One of the most prevalent questions I receive from both the Public Finance Bankers, Institutional Sales and Bond Counsels is, “Is it time to look outside of our industry?” Followed by, “Can I go to the buy side?” Or if more appropriate to your particular expertise, “Can I go to the issuer side?” Today, the reasons for these occurrences are even more complicated than they were when I initially addressed this topic three years ago. The reason for its inherent complexity is that the roles of bankers and Municipal Financial Advisors have changed greatly. This is due to the MSRB, SEC and FINRA taking a very hard look at every aspect of the business. I hear that the business is just not as fun anymore. So, let’s address this concern.
We have to face reality. If you were in the business when I started and got $18.00 to $20.00 a bond, the business is clearly not as lucrative as it was back in the early 80’s. Advance refunding’s were rampant, and RDA financing was a way to really help an issuer. Should the amount of money you make on a deal dictate if the business is fun or not; thus, indicating it may be time to leave the industry. I think not! So, how do you disagree with all this data? You don’t. What you do is position yourself for the future as a banker, Bond Counsel, Municipal Finance Advisor, etc.
If we are aware that takedowns are getting skinnier, then find an area of your practice where the bulge brackets are not competing with each other. Proceed by getting away from the large deals that take a three-year rotation to get an assignment. If a Bond Counsel look to issuers that do not frequent the markets as much, offer your clients innovative financing models that they will get excited about. Look at the Regional and Super regional firms that are slowly taking away consistent market share in their local jurisdictions. Also, the Super regionals and regionals are aware of what is going on in the industry, and they are positioning themselves with excellent hires to take them into the year 2020 and beyond. They are hiring more compliance related people to make sure that what they do are correct procedurally; and to their clients, the issuers, best fiscal interests.
You Can Find The Fun In The Business As A Banker, Bond Counsel, Municipal Financial Advisor, etc.
I have mentioned this also in recent articles: what we are seeing is an exchange of seats. The bankers that are relying on their own abilities are still finding the business fun. The Bond Counsels that are finding ways for clients to finance their projects with new methods are finding the challenge in creating new working documents exhilarating, The Municipal Financial Advisors that are working on goals and policies for their clients are seeing their true benefit come across as the issuers adopt their work at Public Hearings.
As more and more issuers see that there is tremendous financial benefit to enter the market, due to the current economic climate, there are more opportunities. More opportunities make the business fun. Smaller issuers that have not gone to the market are entertaining the idea again. This increase in activity is causing more new jobs to be available as more and more FA shops are looking to expand their presence throughout the United States.
The perception that there is panic in the street needs to be addressed since there is a shift in the focus; but the industry of Public Finance is still very much in demand. As long as there is a demand for public work improvements, there will be a demand for Public Finance Bankers, Bond Counsels, and Municipal Financial Advisors. Here’s the bottom line: firms are hiring. We have been busier with new hires this year than last. As we speak, we continue to have candidates at the offer stage in both Public Finance and Bond Counsel.
In conclusion, there are definitely opportunities available throughout the United States for the right professionals. To determine if you are one of the professionals with the right stuff, reach out to me for a confidential conversation at email@example.com or for a more immediate response call 760-477-1284.
About Harlan Friedman, JD & Founding Member, H. Friedman Search LLC. Harlan is a thirty-year veteran Public Finance Banker turned recruiter who specializes in the placement of all level Public Finance Bankers, Health Care Bankers, Municipal Financial Advisors, Compliance Officers, and Bond Counsels. He can be reached on LinkedIn, at firstname.lastname@example.org or 760-477-1284.