UK banks will still hire and employ 26 workers to look after their proprietary trading businesses, even though a regulatory crackdown on the practice has made it more expensive for banks to trade on their own behalf – The FT reports.
Data from executive recruitment firm DHR International has found that 26 management-level employees are listed as responsible for proprietary trading. This form of trading has been out of favour with regulators ever since the financial crisis.
Simon Mansfield, DHR International’s Managing Partner, told the FT: “The increased regulatory burden on banks has pushed many proprietary traders towards the hedge funds in recent years. It is not just traders, there is also a whole host of support staff and related positions moving with them. This includes designers of algorithms or ‘quants’, IT support and even specialist compliance teams.”
The area between proprietary and market training can be grey and blurred, as banks should be able to show that their position is to satisfy “the reasonably expected near-term demand of clients, customers, or counterparties” – which cannot be measured in exact science.