Kestrel raids rivals in fresh round of talent war among investment firms

Kestrel CEO Andre DeSimone. He declined to comment on the latest raid, saying it had not been concluded. Photo/FILE
Kestrel CEO Andre DeSimone. He declined to comment on the latest raid, saying it had not been concluded. Photo/FILE 

Stockbroker Kestrel Capital has raided one of its top competitors in the latest high-profile fight for talent.

The market intermediary has poached five staff from African Alliance Investment Bank’s equity, bonds desks and operations department.

Chief executive Andre DeSimone declined to comment on the issue, saying the firm is yet to conclude the latest recruitment drive.

“I have no comment on this one,” Mr DeSimone told the Business Daily. Industry insiders said there was still a senior African Alliance staffer—who did not respond to our queries—expected to join the five but is yet to clear.

This is the second time in less than three years African Alliance Investment Bank is being raided by its competitors.

Standard Investment Bank poached Francis Mwangi and Eric Musau, two experienced research analysts, in July 2011.

Around the same time Faida Investment Bank had taken six traders from African Alliance’s trading desk including Lucas Otieno, who was then managing director at the pan-African investment bank.

Poaching of top talent is, however, not exclusive to African Alliance. Standard Investment Bank recruited two traders from Sterling Capital in July 2011.

Renaissance Capital, a Russian-owned investment bank, suffered a similar setback in 2008 when it was raided by Equity Bank in a clean sweep that included then chief executive Maina Mwangi for its new subsidiary, Equity Investment Bank.

The relationship-based nature of the business often means that when brokers and analysts move, they take their business or clients with them.

This has resulted in stockbrokers not shying away from opening cheque books to woo star talent that can attract business especially from institutional and high-net worth investors.

Published results show that Kestrel Capital raked in Sh480 million in revenues in 2013 while African Alliance made Sh447 million. Dyer & Blair Investment Bank was the top earner with Sh877 million in revenues.

Investment bank and stockbrokers are also willing to pay a premium for staff that can also attract foreign investors who do majority of trading at the Nairobi Securities Exchange (NSE).

Human resource consultants say the finance industry is expected to see a fluid and vibrant labour market due to a high demand for technical skills.

A survey by consultancy Ernst & Young (EY) released in May said that the root of the perennial poaching by Kenyan firms is lack of investment in developing and nurturing talent, which has increased competition for the talented staff available.

A survey released by PwC in January said fast-growing industries like banking and telecoms are expected to see employers either match or increase benefits to keep their best workers.

“Companies are offering higher pay as a key talent-retention strategy,” said Kuria Muchiru, PwC’s human resource leader for Central and Southern Africa at the time.

The survey found that 97 per cent of Kenya’s business leaders agreed that their firms needed to match the compensation levels of their peers to retain top talent, which was above the global and the continent’s average of 69 per cent and 79 per cent respectively.