Managing the finance needs of the kings of capitalism

Corporate banking is the umbrella term applied to the various banking services offered to large companies – those worth $25m and above. This may sound simple, but it most definitely is not.

A single bank can, for example, arrange a loan for a company, which is relatively straightforward. On the other hand, they could also be involved in a more complicated syndicated loan, where several banks combine to provide the funds for a loan.

Corporate banking services also include cash management – collecting and managing a company’s cash to ensure its financial stability – managing changes in foreign exchange rates, or offering treasury solutions.

Corporate bankers target different industries, such as healthcare, public sector or retail and therefore often carve out niche areas of expertise.

Those servicing energy, mining or utilities companies, for instance, might be project finance experts, working out the business case for funding a new power plant or mine.

Key players

Roles and career paths

While most graduates joining a corporate bank will be expected to undertake a qualification, such as the Professional Certificate in Banking in the UK, they will also receive a lot of on-the-job training.

Junior corporate bankers often start out as credit analysts, assessing company balance sheets and deciding whether or not to issue loans. You may also accompany senior sales and relationship staff as they try to sell products to corporate customers. One senior corporate banker describes this as ‘bag-carrying’ – picking up tips without having much influence on the deal.

Senior roles in corporate banking are more client-focused. There are business development managers, who attempt to bring in new customers, or relationship managers, who look after existing clients. Both involve wining and dining chief executives and finance officers but are also quite technical.

Philippe Touati, head of institutional at ANZ Singapore, says there are varying standards of relationship managers – those who simply respond to ‘Requests for Proposal’ (a company bidding to numerous banks for its funding needs); those who are first to receive client calls about potential opportunities; and ‘trusted advisors’ – bankers with deep client relationships. “The good ones are in the second and third category. The best ones are trusted advisors,” he says.

Relationship managers have a support team. But when the company needs to raise finance, the relationship management team also provides transaction and structuring advice.

If you’re not up for a client-facing role but still want to work in corporate banking, you have the option of working in risk/credit assessments or product, operations or treasury management.

Pay and bonuses

Graduates usually start on about $35k, according to the banks we spoke to, and a senior relationship manager can earn up to $210k, according to recruitment sources.

In Hong Kong, a relationship manager can earn $30k-70k in their first four years on the job, according to recruiters Robert Walters, rising to $115k-192k at the senior end. The range for the same level of experience in Europe is $120k-142k.

Skills sought

You have to be affable to win business and maintain relationships, but you also have to be a ruthless number cruncher. After all, there’s no point in lending money to a client if they’re likely to fail to pay it back.

“Our business involves risk. We underwrite significant amounts of debt against tight time deadlines in a highly competitive environment,” says

Matthew Gibbons, managing director and co-head of leveraged finance at BNP Paribas. “A sharp intellect and enquiring mind coupled with a willingness to work hard over sustained periods are essential pre-requisites to ensure that deals get done.”

Not only will you be required to keep up with developments in various industries and the implications of these on your clients’ risk appetite, but you’ll also need to be aware of the regulatory hurdles and the cultural sensitivities of doing business in several countries, as many roles cover a number of geographical locations.

Fundamentally, however, successful corporate bankers need to be the right combination of tenacious and sociable.

“You must have the drive and energy to succeed in an environment that is relentlessly competitive,” says Touati. “Corporate bankers are natural goal-setters with a passion for business and tend to have a keen ability to leverage networks in order to offer solutions for the client.”

Corporate bankers will be given a lot of responsibility relatively quickly, so employers want to see evidence of maturity and client focus, even at a graduate level.

“We are a people business and our team members need to be able to manage relationships with demanding clients in such a way that they are happy to transact with us time and again,” says Gibbons. “Softer ‘people skills’ and an ability to negotiate are key elements for success.”