Hiring good relationship managers (RMs) in the private banking industry is increasingly becoming an art rather than science.

Date: Nov 11, 2011          Author: John Koh

Keywords: Hiring, Recruitment

Hiring good relationship managers (RMs) in the private banking industry is increasingly becoming an art rather than science.

As a result, private banks which are relying on conventional wisdom are finding their recruitment strategies yielding less than desired outcomes. 

In the first part of this two-part article, I will look at the two-pronged approach of the conventional hiring method. 

The first approach is to engage with industry contacts to find out which private banker is currently well-received and garnering positive feedback from clients and colleagues.

This will be followed by trying to establish contact with that individual, either through an internal HR representative or by using the services of a headhunter.

The second approach recognises that outright poaching of a private banker through an internal source may not go down well with a competitor and could pave the way for future legal disputes.

Hence, the preference is to find a recruiter who is specialised in this field of hiring.   

Both approaches invariably converge to the next stage of assessing the suitability of the candidate, which typically starts with an initial discussion on client coverage, assets under management (AUM) and revenues – as well as plans for the next one to three years.

The business plan is key in documenting the specific client profiles, estimated net worth, targeted AUM and revenues which could achieved over the next one to three years.

Some banks go a step further to make sure their hiring decision is the right one by asking the candidate to participate in role-plays with their senior management, and using psychometric tools to assess the “character” make-up of the banker. 

Now let’s suppose the candidate passes the rounds of interviews and tests. Both parties will then sit down and discuss the terms of their engagement. The bank will reiterate the targets and seniority level of the hire, and the candidate will reassure his or her ability to meet those targets.

Once both parties reach an agreement, a job offer is made and the candidate will make sure he / she finishes all duties and obligations with the current employer before starting work with the new firm.

Does this sound too easy?

My next article will look at the reality of the situation, as private banks are seeing several pitfalls and risks involved in the above approaches.