Lured by the launch of new boutique advisory firms, Australian expatriate investment bankers are returning home in large numbers, in what is likely to be signs of a strong economic rebound following the coronavirus-induced COVID-19 pandemic which triggered a recession.
The development underscores the reversal of a tradition wherein Australian bankers headed overseas to more tax-friendly global financial centres.
“There is a brain gain happening in Australia, we are acquiring additional knowledge and experience,” said Nick Hughes, Australia co-head at UBS.
Corporate Australia has set a scorching start this year, with deals worth $6.21 billion in the M&A sector already underway; this is more than seven times compared to the same period in the previous year. This has placed Australia second in the Asia Pacific behind China; in 2020, it was in the seventh place over the same period.
This trend is expected to continue in the near-term, with big-ticket deals including the potential sale of casino operator Crown Resorts as well as the divestment of some financial businesses, which are in the pipeline.
Barrenjoey Capital and Jarden’s entry into the sector, has fuelled a talent war in the country, pushing up wages by at least 20%.
According to Jarden’s spokeswoman, it has hired eight Australian expatriate bankers, traders and analysts as part of its campaign to build out its local franchise.
Goldman Sachs is seeing eight Australian staff returning from offshore to work in Australia; UBS also saw four returnees in recent months, according to the banks’ spokeswomen.
According to Joseph Fayyad, Bank of America’s country head, the bank has hired two senior expatriate bankers.
“With new entrants establishing a presence and the incumbents defending their positions, there are more available seats for senior bankers,” said Fayyad.
The bulk of the returnees are coming to Sydney from either London or New York. Their experience ranges from mid-career to senior bankers and legal and compliance staff.
They are among a lucky few currently allowed to enter Australia, which has closed its international border to almost all travellers other than returning nationals and permanent residents.
“I think Australia’s outperformance during COVID has put a real spotlight on the benefits of working and living down under, so the combination of more available seats and a greater desire from Australians to come home has really fuelled the trend,” said Fayyad.
According to local banking executives, an increase in onshore deal activities is enabling banks to offer fatter paychecks to New York and London returnees.
The “brain gain” had helped the emerging bank build its team to almost 100 since its launch a year ago, said Aidan Allen, who heads investment banking at Jarden Australia.
“A lot of our talent has come from offshore, people wanting to return home has been a massive opportunity for us,” said Allen. “We think it’s a point of difference, it’s given us the opportunity to have a more diverse and experienced bench.”