In the wake of Société Générale’s €4.8bn trading scandal, risk managers are set to become hot property.
SocGen’s crisis has reopened some old wounds in Australia. At NAB’s annual shareholders’ meeting this month, chairman Michael Chaney was forced to revisit his bank’s AU$360m foreign currency trading scandal of 2002-03 .
“When something like the SocGen incident occurs, banks like ours get as much information as they can about the incident from public sources and wherever they can, so that we have yet another look at our systems and procedures and make sure that it is unlikely to happen here,” Chaney said.
Could SocGen happen here? Probably not – at least according to Caan Krstew Ivanow of Melbourne recruiters Graeme V. Jones & Associates. He says Australian banks have been big hirers of risk managers since the NAB scandal, and have put strong compliance measures in place.
“Australian banks have focused heavily on risk compliance, so from a risk perspective Australia is very set in the marketplace,” he says.
Luke Heath, CEO of Chandler Heath, says that there has not been a noticeable lift in demand for risk management staff since SocGen, but notes, “There has been a very good demand for high-quality risk and credit people over the last three years.”
With responsibility for a bank’s absolute position size, total risk, liquidity risks and counterparty risk, Heath says a senior risk manager in a dealing room role could easily earn AU$200k base, with a bonus of up to 50%. A person with around four years’ experience, who is not sitting in a dealing room and is looking at broader risk, will be paid about AU$120k, with a bonus of up to 40%.