New Report Cites Private Banker Shortage
Wealth management CEOs are looking for a few good client-facing private bankers. Well, make that more than a few.
PricewaterhouseCoopers recently joined the drumbeat of authoritative voices warning that an industry-wide shortage of capable private bankers threatens the growth of the private wealth management sector.
In its bi-annual survey of 265 private banking/wealth management firms released last month, the worldwide business services firm emphasized that the need to recruit and train more effective, client-focused wealth managers has become a top priority in executive suites.
"Put bluntly, there are simply, not enough quality people to support the market's anticipated growth," the report's 60-page executive summary states.
Banks pursuing asset growth targets in the teeth of the shortage are expected to push up compensation "by far more than inflation," PWC says.
It says the shortage is greatest "for experienced individuals who can work at the upper end of the wealth pyramid." One in four openings for wealth managers has remained unfilled over the last 12 months, according to the report.
The conclusions align with other recent surveys that point up strong growth opportunities for private wealth management but urge greater efforts to expand the ranks of client-facing bankers. For example, London-based Scorpio Partnership, when unveiling its own private banking survey last month, also called upon firms to focus on hiring and training new bankers and sharpen their focus on serving clients.
CEOs who took part in the PWC survey rated only 17 percent of their firms' client relationship managers (CRMs) as having "very high" ability to meet client needs. Just 19 percent said their organizations are very good at attracting and retaining top bankers. At the same time, the demand for new CRMs is expected to swell 32 percent in the next two years, growing 57 percent in the Asia-Pacific region.
"Wealth managers must get serious about HR," PWC says. "Unless wealth managers address the shortage of CRMs, and improve their skills and core competencies, they will not achieve their growth expectations."