How Singapore's private banking sector is dealing with a talent crunch
- POSTED: 08 Aug 2014 00:06
As Asia becomes a key generator of wealth in the world, Singapore's private banking sector is managing more of those new dollars. However, the burgeoning growth of the private banking industry also means that there is a shortage of skilled talent.
SINGAPORE: Singapore is the world's fastest growing wealth management centre. According to latest data from the Monetary Authority of Singapore, assets managed by Singapore-based asset managers hit S$1.6 trillion dollars in 2012 - or a jump of 22 per cent from the previous year. That rate of growth means that experienced and well-qualified wealth managers are in short supply.
Ms Cynthia Teong, CEO of Wealth Management Institute said: "To this point, I think our stakeholders at Temasek and GIC had that foresight ten years ago to establish the Wealth Management Institute as being the first in Asia. Since 2004, when the first programme was launched, we have trained almost 7,000 individuals, and a high percentage of these are actually practitioners."
The Wealth Management Institute offers short programmes lasting five weeks as well as a year-long Masters of Science in Wealth Management. It has helped non-practitioners - from backgrounds as diverse as music and pharmaceuticals - make a successful career switch.
There was a time when the private banking industry only took in finance professionals - and in some cases, only those with experience in other banking functions, such as corporate banking, treasury or asset management.
"I guess up to the last five years, due to the subprime (crisis), it's just anybody who wants to be a private banker. And so what you have now are a lot of private bankers. But if you're looking for the typical definition of a good private banker, then it's very hard to find good ones," said Mr Ang Eng Hieang, Executive Director at Swiss boutique bank Bordier & Cie.
One new training firm, Temaswiss Wealth, hopes to fill that training gap for private bankers here by bringing in the Swiss apprenticeship model.
Mr Ranjan Chakravarty, CEO of Temaswiss Wealth, elaborates: "Junior professionals are taken in to the banking sector, they work three days a week, and attend classes two days a week. These programmes range from 18 months to three years, wherein they are rotated through all divisions of a bank, and also are given the benefit of a dedicated mentor. So when they emerge from the three years, they offer a bench strength to the banking sector, which is signiicant."
For Bordier & Cie, the talent crunch and the high cost to income ratio in the private banking industry means it just has to work smarter.
Mr Ang said: "Realistically, we just have to be more efficient in the way we use manpower and in the way we do our business. Say for example, we do not create our own factory to produce (financial) products, so that takes away the need for a lot of manpower. We leverage the strengths of our third-party partners, which could include the fully-integrated banks, and the specialist investment houses."
Amid the talent crunch, the industry also has to be mindful of regulatory changes in several areas - from tax evasion rules to data privacy laws - and update its training programmes accordingly.