"VPs and directors in banks have become useless. The skills are all offshore"

I've worked in banking for 15 years, and the longer I stay in this industry, the more irrational and poorly run it becomes. 

If you survive in investment banking beyond a five or six-year period, you will likely become a vice president (VP}) and then a director. At this point in your career, you'll be making very good money, but it's not always clear why. 

If you work in M&A you will prove your worth by originating business. But if you work in other areas, like corporate banking or syndicated loans as a mid-ranking banker, you may well not bring any business. Nor will you be engaged in fundamental analysis, most of which has now been offshored to analytical teams working in centralized functions in low-cost locations.

So, what will you do? At many banks, the role of VPs directors today is primarily to act as a post box. - You get the offshore centre to do the work and you take the credit. Old school managing directors (MDs) haven't caught up with the game and don't understand how much things have changed. The excellent analysts in the centralized functions have no visibility, so the person running the post box can easily seem to be the critical component in the system. They're not. And yet they're promoted year after year.

While skills in London, New York and Hong Kong are being hollowed out, people offshore in the centralized functions are expected to do more and more. You have analysts in London who don't know basic corporate finance, but people in the centralized functions are expected to know the technicals of every product, plus accounting, regulation and the bank's policies. Despite this, they almost never get promoted beyond VP. 

The market doesn't know the names of the brilliant people offshore. The managing directors don't know who they are and HR don't understand the situation. 

The people in the major financial centres protect their own. At the bank I currently work for there are 10 MDs doing duplicate work across the same country, product and sector. They all have their favourite VPs who they want to promote to director. None of these VPs has respectable technical skills. Each of them specializes in dumping on the centralized offshored functions. The situation is crazy. No one seems willing to call it out. 

Lalita Ghosh is a pseudonym

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