WSJ What’s News Inside Wall Street’s Recruitment Wars
The Private Equity War for Bank Analysts Is Heating Up
Private equity firms are aggressively recruiting recent college graduates who started as analysts at big banks, causing frustration among banks due to lost investment in training.
Banks invest heavily in training these new hires, but many leave for lucrative private equity positions shortly after, leading to policies like Morgan Stanley's disclosure requirements and JPMorgan's warning of termination if future offers are accepted within 18 months.
This competition raises concerns about conflicts of interest since bankers working on confidential deals often may move to private equity firms on the opposite side of transactions.
The tactics include interviews late into the night and pressure to accept offers quickly, despite job start dates years away, illustrating the intensity of this recruitment battle.
Private Equity Poaches Trained Analysts
- Private equity firms aggressively recruit analysts from big banks to capitalize on the banks' training investments.
- Banks face frustration as they fund training that ultimately benefits private equity competitors.
Banks Enforce Job Offer Disclosures
- Investment banks implement policies to curb analysts accepting future job offers to private equity firms.
- Banks require disclosure of job offers and may terminate analysts accepting early offers to protect investment.