Tenures in Asian private banking tumble by 40%. Here's why

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Asian private banking

Private bankers in Asia aren’t sticking around in their jobs for as long as they once did. As recently as 2013, a relationship manager would typically spend around five years at one bank, but  now average tenures have fallen by 40%, to about three years, according to a Singapore-based headhunter.

“While there are still RMs who remain at the same firm for almost their whole careers, those who move aren’t staying as long at each bank,” adds Jonathan Hollands, a managing director at search firm Carraway Group in Hong Kong.

This is partly a demand and supply problem. Over the past year several private banks in Asia – most notably UBS, Credit Suisse and Julius Baer – have announced plans to hire hundreds of new RMs.

Banks are largely filling these roles by moving RMs from other banks rather than, for example, by hiring graduates or promoting mass-affluent bankers.

But the sheer amount of roles on offer isn’t the only reason for excessive job hopping in Asian private banking.

“Some RMs are moving more often because they’re increasingly concerned about the strategic direction of their bank and are questioning whether it’s committed to private banking in Asia,” says Hollands.

This recent sense of anxiety follows the decisions of several banks to exit Asian wealth management. ABN AMRO has sold its business to LGT, while the regional wealth units of Barclays and ANZ have been taken over by Bank of Singapore and DBS respectively.

“And there have also been a lot of management changes in some banks recently – that’s another push factor. One RM told me that he’d had four managers in five years at the same firm,” says Hollands.

Moving frequently in private banking isn’t necessarily beneficial to your career, however.

“Compliance onboarding is becoming more onerous, and banks are doing all they can to make sure clients stay with them rather than move with the RM,” says Hollands.

“So RMs can experience a big drop in AUM if they don’t bring over as many clients as expected. If you’re managing US$300m and that drops to only US$80m in your first year at the new bank, your HK$2m salary now seems overinflated,” he adds.

This is fuelling a vicious cycle of job hopping as bankers are fired or resign prematurely because of the pressure to make money for new employers.

“RMs move mostly because of dissatisfaction with the ever increasing KPIs combined with the slow growth of their incomes,” says Liu San Li, a former Coutts private banker, now a client director in private wealth management at search firm EMA Partners in Singapore. “Many find it hard to survive in their current banks.”

Image credit: klazing, Getty

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