The ongoing battle for Scotland's private banking expertise

As relatively new wealth management firms battle for assets up for grabs as Scotland's moneyed classes lose faith with the country's traditional stalwarts, private bankers north of the border continue to move towards new job opportunities.

Traditionally, Adam & Co, owned by RBS, and Bank of Scotland have dominated Scotland's wealth management landscape. But with the latter off-loading a chunk of its business to Rathbone Partners last year and the former struggling to keep both clients and staff, a battle for talent and new assets has emerged.

In recent months there has been further movement, after significant recruitment drives earlier in the year, which raised the issue of a dearth of talent in Scotland.

Last week Standard Life Wealth revealed that it had poached Craig Joiner from Cornelian Asset Management as client portfolio manager, while Brewin Dolphin lifted out a team of seven from Adam & Co for its Glasgow office in October.

"Many of the traditional stalwarts of Scottish private banking have had their reputations hit, and smaller players are hoping to take advantage of this," says Karl Von Bezing, director at the Scorpio Partnership. "By building teams locally, they are also in a better position to access to pools of wealth neglected by the larger teams."

While there's an element of simple market churn, with a number of wealth managers selectively hiring and others being forced to replace, other firms are expanding.

Cazenove Capital Management, for instance, recruited Niall Kennedy as director in its Edinburgh office in September. Andrew Ross, the firm's chief executive, said it was going to "develop significantly our presence in Edinburgh".

Barclays Wealth also added two to its portfolio management team in Scotland in October, Eline Lofgren and Sripad Gopala, while Clydesdale has brought in five new private bankers this year to meet the swell in new clients.

"It's a strange scenario, because it's not as though the pool of wealth in Scotland is growing, but just that more firms are chasing it and need the best people onboard," says Saftar Sarwar, managing partner of Kingdom Capital Partners in Edinburgh. "A number of firms managed wealth up here anyway, and it's a natural progression for them to open a small Scottish office and look to the local market for new recruits."

Reflective of this is the fact that bigger base salaries haven't really been on offer. Instead, new hires are being incentivised to bring assets and clients across with them and are promised lucrative bonuses for doing so, suggests Sarwar.

"There's no short-term salary inflation, but rather medium-term incentives for capturing new revenue streams," he says.