The launch of a fifth pillar bank could generate jobs in the wake of recent redundancies
More than 6,600 roles have been slashed from the Big Four banks in the last year amid growing concerns about slowing economic conditions, according to the KPMG report, Major Australian Banks Full Year 2012. But there is a glimmer of good news: the creation of a new Macquarie-backed mortgage lender could open up new vacancies in retail banking.
ANZ and Westpac have trimmed the most jobs, but employees at all the major banks were targeted in a series of aggressive cost-cutting strategies. In the report, KPMG head of banking Andrew Dickinson warns finance sector professionals to brace for more redundancies as the Big Four come under pressure because of weak demand for loans and continuing concerns about the global economy.
So will the introduction of a possible fifth-pillar bank help to redress some of these headcount losses?
It was announced this week that Macquarie has joined forces with the Mark Bouris-backed Yellow Brick Road to compete with the big four banks in Australia’s mortgage market. The plan is to lure customers with discounted home loans aimed at undercutting rival banks. Bouris told The Australian: “This is a game changer that will take the Big Four head on.”
Whether the alliance eventually creates a fifth pillar in banking or not, it is likely to have a major immediate impact on hiring.
Yellow Brick Road has an existing network of 140 branches, apparently about half of the eventual network it is planning. Although there may be an existing sales force in place, the Macquarie partnership will require large numbers of staff to support its initial mortgage products.
These may include client-services, call-centre and broker-services staff, along with credit analysts, collections agents, applications processors, and marketing and product specialists within mortgages, says Andrew Hanson, director of financial services, Robert Walters.
“I would expect to see demand for risk and compliance professionals as well as project teams to help put in place the initial company plans and then to roll out the risk framework,” says Hanson. “While there may be a need for a variety of accounting functions, these may partly be covered by already existing group functions.”
It is likely that the new venture will target Big Four employees. “However, as headcount is already lean, the banks are running a tight ship and will be desperate to hold on to good staff,” says Hanson.
The move into home loans is reported to be the first step in an alliance that is expected to produce a full suite of banking and wealth management products, including superannuation.
Why join a fifth pillar bank?
For many jaded banking professionals, joining a new bank with new products and customers may be an attractive option. “There may be the lure of generous remuneration for customer-generating roles and the advantage of getting in early if the enterprise all goes well,” says Hanson. “The Macquarie brand is also still very strong in Australia.”
However, giving up existing job security is always an important consideration when joining any new business. Employees will be expected to hit the ground running and there is also the possibility that some roles may be based offshore.
Stuart Jackson, director, financial services, Hudson, says any new venture or joint venture is good for the market but agrees that existing Big Four employees may be hesitant to consider a move with the employment market so subdued. "However, there is good talent available with a wealth of experience – anyone impacted by headcount reductions would jump at the chance to challenge the Big Four's market share," he says.
