Five Years After Lehman: Industry Evolution
While the collapse of Lehman Brothers five years ago rocked not just the City but kick started a global financial crisis, the consequences have resulted in a number of positives for those who have forged their career in financial services. Richard Webber, Director of Financial Services at Twenty Recruitment, has come up with five reasons why career bankers should still have a smile on their faces.
Life after lehman as a career banker– five reasons to be cheerful five years on
Regulatory Changes Creating New Opportunities
Increased regulation has meant that that banks have had to upgrade systems, strengthen their stress testing and improve corporate governance. The result? Increasing demand for professionals in areas such as compliance, risk, regulatory reporting and valuations. There is also the issue that compliance has changed – and with that so too has the range of skills needed. The old style box ticking ‘secret policeman’ often seen as a hindrance to the business just won’t cut it anymore. Compliance professionals need to be tough cookies, not box tickers in ivory towers. They need to be able to stand up to the sales and trading teams and demonstrate not only their technical expertise but also their relationship management skills. That means taking a strategic and business advisory view in terms of not just implementing the regulations but working with business heads to ascertain what the impact of the regulations will be on the business. Hot areas include client assets and advisory roles around European Infrastructure Market Regulations (EMIR) and Foreign Account Tax Compliance rules (FATCA).
Work Culture Shifts and Better Balance
Changing Priorities: While there is still a bullish investment banking culture in the front office, in non-revenue earning roles there is far less of a culture of presenteesim leading to a better work/life balance. Banks are now paying a far greater proportion of remuneration as base salary and so the pressure to work longer hours in order to earn that big bonus has dissipated. Additionally, a lot of the processing work within finance and operations which sometimes necessitated long hours has been offshored.
Expanded Roles in Mid-Tier Institutions
Mid tiers’ emergence: There is now far more diversity of opportunity which offers bankers the chance to get broader experience. The gloss and shine has gone off the major Wall Street banks as professionals increasingly turn to mid tiers and emerging market banks for their careers. These institutions have not been as constrained by sovereign debt or sub-prime and can offer interesting and varied careers.
Banking Industry Consolidation Trends
Consolidation: The huge amount of consolidation in the market – Bank of America and Merrill Lynch, Bear Sterns and JPMorgan, RBS and ABN, Dresdner and COMMERZBANK-RESULTS-6a9eabc8-8eba-4148-aa56-8c955a2d57b3>COMMERZBANK-LAYOFFS-a8b75e55-254b-40e8-9290-ad5b828929db>Commerzbank – has been very good news for contractors. Career contractors in area such as Business Analysis and Project Management have been able to cash in on some of the major offshoring and onshoring projects as firms look to reduce their London cost bases. While much of the offshoring has gone to obvious locations such as India and Asia; there have been European nearshoring projects in locations such as Galway, Budapest, Birmingham, Chester and Glasgow.
Sticking to your knitting: As the banks now have an obligation to shore up their balance sheet, we have seen a decline in high margin/low volume trading. There has been a particular growth in wealth management as high net worth individuals look at maintaining their income against a backdrop of low interest rates which has led to a demand for wealth management professionals with a demonstrable track record.
While the collapse of Lehman Brothers five years ago rocked not just the City but kick started a global financial crisis, the consequences have resulted in a number of positives for those who have forged their career in financial services. Richard Webber, Director of Financial Services at Twenty Recruitment, has come up with five reasons why career bankers should still have a smile on their faces.
Life after lehman as a career banker– five reasons to be cheerful five years on
Increased regulation has meant that that banks have had to upgrade systems, strengthen their stress testing and improve corporate governance. The result? Increasing demand for professionals in areas such as compliance, risk, regulatory reporting and valuations. There is also the issue that compliance has changed – and with that so too has the range of skills needed. The old style box ticking ‘secret policeman’ often seen as a hindrance to the business just won’t cut it anymore. Compliance professionals need to be tough cookies, not box tickers in ivory towers. They need to be able to stand up to the sales and trading teams and demonstrate not only their technical expertise but also their relationship management skills. That means taking a strategic and business advisory view in terms of not just implementing the regulations but working with business heads to ascertain what the impact of the regulations will be on the business. Hot areas include client assets and advisory roles around European Infrastructure Market Regulations (EMIR) and Foreign Account Tax Compliance rules (FATCA).
Changing Priorities: While there is still a bullish investment banking culture in the front office, in non-revenue earning roles there is far less of a culture of presenteesim leading to a better work/life balance. Banks are now paying a far greater proportion of remuneration as base salary and so the pressure to work longer hours in order to earn that big bonus has dissipated. Additionally, a lot of the processing work within finance and operations which sometimes necessitated long hours has been offshored.
Mid tiers’ emergence: There is now far more diversity of opportunity which offers bankers the chance to get broader experience. The gloss and shine has gone off the major Wall Street banks as professionals increasingly turn to mid tiers and emerging market banks for their careers. These institutions have not been as constrained by sovereign debt or sub-prime and can offer interesting and varied careers.
Consolidation: The huge amount of consolidation in the market – Bank of America and Merrill Lynch, Bear Sterns and JPMorgan, RBS and ABN, Dresdner and COMMERZBANK-RESULTS-6a9eabc8-8eba-4148-aa56-8c955a2d57b3>COMMERZBANK-LAYOFFS-a8b75e55-254b-40e8-9290-ad5b828929db>Commerzbank – has been very good news for contractors. Career contractors in area such as Business Analysis and Project Management have been able to cash in on some of the major offshoring and onshoring projects as firms look to reduce their London cost bases. While much of the offshoring has gone to obvious locations such as India and Asia; there have been European nearshoring projects in locations such as Galway, Budapest, Birmingham, Chester and Glasgow.
Sticking to your knitting: As the banks now have an obligation to shore up their balance sheet, we have seen a decline in high margin/low volume trading. There has been a particular growth in wealth management as high net worth individuals look at maintaining their income against a backdrop of low interest rates which has led to a demand for wealth management professionals with a demonstrable track record.
