Developing the new breed of all-round professionals

eFC logo

Gerry Cameron, TMP Worldwide's head of private banking in New York, says that this is a trend set to continue: 'The wealth management industry is going to grow over the next few years. The wealth has already been created. For private banks it is just a question of positioning themselves to manage it.'

Among those entering the market are UK retail bank Abbey National, while Merrill Lynch has declared an intention to join soon.

Many of the newcomers are pitching their services at a younger, more entrepreneurial clientele, seeking help in offsetting the risk inherent in highly concentrated equity holdings. What they want is young bankers, familiar with complex instruments like derivatives. The head of HR at one leading private bank says that he would be keen to take on more corporate financiers, partly because they have already developed relationships with the chief executives that are the bank's clients. John Costigan, head of HR at the Coutts Group, echoes this: 'We would always look favourably on applications from investment bankers.'

Christian Sulger-Büel, a headhunter specialising in private banking, says the perfect private banker is a rare creature. In addition to investment banking experience, product development knowledge, a good list of clients, strong IT skills and two or three languages, private bankers need very strong relationship skills.

Charm is crucial to success. Such is the importance of charisma that it can offset deficiencies in other areas. Costigan at Coutts says: 'What we are trying to achieve is an all-round professional private banker who can blend the old-style credit and lending activity with all-round investment and taxation advice.

'I'm not sure where this new breed comes from. In practice, we train people who meet one or two of these criteria and who have the personal skills to relate to clients.'

From an investment banker's point of view, the biggest obstacle to moving into private banking is likely to be money. Salaries rarely exceed 100,000, and despite recent pay rises the differential between private bankers' and investment bankers' packages has increased.

However, rises have been more dramatic in the US, where private bankers' pay has traditionally been linked to revenue generation. In New York, Gerry Cameron says that outstanding performers are now on seven figure sums.

Nevertheless, relatively low pay in private banking makes the sector unappealing to hot shots from corporate finance. As a result, a recruiter in one private bank says that the most successful former investment bankers are those that were talented but undistinguished in their former career.

Talent is important, though, warns Sulger-Büel: 'Good people will be good everywhere. A failed investment banker will not be a successful private banker.'