Salary survey: Private bankers in growing demand

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A survey of 30 private banks in London shows that they expect the number of client-facing bankers working for them to soar by 27% by 2005 - up from 895 now to 1,221.

The survey was conducted by the search firm Norman Broadbent, which concluded that

"salary inflation is predicted to continue."

It found that directors in private banking currently earn average salaries of 121,000-127,000. Their cash compensation totalled 162,000-168,000.

Private bankers with five to 10 years experience earned average salaries of 73,000-79,000, with total cash compensation of 98,000-104,000.

Those with three to five years experience earned average salaries of 48,000-54,000, with total compensation of 63,000-69,000.

About 70% of the firms said they normally paid a bonus that was less than base salary, while 30% paid a bonus above base salary.

Norman Broadbent added that banks would have to continue to meet staff shortages by looking outside private banking. They would also have to become more flexible about how they structured pay packages.

Half the banks said that at the moment they were recruiting from private client asset management, from where skills were seen as easily transferable.

The law was also a popular background, favoured by 37% of banks. Institutional asset management was slightly less favoured, at 33%. "Not all candidates with an institutional background are able to adjust their style sufficiently well to be successful in the private client arena," the report said.

Other recruitment sources, tapped by 20%-30% of respondents, were investment banking, management consultancy, venture capital and private equity.

Some heads of private banking said they would not trust a candidate from another bank who offered to bring a book of business, as they would be likely to behave the same way again.

One respondent to the survey commented that in his experience, no more than 20%-30% of a promised book of business was ever successfully transferred.

More than two thirds of the private client portfolios held by the banks exceeded $1 million. More than a fifth exceeded $5 million.

Almost a third of respondents to the survey had less than 10 client-facing private bankers on their staff. Just 14% had more than 50 such staff.