The demand for private banking staff is forecast to remain strong for the foreseeable future, forcing up remuneration packages as demand out...

The demand for private banking staff is forecast to remain strong for the foreseeable future, forcing up remuneration packages as demand outstrips supply, according to London-based executive search specialist Gibson Tullberg. But strong demand is creating its own set of problems. Most wealth management businesses have ambitious growth plans and many have failed to spend budgets allocated for the current hiring year, according to Gibson Tullberg. This is bound to place considerable upward pressure on demand and remuneration. But the increasing number of large guaranteed bonus structures have inflated many candidate expectations, says the head hunter. “Whilst employees can see this as encouraging, it also makes employers examine what they expect from a hire and over what time period,” said Tim Gibson, managing partner at Gibson Tullberg. “If the package is too high, both parties risk tough discussions if delivery has been problematic or specific conditions construe to make client attraction difficult.” Another potential problem for wealth managers, says Gibson Tullberg, is the need to satisfy existing employee’s expectations that may be undermined, or least perceived to be undermined, by the arrival of new hires. Research from the head hunter found that the majority of private bankers want a more entrepreneurial relationship with their firm whereby the banker has a direct interest in business execution, measured by asset under management accrual or revenues. “The discretionary bonus is now confined to the opaque ‘retail’ banking models or global players who, whilst they may have a great name, have to appease major shareholders first and employees second,” said Matilda Tullberg, the other half of Gibson Tullberg. “It’s still a case of cross your fingers and await the brown envelope in many cases.” Gibson Tullberg also sees considerable pressure on wealth managers having to build up teams and business quickly. “It is common to find a two-year project to add 20 frontline staff each year and grow assets by 50 per cent,” said Tim Gibson. “But, given the lead time in identifying candidates, conducting interviews, closure and then notice periods, the actual impact of new hires can only be felt 12 months later.”