Citigroup Inc. is the latest company to siphon off corporate finance talent from Merrill Lynch & Co.

Salomon Smith Barney Inc., Citigroup's investment banking subsidiary, announced Tuesday that it has hired four loan and distressed-debt analysts and traders away from Merrill.

Making the move are John Engelen, John Humphrey, Jeffrey Jacob, and Edward Sutherland. They are the latest in a long and steady stream of defections this year that have changed the face of the leveraged debt group at the investment bank.

At least 14 Merrill bankers have jumped ship since January, when Merrill said bonuses would be delayed a year and would be based on the company's performance in 1999.

Executive recruiters and former Merrill bankers say the compensation package has not gone over well, even among longtime members of the firm. That has led to a flood of resumes from Merrill employees onto Wall Street.

The defections have come in key corporate finance businesses such as the leveraged buyout sponsor group, mergers and acquisition advisory, and high- yield debt trading.

The defectors also appear to be following Thomas Gahan, Merrill's former head of global leveraged debt. Mr. Gahan left in January to take a similar job at Deutsche Bank. Since then at least five more Merrill bankers have left for Deutsche.

"They're all following Tommy," said an executive recruiter who has placed several former Merrill employees, "and there's going to be more people taking that path."

The recruiter said it is no surprise that Deutsche Bank and its imminent merger partner Bankers Trust seem to be getting most of the Merrill talent. The firms have traded top investment bankers during recent years.

The Deutsche Bank connection to Merrill predates Mr. Gahan's defection. Christian Thun-Hohenstein, co-head of European investment banking for Deutsche Bank, came over from Merrill in 1996.

A Merrill spokesman said his firm has hired some outside talent.

"We've got people knocking on the door to work here," he said. "We've got a top tier franchise and a very deep bench."

In an interview in March, Mark Maybell, a Merrill managing director for global communications, financial sponsors and private equity, said the jobs left vacant by defectors would be filled by internal candidates.

"The talent in these businesses runs very deep," he said.

Mr. Maybell also said the firm was using the top level resignations as" an opportunity to integrate" Merrill's debt business.

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