Is Morgan Stanley facing a retention problem in Glasgow?

In a year when most US investment banks have pared back bonus payments, Morgan Stanley has been rumoured to have hit those in back and middle office functions the hardest. Employees in Glasgow have taken note.

In the last few weeks, Scottish recruiters focusing on the investment operations sector claim to have been inundated with CVs from Morgan Stanley employees.

The main source of disgruntlement appears to stem from bonuses, which this year have been drastically cut back without an increase in salary to compensate - a route most investment banks have taken.

"A lot of people have got zeros, but most are saying bonuses were fairly terrible," says one Scottish financial services recruiter. "Since the end of January, we've seen a lot of candidates looking to move. There's around three times as many CVs as we're seeing from competitor companies."

Morgan Stanley now employs over 1,000 people in Glasgow across operations, finance, technology and fund services and is currently recruiting.

Previously, assuming they wanted to stay in Scotland's biggest city, investment operations professionals would options would have been limited to BNP Paribas' 430-strong office.

But the arrival of Barclays last year, which has been aggressively recruiting over the last six months, has both increased their options and made people more open to a move, suggest sources.

Barclays has increased compensation per head in its investment bank by 20% on last year.

But it would be wrong to assume that money was the only motivator for people looking to exit Morgan Stanley, suggests one hiring manager with knowledge of the situation.

"There's something of an internal restructuring, with many people being required to expand their skills-base and most people are feeling slightly in limbo," he claims. "The combination of this and a poor bonus has led many people to consider their career options."