Lehman goes on recruitment drive

LEHMAN Brothers has cranked up its City recruitment drive with offers of two-year fixed pay deals worth up to £1m as investment bankers witness a return to a boom-time jobs merry-go-round after a three-year lull in deal activity.

The US investment bank is understood to have approached a number of corporate brokers from rival firms since the latest round of annual bonuses ended last month. Lehman does not have a specialist broking team but, like other US investment-banks, is thought to see the addition of one as a good way to beef up its mergers and acquisitions capability after lagging 19th in the UK league table and 12th in the European one last year.

Morgan Stanley last week poached a team of brokers from Merrill Lynch, one of the few US banks to have built up a sizeable broking team. That ensured Merrill-was regularly in the top three rankings for UK mergers and acquisitions.

Brokers are employed by companies but their role is seen as acting as the mouthpiece for institutional investors, allowing companies to monitor their shareholders constantly. This function is a good way for the bank to earn more lucrative merger and acquisition mandates when a deal does materialise. Fees can be up to £15m per transaction, as shown in the recent battle for Safeway.