Ireland – which has established itself as a centre for banking IT operations – looked like a prime candidate to suffer in the light of shrinking technology budgets in financial institutions this year. However, appetite for hiring seems undiminished and performance has defied market conditions.

First Derivatives, an Irish-based firm that provides support services to the investment banking market and derivatives technology industry, has posted a 21% increase in profits to the end of August 2008 against the same period last year.

While investment banks are shelving non-core IT projects, First Derivatives reckons the take-up for its products around algorithmic trading and complex event processing has risen in the last six months.

This time last year, the firm employed 102 people. This headcount has now swelled to 144, and David Anderson, chairman of First Derivatives, says it’s looking at further hires later this year. It’s currently recruiting for graduates, as well as developer and software engineer positions.

The company’s plans seem to reflect moves at other financial services IT firms in Ireland: Citigroup intends to recruit an additional 30 IT staff this year and spread-betting firm Delta Index plans to double its development team in the next 18 months.

Aileen Hallahan, managing consultant for IT, at recruiters Hudson in Dublin, tells us: “All the major banks in Ireland seem keen to recruit for IT roles, and financial services in general remains buoyant on the technology side for both permanent and contract positions.”

In the UK, IT contractors have had to battle with the twin blows of a 12% rate reduction and, in many cases, contracts not being renewed at all. Irish IT workers have so far been sheltered.

Hallahan adds: “Contractors are generally a more expensive option than taking on permanent staff. However, while one or two international firms have imposed rate cuts, so far most companies have been happy to renew contracts at the current levels.”