The
growing demand for senior investment bankers in Latin America is driving up
compensation levels, especially in Brazil where they can now command premium
salaries in excess of their emerging and developed world counterparts.
This
year, a top investment banker in Brazil will earn an average $1.7 million,
according to Options Group, a global recruitment consultancy, twice as much as
in China, and 15 per cent more than managing directors in India or the US.
Latin
America is seeing record levels of mergers and acquisitions, as well as debt
and equity issuance. This year, M&A has more than doubled in value from
2009 levels to $207 billion, according to data provider Dealogic, a 10th of the
global total.
Meanwhile,
bond issuance in Latin America has risen by 20 per cent to $97 billion, while
equity issuance is up 67 per cent to $51 billion.
This
spurt in activity has left international banks struggling to find senior
bankers to expand their operations, especially in Brazil. Unlike in Asia and
the Middle East, where English is spoken, Portuguese is essential.
“It’s
easier to find Spanish-speaking bankers on, say, Wall Street, who might want to
move to Mexico. There isn’t the same surplus of Portuguese speakers,” said
the head of investment banking at one large European bank.
Senior
bankers also need to bring international expertise and government connections.
A fifth of Brazil’s publicly quoted companies count the state, in one form or
another, among their top five shareholders.
As
a result, international banks have to poach staff from Brazilian companies,
luring them with big pay packages.
Revenues
from emerging markets stand at $11.4 billion so far this year — a fifth of
global activity, Dealogic estimates. China accounts for $4.5 billion, and
Brazil for two-thirds of Latin America’s $1.5 billion total. Indian revenues
are $877 million.
Most
international banks are expanding their Brazilian operations as São Paulo
becomes a regional financial hub. Brazil, meanwhile, is expected to become the
world’s fifth-biggest economy by 2025. Deal flow between the region and Asia
and Africa is also rising.
Related Videos
