Steve Panagos, a restructuring banker who just joined Moelis & Co., looks forward to returning to advisory work after a short and unsuccessful stint as a distressed investor. Early last year, Panagos left Kroll Zolfo Cooper LLC, where he had worked for 20 years, to join Jonathan Katz, founder of J.P. Morgan's special situations group, to form Panagos/Katz Situational Investing. Though the duo enticed Kohlberg Capital Corp. to participate as a minority investor, they couldn't raise any other money for their venture.

"I thought it was the perfect time to play the cycle in a different role than I had," Panagos, 47, explains. "I didn't factor into my thinking the implosion of the capital markets and the financial institutions." Meanwhile, "there was a huge restructuring wave out there, and I was very anxious to get back in the game."

So Panagos reached out to Bill Derrough, co-head of Moelis' restructuring practice with Thane Carlston, whom he has known since the mid-1990s, when Derrough was working for Chanin & Co. and Panagos was employed at Zolfo Cooper.

Derrough, who joined Moelis' shop from Jefferies & Co. in September, hired his old friend as a managing director and vice chairman of Moelis' recapitalization and restructuring group.

The business is "on fire," Derrough says, and there's no sign that demand for restructuring advice is going to slacken anytime soon. "I spend every day of the weekend on conference calls from day to night," he says. "A lot of these problems are difficult to solve."

Panagos concurs. Although he doesn't officially join Moelis & Co. until April 6, he's already being put to work.

"I don't have a BlackBerry, I don't have a mobile and I don't have e-mail yet, but people are already calling me about new situations and putting me on conference calls," he says.