As China’s fledging private banking sector starts to expand, local and foreign firms face a fierce battle to find talent.
The number of mainland (US dollar) millionaires is expected to reach 450,000 by the end of the year, according to a new report from Boston Consulting Group. And private banks are obviously keen to turn them into clients.
Global players, including HSBC, Citibank and BNP Paribas, have all set up private banking operations in the China since 2007. Singapore’s DBS has also revealed plans to establish a presence.
Domestic banks dominate the market in terms of customer numbers and assets under management, thanks to their larger retail networks and customer bases. Industrial and Commercial Bank of China announced last week that it would soon expand its operations from five to 10 cities. Bank of China, the first Chinese firm to launch a private banking business, already has centres in 15 regions.
All these banks want to hire the same people: relationship managers. “RMs are the hottest position to fill in this market. But private bankers here may not have strong product knowledge compare to their counterparts in the region because the scope of products they can offer is still limited, China being an emerging market,” comments Cherol Cheuk, director of banking at Hudson.
But just like in established centres such as Singapore, private banks in China only want to recruit RMs who have existing clients. Unfortunately for the banks, there isn’t a big supply of these professionals.
“Because the industry has only two years of existence in China, there is a shortage of RMs with significant portfolio,” says Gregory Rastello, an executive consultant at Talent2 Beijing.
Do the local and international private banks have similar recruitment requirements? “They are all looking for people who can bring in businesses within a short span of time. The only difference is that professionals joining Western banks should be proficient in written and oral English,” explains Rastello.
The need for local clients means private banking is not a great sector for expat Chinese returnees, says Cheuk.
But private banks will consider candidates from other sectors – such as retail banking, private equity or even SMEs – as long as they have their own networks, according to Rastello. RMs working in overseas China desks, especially in Hong Kong and Switzerland, are also sought after in the mainland.
“Given the constant increase of millionaires in China and the further sophistication of clients, the private banking sector is continuing to grow. The war to find the right talents will continue too,” he adds.