed debt fund or a corporate restructuring team, or going into investment grade bond origination, which is likely to recover more quickly.
Distressed debt funds could prove the best option - earlier this week, the Financial Times reported that many big event driven funds are canvassing investors to gauge interest in new distressed funds that will buy back the leveraged debt banks currently have stuck on their books.
However, the headhunter we spoke to says opportunities are limited: "Most of these areas have been built up already."