Think jobs in Asian private banking, think golf course schmoozing, product pushing and generally cashing in on the rise of the region’s rich.
But behind this glamorous front line, private banks in Hong Kong and Singapore are quietly bulking up their compliance ranks as they tackle a growing regulatory burden. This means more money and more jobs for compliance pros in the sector, and rising headcount costs for their employers.
The perfect profile for a 30% pay raise in private banking.
Private banks hire to serve rich Asians with $10 trillion to invest.
“Given the many new financial regulations, there is an insufficient supply of compliance professionals,” said Dr Dragon Tang, an Associate Professor of Finance at The University of Hong Kong. “And they are changing jobs more frequently than before.”
The candidate shortage in Asia means new compliance recruits are getting hefty pay raises of up to 30%, said Lucy Reith-Pert, a senior consultant at recruitment agency Ambition in Hong Kong. A new global wealth survey by RBC Wealth Management and Capgemini lists pay increases and additional recruitment among the main causes of a recent rise in compliance costs hurting private banks’ bottom lines.
Domestic, regional and international regulations are driving the compliance hiring. For example, at a local level, the Securities and Futures Commission of Hong Kong has been tightening the distribution process for structured products in the wake of a credit-crisis scandal involving Lehman Brothers minibonds, Dr Tang said.
Private banks in Hong Kong are also hiring Chinese regulatory specialists. “Many Hong Kong private banking clients come from mainland China, which is undergoing major regulatory reforms,” Dr Tang added. “And Hong Kong also needs to accommodate regulations from the US and the EU, such as the Dodd-Frank Act in the US.”
But while private banks can recruit overseas-based professionals for jobs specialising in Dodd-Frank and other global regulations, they are generally more interested in candidates who are familiar with Asian requirements and have relationships with Asian regulators.
“Private banking compliance officers with Asian experience will continue to be in demand because wealth management here is quite different to in other parts of the world, so it’s not an easily imported skill set,” said Suan Wei Yeo, a director at search firm Profile in Singapore.
Another headhunter, who operates in both Singapore and Hong Kong, singled out JPMorgan Private Bank as the most active recruiter in compliance – the US firm needs to support the new relationship managers it has hired in Asia over the last 12 months, he said. A spokesperson for JPMorgan in Singapore confirmed that it is hiring support staff in functions including compliance, legal, risk management, operations and client servicing.