Boyden Executive Search

As private banks in Singapore continue to increase their headcounts, it’s increasingly important for relationship managers to know how their compensation compares to the market average.

By Simon Mortlock

This article was originally published on eFinancial Careers website. Click here to view the original article.

As private banks in Singapore – most notably HSBC and Julius Baer – continue to increase their headcounts, it’s increasingly important for relationship managers to know how their compensation compares to the market average.

If you’re wondering whether your current private banking salary in Singapore is above or below par, we've averaged out minimum and maximum base salary data from several recruitment firms to produce the table below. And we’ve done this across five broad levels of seniority (job titles in private banking differ from firm to firm – some include the term “director” within ranks two to four, while others prefer “VP”). There’s also a table for bonuses at the bottom of this article.

Private banking salaries in Singapore

Private bankers who are staying with their current firms shouldn’t expect a large rise in their compensation in 2018/2019. “Most bankers in Singapore aren’t optimistic about bonuses and internal pay rises,” says Lucas Yeo, head of banking and finance at recruiters Tangspac in Singapore. “The investment market in 2018 hasn’t been favourable, leading to some lower revenue numbers compared with 2017.”

It’s a different story for those who are moving firms. “As pay remains steady from last year overall, banks that are hiring are offering attractive increments to get mid and senior-level bankers to join them,” says Andrew Zee, principal consultant in private banking and wealth management at recruiters Selby Jennings in Singapore.

The average pay rise for RMs moving between banks in Singapore is about 20% to 25%, say headhunters. Boutique private banks, however, typically offer more generous increases, primarily to attract new RMs who might otherwise be put off by their limited platforms. EFG, LGT, Safra Sarasin, UBP, and VP Bank – for example – have been hiring.

The job market in Singapore private banking remains tight, especially in the ultra-high-net-worth segment. “Pay inflation for new recruits is driven by a hunger for AUM,” says Yeo. “Banks are constantly on the lookout for new RMs who can bring books with them, and the war for talent is ongoing.  Because Asia is the fastest growing region for wealth growth, there’s a severe talent crunch here.”

The salaries of newly hired RMs are typically tied to the proportion of their current clients’ AUM they can bring to the new bank, says Liu San Li, a former private banker, now a business partner at wealth management firm Avallis. “Only EDs and MDs are able to get high increments that are not necessarily tied to AUM commitments,” he adds. “Hiring a senior banker is like striking the jackpot, so getting them recruited is more important that negotiating AUM.”

But there’s a potential downside to rampant pay inflation in private banking – if you land a lucrative new job, you will face onerous new targets. “Private banks realise they need to pay top dollar to recruit and retain the best bankers in Asia, but at the same time, non-performing bankers are being let go quite aggressively,” says former Merrill Lynch private banker Rahul Sen, now a global leader in private wealth management at search firm Boyden. “Newly hired bankers are given about 18 months to two years to break even or get near, but after that the cuts can be quite drastic.”

Private banking bonuses in Singapore

Your private banking bonus percentage in Singapore depends more on which type of bank you work for than how senior you are – although MDs are more likely to receive bonuses at the maximum level for their firm than AVPs are (and their larger salaries will ensure a higher actual bonus payment).

As the table below shows, UBS and Credit Suisse, Asia’s largest private banks by assets, offer the smallest bonus percentages. Your total bonus figure at these firms is likely to be competitive, however. “There are RMs at UBS and CS who produce much higher revenues than they would elsewhere because they have more options in each product category and have tier-one product support and platforms,” says a former private banker in Singapore. “This can collectively lead to more revenue generated to compensate for a lower bonus ratio.”

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