I’m now a fairly senior private banker, but only three years ago I was working as an associate in Asian investment banking. While I hadn’t advanced high enough to fully reap the financial rewards of IBD, under no circumstances would I want to return to my former job.
Since the financial crisis investment banking has, of course, retrenched tremendously, while at the same time many wealth managers have been expanding, particularly in Asia. Wealth is a growth sector and will continue to be one now that the second-generation is taking over family businesses in emerging markets.
But that contrast isn’t the reason why I moved – I actually prefer the work.
In investment banking, I was spending far too much time doing boring PowerPoints that my colleagues would present to clients. In private banking, I got a lot more client interaction from the outset and I now deal with senior people, both internally and externally. I’ve just had a meeting with a CEO of a client company and the head of oil and gas in our investment bank, for example.
I have direct interaction with decision makers and I can drive client relationships in the way I want to. I’m no longer stuck in the background, one of many associates helping out on a larger transaction. I’m now the person guiding things from origination to execution, and I’ve reached this level quicker than I was on course to in IBD.
Private bankers are playing a more prominent role in my firm, a large US bank, and in other banks which boast both wealth and corporate finance arms. If an emerging company is planning an IPO, for example, the business owner’s private banker will probably hear about it first, or even recommend it.
At the investment bank I worked for, my team dealt with a lot of buy-side clients, but once the deal was done the risk transferred to them. I could wipe my hands of whatever was sold; I had no tangible interest in its future success.
Now, in private banking, I own the risk. Taking on personal risk isn’t for everyone and it’s certainly challenging, but it’s a key reason why I enjoy my job. I’m accountable for the success of my clients’ investments long-term. My year-end revenue targets and bonus depend on them. I have a lot more skin in the game.
In investment banking, my (or should I say my team’s) clients were industry peers, sophisticated investors. Now they are private individuals, albeit wealthy ones, so there’s a lot more client hand-holding involved in my job. I enjoy this side of the role too because I’m relationship building over the long-term rather than working deal to deal.
As you probably know, investment banking is famous for the pyramid structure of its workforce – there’s typically only one MD per team and a lot of people under them. The hierarchy is flatter at my private bank – there are more people at a senior level working together.
And there’s potentially more long-term job stability, if you perform well enough and can handle the pressures of revenue targets and compliance. I’m looking after my clients' needs for the next 10 years and beyond – a potential IPO or succession planning for their family, for example – not just for the next transaction.
I work very hard, but the work-life balance is better than in investment banking. I get more support from colleagues in product development and other departments, leaving me time to concentrate on developing the business.
In investment banking, I was told by my bosses to always leave a toothbrush and a spare shirt in the office in case I had to work overnight. Now my late nights are largely confined to client dinners.
Jeremy Han (we have used a pseudonym to protect his identity) is a relationship manager at a US bank.
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