Euro Shops To Continue Hiring Spree

With some market players projecting as much as $20 billion of euro- and dollar-denominated issuance in Europe, the hiring spree for junk pros there isn't likely to stop anytime soon.

Experts said the door may finally be closed to new entrants in Europe, as a host of underwriters have already set up shop there. Thus, going forward, they expect the existing shops to continue adding to their staffs as the battle for market share intensifies.

Estimates vary on just how big the European high yield market will become, but the overall consensus is that this year's volume should well exceed last year's $10.6 billion and the $3.6 billion recorded in 1997.

A focus on telecom will dominate issuance as well as the new hires, according to financial headhunters, as deregulation overshadows a new competitive market. Also worthy of note, most of the talent will be shipped over to London and Paris from the U.S. instead of cultivating local experts, according to market sources.

Banque Nationale de Paris, the third-largest bank in France, provides a good example of these trends. The bank is beefing up its European high yield presence in the wake of its foray into the U.S. market earlier this year, and it hopes to expand its presence, especially in media and telecom in continental Europe.

The company recently hired Rick Deutsch away from Merrill Lynch's London efforts to be head of its European high yield research, also based in London. Deutsch said he is BNP's first dedicated research

analyst for the European market.

Deutsch, who was co-head of the high yield desk at Merrill's London office, will coordinate his efforts with Eric Dumas, head of spread products in Paris, and Sherri Andrews in the New York office, in high yield sales and research.

ING also firmed up its high yield team earlier this year with the hire of Colin Marshall, a research analyst from Schroder in New York, and Vincent Moge, a syndicate salesman from Credit Lyonnais. The team is now at the proper size, said Tim Hall, head of European high yield, and now the firm plans to further develop its overall presence in Europe, with high yield playing an integral part of those plans.

Meanwhile, some banks are stepping up European high yield at the expense of other, less profitable areas. Bank of Tokyo-Mitsubishi, for example, intensified its focus on European high yield earlier this year as it pulled the plug on its New York City-based emerging markets desk.

Salomon Smith Barney recently lured John Engelen, a 10-year veteran, away from Merrill Lynch as managing director in high yield sales and trading. He will oversee the global distressed credit business, which includes distressed corporate issues and bank loans. Those deals used to trade on several different desks, but now Salomon plans to bring them under one global effort and strengthen that part of the high yield business.

The company said that Engelen's hiring expands the reach of the U.S. business and also lays the groundwork to eventually grow it in Europe and Asia as well.

CIBC World Markets has hired a litany of pros over recent weeks as it essentially doubled in size since the beginning of the year to about 20 people. The most recent, both of whom resigned from Deutsche Alex. Brown in the wake of the merger between Deutsche Bank and BT Alex. Brown, were Philip Volpicelli and Mark Weinberg. They will join as director of European high yield research and junior analyst, respectively.

And finally, CSFB also is ramping up. The company named James Amine, managing director and head of its European high yield efforts, and Colin Hely-Hutchinson, managing director in the acquisition finance group, to be co-heads of its European acquisition and leveraged finance group.

In addition, CSFB moved Andrew Holmes, a vice president in leveraged finance, from New York to London to join the team.