Debt Capital Markets Lawyers: A Step-Up Market at the Largest Firms

Anyone planning debt capital markets lateral hiring should start from one figure: how often the candidate gets a better title for moving. Sartori & Partners data show that 20.6% of debt capital markets and high yield laterals in the last 12 months joined at a higher title than the one they left. In capital markets as a whole the share was 15.1%, and across every practice 12.9%. Bond and high yield lawyers who change firms expect to be promoted on the way in, and the firms that hire them are almost all large.

The step counted is an associate joining as counsel or partner, or a counsel joining as partner. On that measure the debt capital markets rate runs 1.6 times the market rate, a gap of 7.7 points. Against capital markets, the practice it belongs to, the gap is 5.5 points.

The longer record says this is not one unusual year. Over three years, 16.6% of debt capital markets movers joined at a higher title, against 12.6% in capital markets and 12.3% in the market. The speciality stayed ahead on both measures, and the last 12 months sit 4.0 points above its own three-year share.

For a hiring partner the consequence is direct. A senior bond associate who asks to join as counsel, or a counsel who asks for partnership, is asking for what a fifth of movers in the field received: 20.6%. A seat that can only be offered at the same rank will reach fewer candidates than the same seat in most other practices.

The title mix of the moves points the same way. Partners made up 38.1% of debt capital markets laterals in the last 12 months, against 31.5% in capital markets and 27.7% across the market. Counsel took 15.9%, against 11.5% in the practice, and associates 46.0% against 56.5%.

The level shares record the title a lawyer joined at, not the step itself, so they do not show which counsel were associates a month earlier. Read beside the step-up rate, though, they describe a field where the senior titles are part of the offer. A debt capital markets search for a counsel or a junior partner should expect candidates one rank below, priced at the rank above.

In the Sartori & Partners lateral database, London's share of debt capital markets hires stands at index 240 against the market's own share. New York stands at 177. For capital markets as a whole the two cities read 119 and 169, so the London weight belongs to the debt side of the practice.

New York took the larger share in the last 12 months, 26.2% of hires against 22.2% for London. Over three years the order reverses: London took 25.1% and New York 22.9%. The movers are also more willing to relocate than most, with 24.8% changing city against 20.5% across the market. A firm building a bond bench should search both cities as one pool and budget for relocation.

The hiring sits at the largest platforms. Of debt capital markets moves to firms of known size in the last 12 months, firms of 1,000+ lawyers took 83.3%, against 69.1% in capital markets and 53.6% across the market. Firms of 400-999 lawyers took 11.1%, against 23.4% market-wide. Over three years the 1,000+ lawyers share was 80.0%, so the pattern is settled.

Concentration is high even among the large firms. The top 10 hirers took 48.0% of individual debt capital markets hires, against 25.0% in capital markets and 12.9% in the market. Sartori & Partners counted 55 firms hiring in the speciality over the 12 months.

Latham & Watkins ranks first, in the 11-20 band of hires, followed by Mayer Brown and Sidley Austin in the 6-10 band. A smaller firm competes here against platforms with issuer and bank relationships in several cities. It wins candidates with what a large firm offers less often: a defined seat, a clear title and a fast decision.

Debt capital markets hiring held flat (-6.0%) year on year, at 125 moves in the latest settled 12 months against 133 in the 12 months before. Partner hiring held flat (-6.2%), at 45 against 48. Over the same windows capital markets hiring held flat (+6.7%) and the whole market rose 9.0%.

A steady count with a high step-up rate means the price of a hire is rising while the number of seats is not. The moves that do happen are going to candidates who can ask for a title, and the large firms that take most of them are paying it. A firm that waits for a bigger pool to appear before opening a debt capital markets search is waiting for something the count does not show.

Four decisions follow. Settle the title before the search opens: with 20.6% of movers joining a rank higher, against 12.9% in the market, a same-rank offer starts behind most competing ones. Build the search across London and New York, where the speciality over-indexes at 240 and 177, and include relocation in the offer.

Expect to compete with the largest platforms, which took 83.3% of hires, and with a short list of active hirers that took 48.0%. Finally, weigh the internal route against the lateral one. Partner promotion in this speciality took a median of 10.0 years from the first year of practice over 5 years, so a lateral counsel ready for partnership can shorten the wait for a firm that needs capacity now.