Why graduates with financial acumen will find a host of interesting jobs
Thursday 26 January 2006
If you long to rub shoulders with the fabulously wealthy - helping them manage their current millions while adding yet more noughts to their balances - then a career in private banking could be your dream job.
The clients of a private bank such as Coutts & Co - who include the Queen - SG Hambros or Butterfield can range from chief executives and pop stars to property tycoons and the landed gentry. They usually have a minimum of £500,000 in "liquid assets" to invest in stocks, shares, gold or bonds - that's after their luxury house or houses are taken into consideration - but many of the world's so-called "high net worth individuals" or HNWIs would consider half a million in readies to be mere pocket money.
With high taxes to pay, inheritance planning to worry about and, increasingly, a responsibility to re-route at least some of those millions to good causes, the banking needs of the truly rich go well beyond a mortgage, student debts and the gas bill.
Whether you are predominantly a relationship banker - where the job is to get to know the HNWI client and assess their specific financial needs - or work on the actual investor side, giving detailed financial advice on the best hedge fund or bond, a job in private banking puts you one step closer to the world of the rich and powerful.
Many graduates see financial services as a high-flying, well-heeled type of career, but few perhaps realise just how varied and cosmopolitan the finance sector really is - both inside and outside the high street.
Since the de-regulation of financial services, the retail banks have spread their wings from their traditional specialism of cheque books and savings accounts to offer a whole range of insurance, investment, corporate banking and mortgage products.
Lloyds, Barclays and other retail banks with a presence in the high street have been joined in this banking revolution by the less well-known private banks, by building societies and, most recently, by supermarkets. Most large retail banks and building societies have their own graduate-training programmes; designed to produce the bank managers, economists, tax advisers and retail bankers of the future.
Away from the high street, the financial world concentrated in the City of London encompasses another whole raft of possible careers. The City includes accountancy, asset management, capital markets, commodities, consultancy, corporate banking, derivatives, equities, hedge funds, investment banking and investor relations - and that's just the start of the specialisms to be found in the Square Mile.
While technology has transformed the entire financial services industry recently - via electronic trading and internet banking - a career in finance-based IT is often overlooked.
Yet if investment bankers, say, enjoy the machinations of finance in its broadest sense, financial IT specialists are employed to literally keep the wheels of commerce turning. The IT department of an investment bank is responsible not only for ensuring that the computers on the trading floor are up to speed, but that the bank's top-secret computerised client files can't be hacked into from outside. For the technology graduate or enthusiast, the opportunities to carve out a career in IT development, procurement, risk assessment, e-commerce or systems support are well worth exploring.
With so many career paths open to numerate graduates with a feel for business, the first sensible decision may be where to practise, rather than what to specialise in.
Although the financial services industry is still dominated by two huge centres - London and New York, each employing thousands of bankers, traders, analysts, managers and support staff - there are other important financial hubs too. In Asia these include Tokyo, Singapore and Hong Kong, while in Europe Frankfurt, Paris, Zurich, Milan and Madrid are among the big money hotspots. In the US, the choice is wider - Boston, Chicago, San Francisco, Houston or Atlanta perhaps.
Every year, graduates from Europe, Asia and the US enter the financial marketplace as trainees for global firms such as JP Morgan and HSBC. For would-be city high-fliers with an urge to travel, it's worth noting that such is the demand for financial acumen internationally that many graduates will nowadays be posted overseas, as a matter of course, within their first 18 months.
Merrill Lynch and Goldman Sachs send some or all of their trainees to New York to learn the theory of banking, while ABN Amro puts recruits through six weeks of training in Amsterdam.
For graduates hungry for big bucks and huge bonuses, a financial services career tends to mean investment banking - at a world-famous house such as Citigroup, Deutsche Bank, UBS or Bank of America. The investment banker's main job is to buy and sell shares, bonds and other financial products, to handle clients' often cut-throat mergers and acquisitions strategy and to help them raise the necessary cash for expansion.
Although a sharp, analytical brain is essential for all the number-crunching work required in investment banking, a confident manner and excellent communication skills are equally vital when you are persuading a canny, billionaire client to part with hard-earned cash.
Client-facing staff in financial services need well-developed people skills just as much as a good business brain.
Elizabeth Bird: 'Working with the rich makes me want to succeed all the harder'
Elizabeth Bird, a 24-year-old maths graduate from Oxford, is a relationship manager at private bank Coutts. Based in Manchester, her clients are predominantly entrepreneurs.
I was always good at Maths and my favourite toy as a child was a bank play set, so I'm not surprised at how my career has turned out. I don't have celebrities on my client list but around 100 individuals or families who have amassed a large fortune and need advice on how to manage it.
I wouldn't say I felt envious of their wealth, but working with rich people does make me want to succeed all the harder. Some of my clients started from nothing - with a market stall perhaps - and through sheer hard work and determination have managed to build up a fortune of many tens of millions of pounds.
Manchester is a great place to be at the moment and it reflects a big shift in the nature of wealth. While the rich would once have always expected to travel to London for their banking services, today's entrepreneur is just as likely to live outside the capital and to need good advice on the doorstep.
I see my role as being a trusted adviser and friend. Although I can bring in all sorts of different financial experts as the need arises, my key job is to establish what the client wants from his or her money today and in the future and how much risk he or she is prepared to take.
The social side of my job is pretty good. I sometimes get invited to client parties, but ultimately my job is more about helping clients manage their wealth than partying, even though it can be great fun just getting to know them.
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