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US financial upheaval casts shadow over DU placements

As investment bank Lehman Brothers declared bankruptcy and rival Merrill Lynch was taken over by the Bank of America, anxious students and faculty across Delhi University colleges watched the US meltdown with apprehension.

business Updated: Sep 16, 2008 23:12 IST
Swaha Sahoo

As investment bank Lehman Brothers declared bankruptcy and rival Merrill Lynch was taken over by the Bank of America, anxious students and faculty across Delhi University colleges watched the US meltdown with apprehension.

The reason — Lehman Brothers had in 2007 recruited students from top DU colleges, including Sri Ram College of Commerce (SRCC), St Stephen's and Lady Sri Ram College (LSR).

As global markets plummeted, teachers feared the impact would show on campus recruitment, especially when it came to leading banks and financial services companies.

"The financial and services sector will definitely be affected by this development. But overall placement will not suffer much since we get companies from various sectors," said Prof Madhu Vij, placement coordinator at Faculty of Management Studies (FMS), DU.

In 2008, 46 per cent of FMS students accepted offers from firms and leading banks, including HSBC, ICICI, Yes Bank, Goldman Sachs and Avendus Capital.

"The slowdown will not affect the immediate summer internships. But in terms of final placements a slowdown is imminent," said Vij.

Students expressed their concern but insisted on maintaining a positive outlook. "We are very apprehensive regarding the US meltdown. But we are hoping it won't affect campus recruitment in a big way," said Utsav Mitra, final year Economics
student at SRCC and college president.

"We often get recruited into teams that are growing right now. We are also offered the initial positions such as an analyst, which are not affected by such meltdowns," Mitra said.

Lehman Brothers, which recruited six students from SRCC and offered the highest salary at Rs 14 lakh per anum will not be coming this year. But students are not complaining as Morgan Stanley has already made an offer of Rs 21 lakh per annum.

"The general trend of recruitment in the banking sector is bad right now. After this meltdown we will probably lose a few potential recruiters," said final year Commerce student Vaibhav Singh.

Singh feared the average salary at SRCC, which was Rs 6 lakh in 2007, might see a dip this year.

The positive attitude though, did not reflect on the students who are already working with Lehman Brothers. "I don't want to comment on the situation right now," said Neha Aggarwal, an SRCC graduate working with the Powai office of Lehman Brothers.

Another graduate from LSR said the future was uncertain. "Even the top bosses do not know who will stay and who will be chucked out. Everyone is very confused and apprehensive," she said on conditions of anonymity.

Acquisitions, mergers and takeovers are a part of the industry, said PC Jain, principal SRCC.

"Soon after I heard the news I talked to some of my students working in the Mumbai office. They are insiders and they know that nothing collapses," Jain maintained.