Tidjane Thiam, who starts as the new CEO of Credit Suisse in June, is expected to grow the bank’s wealth management arm in Asia.
Credit Suisse has, however, been plotting a big expansion in Singapore and Hong Kong before Thiam's appointment. Its private bank employed 490 relationship managers (RMs) in Asia at the end of 2014, up from 440 in 2013, according to a league table from Asian Private Banker released last week. While this is the second highest headcount in the sector region, it’s still well behind that of UBS, whose front-office workforce increased 15% over the same period to reach 1,186.
Credit Suisse’s Asian hiring in the next 12 months won’t get it anywhere near to bridging the RM gap with its Swiss rival – especially in a sector ravaged by skill shortages – but headhunters we spoke to tip Thiam to ramp up recruitment nonetheless.
If all this is making you contemplate a private banking career at Credit Suisse in Asia, here are a few pointers to help you land a job there and thrive after you join.
The main stumbling block to joining Credit Suisse in Asia is that too many of your clients may already have some of their money managed by the firm – it’s common for wealthy Asians to use several private banks. “This is a particular problem at CS because its reach is so wide compared to most banks in Asia,” says Clarence Law, a Singapore-based business advisor in private banking. “If 70% of your clients bank there and already have a good RM there, why would they hire you and why would you apply?”
While Credit Suisse does grow its own talent in Asia – private banking assistants eventually morph into fully-fledged RMs – its external hiring is focused on poaching senior private bankers (directors and MDs). Junior RMs lack the client base to help the firm boost its market share in Asia. Credit Suisse was the third-largest manager of Asian private wealth in 2014, with client assets of US$154bn – still a long way behind Citi (US$255bn) and UBS (US$272bn), according to Asian Private Banker. “Thiam will mainly want experienced people to help it catch up with these competitors,” says Rahul Sen, head of private wealth management at search firm The Omerta Group in Singapore.
Law tips Credit Suisse to hire more senior RMs whose clients each have assets of about US$15m. “It has the ultra-high-net-worth segment, assets over US$30m, already pretty much covered in Asia, so it will go for bankers with clients just below that mark, where it’s seen rival UBS have a lot of success,” says Law.
If most of your private clients happen to be expansionist business owners, Credit Suisse will want to hear from you. “Private banking is a very competitive market in Asia, so Thiam will need to exploit all of Credit Suisse’s advantages in order to attract RMs,” says Law. “For example, private bankers serving Asian entrepreneurs should be attracted to CS because of its large range of business products. It can offer structured finance, shipping finance – boutiques can’t do that.”
Although analysts expect Thiam to slash the size of Credit Suisse’s investment bank, including in Asia, private bankers will continue to work closely with their IBD counterparts who survive the cull. “Credit Suisse is brilliant, better than all of its rivals, at creating a working bridge between investment banking and private wealth – it’s one of the main attractions of working there,” says Sen. “The bank has a team of ‘client solution partners’ who direct RMs to the right IBD guy – whether that’s in ECM, FX, ECM – to help out their client. You might only do two or three of these cross-selling deals a year, but you get recognised for it, it goes into your revenue pot.”
Private banks typically calculate bonuses based on a percentage of an RM’s annual revenue minus their base pay – and as we reported in January, both Credit Suisse and UBS pay in the lower range in Asia: 8% – 12%. “You’re fed an excellent platform and product suite and you sometimes have clients referred to you as well,” a Singapore headhunter, who asked not to be named because of client confidentiality, told us previously. “UBS and CS bankers are told they’re privileged to be part of these firms and should accept a lower bonus percentage. But your total compensation doesn’t come down too much as you can build larger assets and attract a bigger wallet share from your clients due to the superior platform.”
Credit Suisse’s strong brand, growth ambitions and product platform may sound appealing, but the bank is nearly as adept at losing RMs as it is hiring them. “Thiam’s leadership may well help change this, but CS has been a bit of a revolving door in Asia recently,” says another headhunter in Singapore who also asked to remain anonymous. “It has a large team of in-house recruiters here who’ve brought in some pretty average RMs – sometimes using big salary hikes – in order to meet hiring targets. Not all these people have performed well in their first year.”
“Despite the many clear pluses about working at CS, I do consistently hear from private bankers there that they spend too much time fighting internal political battles,” says the anonymous headhunter. “Since they’ve hired so many people recently and turnover has been quite high, it’s become a very competitive place to work.”
Credit Suisse did not immediately respond to an enquiry about its Asian hiring plans.