Private banks in Singapore and Hong Kong make most of their new hires and promotions in the first quarter. But think twice before you take on a more senior role – you may not last too long.
Team-leader positions at large private banks in Asia are increasingly at risk this year, even as the same firms recruit rank-and-file relationship managers.
“Non-producing execs are looking more vulnerable as cost-conscious banks try to reduce management layers,” says former HSBC and Coutts banker Amod Jain, now a consultant at recruiters Morgan McKinley in Singapore. “I’m now telling all my senior MD-level bankers to never give up their client books. I keep reminding them: in these times of tight margins in Asian private banking, you’re only as good as your clients.”
UBS, Asia’s largest wealth manager, is ahead of the game as usual. It started thinning out its Asian upper ranks in mid-2016 by making scores of non-client-facing MDs and EDs redundant, including country heads (who managed about three or four desk heads), and desk heads, who were in charge of about eight to 10 RMs.
Now the expectation is that other large private banks (the likes of Citi and Standard Chartered) will follow suit in 2018, say headhunters. “The boutique banks already have flatter management structures,” says former Merrill Lynch private banker Rahul Sen, now head of wealth management at search firm The Omerta Group.
“It’s about eliminating unnecessary managerial staff to keep a bank flat and lean, and improve ROI. It saves costs quickly on a large scale,” says Sen. “Instead of having an exec look after three to five client-facing RMs, for example, a bank could merge two teams, let go of one manager, and get the remaining boss to manage the larger team. Managers in private banking can sometimes become paper pushers and admin heads rather than business heads.”
This is also a trend outside of Asia. Credit Suisse has already started removing managerial layers from its Swiss private client business. Serge Fehr, head of Swiss private and wealth clients, said earlier this week that supervisors in Switzerland will soon manage seven people – the current average is 4.2. This change does not apply in Asia Pacific, says a source close to the bank.
How to avoid the axe if you’re running a team? Be a ‘producing manager’, who looks after clients as well as colleagues. “Pure desk heads managing fewer than five RMs are particularly vulnerable this year, so always keep your best clients with you as you build your team,” says Sen. “Being a producing manager is always better than just being a pure team leader, unless you’re managing a big team of more than 12 or 15 RMs.”
Image credit: Masafumi_Nakanishi, Getty