The demand for project-finance and structured-finance bankers has been on the subtle rise over the last three quarters in Asia. This hiring increase has been fuelled by the need to expand infrastructure investment in Asian economies to cater for the needs of a growing population.
The emerging Southeast Asian (SEA) economies of Indonesia, Vietnam, Thailand, Philippines and Myanmar are poised for growth in their infrastructure investment – for example building power stations, improving and extending railways and highways, upgrading ports, and building hospitals and telecommunication systems.
Meanwhile, the more mature capital markets of Singapore, Australia and Japan are well placed to tap into financing opportunities in these economies. In Singapore, the banking hub for SEA, I see rising demand for project-finance folks who are based in the city state but originate and execute deals across the region.
So which type of banks are hiring in Singapore? Recruitment isn’t dominated by the bulge bracket, but by banks who have both a deep-seated and near-term focused growth strategy in Asia. In other words: Singaporean banks, Japanese banks and Australian banks.
Salaries are attractive. A banker with 10 to 12 years’ experience – likely in their mid-30s at VP or director level – can command US$10k to $13k per month in base pay, with a performance bonus of 33% to 75% of their annual salary. So that works out to about $155k to $270k in total compensation per year. Of course, the bonus amount will largely depend on deals done, but 75% is not uncommon in a good year.
The salary increases paid to project finance professionals when they move companies are also slightly higher than for most other banking roles – they can command 20% to 25% in the current market.
In comparison to other bankers in Asia, project finance professionals tend to have longer and more stable tenures because most find their work interesting and meaningful. They finance actual structures and projects and it can be fulfilling to drive past an airport, sports hub, school or power plant and say : “I worked on the financing of this”.
Their professional community is also tight knit. While they can be divided into sub-sectors like energy, power, transport or social infrastructure, most will know each other because they interface on deals all the time.
What skill and competencies are required in this field? Because projects can be at different stages of their lifecycle, a project financier can be analysing and structuring the deal, reviewing legal documents, reading research and technical reports, facilitating meetings, or doing a site visit. Project-finance folks are well-rounded, as they usually originate, structure, execute and oversee a deal end-to-end. They need strong analytical and credit skills, an eye for detail, and the tenacity to pour over thick sets of legal documentation and research reports.
Being able to work collaboratively with external parties, including lawyers, other banks, government or regulatory authorities, and corporates, is also crucial. Project-management skills, involving tracking, reviewing, issue resolution and reporting, are also required as infrastructure projects usually take several years to complete.
There have been cases of banks hiring corporate lawyers who have worked in infrastructure finance because their legal training and understanding of contract law are valued. Other roles which can provide a base for a transition include: credit analysts who are keen to take on more front-office origination work; coverage bankers strong in credit and focused on clients in the energy, power, transport and logistics sectors; and bankers in debt capital markets.
More often than not, banks take on junior analysts and train and ‘grow’ their own talent, rather than ‘buy’ them. However, with heightened demand in project finance, I see more bankers from European banks moving into local or regional banks in Singapore. This trend will likely continue for the next 12 months.
Angela Kuek is the director of The Meyer Consulting Group, a Singapore-based search firm.