The demand for financial risk professionals in London is rising, as are their bonuses, Reuters reports. This trend reflects banks drawing conclusions from the credit crisis as well as the trading scandal at French bank Socit Gnrale, a recruitment firm says.
The demand for risk experts is up by 65% compared to a year ago, with most of the growth happening in the second half of 2007 and accelerating since Socit Gnrale revealed huge trading losses last month, a spokeswoman for the GRS Group told Reuters. Risk professionals are commanding bonuses 15-20% higher than last year, she adds.
Banks worldwide have written off billions of dollars since August on exposure to sub-prime mortgage businesses in the United States. The importance of internal controls, which guard against unexpected losses on risk-taking by banks and illicit trades by their employees, was further hammered home after SocGen blamed a rogue trader for a $7 billion loss on a risky bet.
While banks might not have devoted enough resources to risk management in the past, they are already beginning to invest more.
The overriding adjustment has been in banks increasing aversion to risk, GRS risk consultant David Butters says. (Banks are) investing strongly in the highest-quality risk, audit, legal and compliance talent.