Barclays would need to offer large pay rises to hire relationship managers, if it relaunches its Asian private bank, say headhunters.
The British firm, which sold its Asian wealth unit to OCBC-owned Bank of Singapore just last year, is reportedly now considering basing RMs in Singapore and Hong Kong again. The earliest it could do this is January 2019, when its non-compete agreement with OCBC expires.
At least 15 to 20 RMs would be need initially in both Hong Kong and Singapore to restart Barclays’ private bank, says Rahul Sen, a former Merrill Lynch private banker, now head of wealth management at search firm The Omerta Group.
Achieving this level of headcount, which would still place Barclays outside the top-20 largest RM workforces in Asia, is likely to be difficult. “Wealth is growing in Asia, but all private banks here are in growth mode so the job market is competitive,” says Sen. “RMs may not want to join Barclays and may face a backlash from clients if they tried.”
Barclays would face challenges “regaining trust from RMs and their clients”, says Liu San Li, an ex-private banker, now head of banking at search firm IGS Asia in Singapore. “It would need to convince candidates that it’s now in it for the long haul, even though it’s just sold the wealth business,” he adds. “RMs would be concerned about job stability and clients would be concerned about another sale or a rise in the minimum AUM account threshold.”
Even if their clients were happy with the move, RMs would only consider joining Barclays if offered more senior roles with “huge jumps” in base pay, adds Liu. This would mean competing with other smaller private banks in Asia (e.g. LGT, VP Bank, EFG, and Safra Sarasin), which are regularly giving new recruits salary increases of 30% to 50%.
“It would take a lot of convincing and money to entice RMs to join a relaunched Barclays. The bank would surely need to pay above market average,” says Gary Lai, managing director at recruiters Charterhouse in Singapore. “Barclays would need to cut its margins to offer RMs a significant pay-out and to offer competitive lending rates to clients.”
“Size, reputation and product offerings are also key factors for success in private banking, so it would take a lot of investment into a product platform to make Asian bankers and their clients keen to move,” adds Lai.
Image credit: Janine Lamontagne, Getty