Is Shearman & Sterling turning the corner? Senior partner Rohan Weerasinghe certainly thinks so. "We've been very actively focusing on getting the firm structured so that when the upturn comes we'll significantly benefit from that," he says. "I'm fully expecting that we'll go right back to the trajectory we were on before the downturn."

That trajectory saw Shearman increase its average profit per equity partner (PEP) by 60 per cent between 2004 and 2007. Although the global economic meltdown has affected Shearman at least as much as the other top New York full-service firms, the firm has also faced internal issues that have led to the loss of a string of key partners.

But there are definite signs that the most turbulent period in its history is behind it.

Don't look back

Weerasinghe has been in the hot seat during that period. Over the past two years Shearman has faced not only the impact of the economic crisis and the attendant falloff in deal volume, but the exits of partners such as Peter King in London, in Germany Rolf Koerfer, Gottfried Breuninger and Astrid Kruger and most recently a pair of antitrust partners in Brussels, not to mention the entire Mannheim office last year.

The firm's financials were also hit by the downturn - although it is hardly alone there. Global revenue dipped by almost 5 per cent last year, from $921m (pound 579.26m) to $876m, while PEP was down by around 10 per cent to $1.67m.

Now, however, Weerasinghe is confident that the future looks decidedly brighter. The week The Lawyer met him in the firm's Manhattan office coincided with the first anniversary of Lehman Brothers' bankruptcy filing.

Weerasinghe recalls "a reasonable degree of excitement" about what was happening, mixed with concern, "because we were obviously cognisant of the troubles these institutions were going through and the issues faced by people we've worked with for many years".

When quizzed about the shape of the firm, and in particular the finance practice, Weerasinghe highlights the relationship with key client Merrill Lynch, one of the highest-profile casualties of last year and now part of Bank of America (BofA). Shearman advised Merrill on the deal.

"We continue to represent BofA and the people who were both there and who went there as part of the combination," insists Weerasinghe. "Even though Merrill is no longer an independent institution, we've worked with BofA before and we continue to work with BofA. It continues to be extremely strong. Absolutely."

However, Weerasinghe refuses to comment on the controversial litigation with the SEC, in which Shearman received a prominent slap last month from Judge Jed Rakoff.

Good vibrations

Weerasinghe is less interested in events a year ago than today's markets and is far happier discussing what the future might hold than Shearman's rather checkered recent history.

"We've been operating under an overall strategic vision for several years, certainly since I started as senior partner, which is a mid- to long-term strategy," he says. "Our financials improved very rapidly on a profit per partner basis and, although in 2008 those numbers were down, it was still our second-best year. I certainly don't expect this to be more than a one- to two-year hiatus in this trajectory."

Weerasinghe's optimism can be backed up by a decent dealflow. Two former partners (who prefer not to be named) endorse his claim that the firm is on the up.

"Shearman got hit quite significantly in capital markets and M&A during the downturn, but now Germany's been booming like hell and is still booming like hell," says a former partner.