Pay for Private Bankers: Europe Catching Up to U.S.
While high net worth clients tend to favor private banks close to home, the search for the best talent in private banking crosses borders. The lure, of course, is pay. Read on to see what you can expect to earn in different financial markets.
U.S. and U.K: More Competitive
Earnings in these two core private banker markets are described as increasingly competitive, especially for individuals with the right attributes. Recruiters warn, however, that average salary ranges can be misleading as many individuals get less or, in many cases, substantially more.
In New York, Tony Riotto of the New York-based search firm Riotto-Jones Company says the old commission-only model is increasingly a thing of the past. Indeed, he says the base range for a private banker with 15 years experience has risen over the past few years from $150,000-$175,000 to $200,000-$250,000 with a bonus of "30% on new business with an annuity on revenue going forward."
In London Harry Pilkington at recruiter Armstrong International suggests a starting base for a private banker at VP/director level of 70,000-85,000 with bonuses up to 90%; Dudley Edmunds of search firm Culliford Edmunds Associates says top level private bankers can earn a base upwards of 140,000 with bonuses of 100%.
Continental Europe: Pay Approaching UK Levels
Search firms agree that all the main European countries lag the UK and US on private banker pay - Edmunds says this can typically be 10%-30%. Yet whilst local private banks continue to recruit locally, bulge bracket banks in particular are increasingly inclined to pay whatever it takes to get the right people - and that means salaries approaching London levels if recruiting across borders.
"If you want quality you have to pay for it: the European market is short of quality private bankers," says Edmunds.
Markus Zanola of Heidrick and Struggles in Zürich says Swiss salaries are probably the highest with base salaries starting at CHF120,000 for a junior rising through to CHF180,000-240,000 for a seasoned private banker. Bonuses are highly variable and linked to portfolio performance, but as a rule juniors will get CHF50,000 while senior banker bonuses can exceed their base.
Over the border in Italy, Sergio Zanetta at recruiter Proper Transearch in Milan says demand for intermediate and senior staff is strongest from small and large foreign banks, rather than local Italian ones. He suggests a private banker will start his career on a base of €30,000-€40,000, seeing this rise after a few years to €60,000-€100,000. Senior private bankers can earn anywhere between €120,000 and €250,000. Bonuses for juniors are paid on company results, for intermediates and seniors on new business volumes.
Salaries are similar in France and Germany. Edmunds at Culliford Edmunds suggests senior private bankers would be looking at salaries starting at €170,000-€190,000, with Germany the most dynamic market. "Germany's wealthy are becoming wealthier," says Frank Hoffmeyer of Heidrick and Struggles. "This means enormous potential for private bankers here."
Go East Young Man
For the truly ambitious private banker however, the real money is currently to be made in the Far East. Asia's continuing economic boom has spawned a new generation of wealthy individuals and the private banker market is struggling to keep up.
"For every private banker we recruit in Europe and the U.S., we are looking to employ 10-20 in places like Singapore. I anticipate the pace of hiring next year will be stratospheric, with salaries rising accordingly," says Armstrong's Pilkington.