Credit Research poll results: Moving down the credit curve
Have you heard the one about the million-dollar credit analyst? Apocryphal tales linking those in the once lowly field of credit research with heavyweight salaries were flying about the market in 1998. European economic and monetary union is the catalyst for the buying of credit by many investors previously used to interest-rate and foreign-exchange risk. As European investors warm to credit, and particularly venture into the dimly lit nether world of high-yield debt, credit researchers are in demand more than ever to sort the winning deals from those likely to default.
Last year skilled credit analysts were in short supply, their market price was rocketing and poaching was rife. Those with good reputations were in demand and moved rapidly from house to house. Greater rewards brought greater pressures: analysts were expected to cover a wider market and play more of a sales and origination role for banks. Credit research is certainly no longer an obvious option for shy and retiring types who hate to travel.
But it seems the bubble might have burst in 1999. Supply of analysts is starting to balance demand and banks are settling on their credit teams.