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Careers, Salaries, Recruiting, and Exits

If there’s one group that gets more online hate and insulting comments than any other, it might be private banking.

For some, private banking is an entrepreneurial field where you build a client list, advance based on your own merits, and enjoy high compensation and a great lifestyle at the top.

For others, private banking is where you go if you couldn’t get into investment banking or sales & trading.

As usual, the truth is somewhere in between.

I’ll address both views and reach some conclusions here, but let’s start with the basic definitions first.

• What is Private Banking?
• Wait a Minute, Why Do Rich People Pay for Private Banking?
  • Private Banking vs. Private Wealth Management
  • Private Banking vs. Asset Management (“Mutual Funds”)
• Roles in Private Banking
• The Top Firms for Private Banking
• Large Banks vs. Boutiques and Family Offices
• Moving Up the Ladder
• A Day in the Life of a Private Banker
• Private Banking Salaries and Bonuses
• Private Banking Recruiting and Interviews
• Private Banking Exit Opportunities
• Private Banking: Final Thoughts

What is Private Banking?

Private Banking Definition: Private bankers manage financial assets for high-net-worth (HNW) and ultra-high-net-worth (UHNW) individuals and handle other financial matters for them, such as tax, estate, and philanthropic planning, in exchange for fees on the managed assets.

The definitions of “high net worth” and “ultra-high net worth” vary, but as rough guidelines:

• High Net Worth: An average net worth of $5-10 million USD, with a minimum of $1 million.
• Ultra-High Net Worth: An average net worth of $20-30 million USD, with a maximum of around $100 million (above that level, you’re in “family office” territory).

Since banks charge fees based on a percentage of assets managed, it’s not worth their time to target people with $200K to invest.

At that level – around $200K to $1 million – individuals fall into the “private client services” or “privilege banking” category, which means premium bank accounts, credit cards, and other services.

They may also qualify for private wealth management (see below), but typically not private banking.

Wait a Minute, Why Do Rich People Pay for Private Banking?

“But wait,” you say, “if someone is worth $10 or $20 million, why do they pay for ‘investment advice’ from bank employees who are worth far less than that?”

I would answer this question with these three points:

1. Many people with this net worth do not pay for private banking because they don’t need the services. Even the bulge bracket banks have only low-single-digit percentages of this market.
2. Clients typically use private banking for more than investment management. For example, a real estate mogul might pay for private banking so he can get loans for new properties at below-market interest rates from another division at the bank. There’s also the “taking care of tax/legal paperwork” aspect.
3. Private banking can also be useful for getting loans against illiquid assets such as rare artwork and for gaining access to products not available on normal exchanges, such as shares in pre-IPO tech startups that the bank is taking public.

In short, clients often pay for private banking not because of the investment management services but because it gives them access to other, higher-value benefits at the bank.

Private Banking vs. Private Wealth Management

These two areas (“PB” and “PWM”) are similar, and at some banks, they are the same group.

The main differences are:

1. Work Focus – PWM focuses on managing clients’ investment portfolios, while PB has a much broader scope.
2. Net Worth – PWM is open to a much broader set of clients; the minimum net worth might be a few hundred thousand USD rather than $1-2 million or $5-10 million.

Many students complete internships in PB or PWM to get the brand name of a large bank on their resume and then use the experience to apply for other roles.

At the internship level, the PWM vs. PB distinction means little; the differences become more important in full-time roles.

Private Banking vs. Asset Management (“Mutual Funds”)

Private bankers invest on behalf of individuals, while asset managers invest on behalf of institutions (and large groups of individual investors).

A private banker might review a single client’s portfolio, recommend a different asset allocation, and set up the client with tax and estate planning services.

But an asset manager such as Fidelity would invest the funds of endowments, pensions, and similar institutions and aim to earn a high return for them.

Individual investors can also put their money into the mutual funds offered by these firms, but there’s no “personalized service” as there is with private banking.

Roles in Private Banking

At most firms, professionals in private banking are split into Relationship Managers (RMs) and Investment Professionals (IPs).

Relationship Managers maintain existing client relationships and find new clients, while Investment Professionals manage clients’ portfolios, report on performance, and research and recommend new products.

There is some overlap between these roles, but private banking is primarily a sales job.

If you don’t like interacting with clients and catering to their needs, you should not work in this field.

In addition to the RM vs. IP split, groups are often divided based on the average net worth of clients (HNW vs. UHNW) and specific demographics.

For example, one team might focus on tech startup CEOs, another might focus on mid-level financiers in private equity or hedge funds, and another group might work with small-business owners.

The Top Firms for Private Banking

You can roughly divide the market like this:

• Large Banks: The usual suspects (all the bulge brackets and some middle-market firms and in-between-a-banks).
• Pure-Play Private Banks: Each firm here manages hundreds of billions of assets (huge but smaller than some of the “large banks”). Example firms include Pictet, Lombard Odier, Julius Baer, EFG, St. James’s Place, Schroders, and Vontobel Holding.
• Boutiques: These firms tend to have less than $100 billion under management. Examples include Mirabaud, Bordier & Cie, and Degroof.
• Multi-Family Offices: These firms are also small but might be a bit bigger and more diversified than the boutiques. Examples include Bessemer Trust, Stonehage Fleming, Iconiq, and NS Partners.

If you go by assets under management, UBS, Credit Suisse, BAML, and Morgan Stanley tend to be near the top, along with JP Morgan and Goldman Sachs.

These firms differ based on regional strengths, client focus, and internal process and hierarchy.

For example, CS and UBS tend to be stronger in Europe and Asia than in North America.

GS and JPM tend to favor UHNW clients, while BAML and MS have a broader range of clients.

At GS and JPM, there’s more of a structured hierarchy and advancement process, while at firms such as UBS, BAML, and MS, advancement is linked more closely to commissions.

These are general trends, so expect to find exceptions and variations.

Large Banks vs. Boutiques and Family Offices

The general differences between large and small firms are:

• Client Count: Each financial advisor at the large banks might have 100+ clients, while a family office might have 100 clients total.
• Net Worth Requirements: Many family offices effectively deal with only UHNW clients, while the large banks are open to a broader set of clients.
• Investment Strategies: The large banks usually recommend more conventional strategies based on the public markets, while family offices customize their strategies and are willing to recommend the unorthodox for certain clients.
• Recruiting: The large banks recruit on-campus at both the undergrad and MBA levels, while family offices are far less visible; you’ll have to network on your own to get in.
• Workflow and Jobs: The scope of services at family offices tends to be broader because they might do everything financial for clients. The RM and IP roles are often blurred because each person does a bit of everything.
• Junior-Level Roles: At family offices, you’ll spend more time on investments, research, and reporting and less on cold calling and cold emailing because most clients come via word of mouth.

Moving Up the Ladder

There is a traditional Analyst to Managing Director hierarchy at some firms, with different responsibilities at each level.

At others, you start as a “Financial Advisor,” retain that title, and build your book of clients over time.

Regardless of your starting title, you normally begin by supporting the existing Relationship Managers for 2-3 years.

After that, you need to strike a balance between bringing in new clients and maintaining existing ones to keep advancing.

On the Investment Professional side, advancement is more about working with RMs and clients and getting them to implement your strategies and recommendations.

At most banks, you’ll advance from Analyst to Associate in 2-3 years; the advancement time after that is highly variable because it’s performance-based.

Along the way, many people burn out or realize it’s not for them and switch groups. As with IB, PE, and even Big 4 Transaction Services, only a tiny percentage make it to the top.

On the flipside, both RMs and IPs can get promoted quickly if they perform very well.

There’s less of an artificial “promotion timeline” than there is in investment banking or private equity, so you’ll occasionally see people who get promoted from Analyst up through VP in < 5 years (though it’s not common).

A Day in the Life of a Private Banker

Daily life depends heavily on your role, location, firm type, client focus, and seniority.

If you’re in a junior Relationship Manager role, an average day might go like this:

• Morning (8:30 AM – 12:30 PM): Meet with your senior RM and some Investment Professionals to review client accounts, performance, and market activity. After the meeting, you scrub corporate websites and LinkedIn for new leads, send some outreach emails, and place a few cold calls.
• Lunch (12:30 PM – 1:30 PM): Meet with one of the MDs in your group to discuss long-term career planning and the PB industry (this person has volunteered to be a mentor).
• Afternoon (1:30 PM – 5:30 PM): You go to a series of client meetings with your senior RM and take notes on each client’s goals, major life/business updates, and so on. Occasionally, you chime in with facts and information on investment, estate, and tax products.
• Closing (5:30 PM – 6:30 PM): You review the day’s activities with your senior RM, plan the rest of the week, and follow up with a few prospects you contacted last week.

If you’re on the investing side, the day might look like this:

• Morning: Meet with the RMs to discuss different client accounts and update them with your latest recommendations. You then run some performance reports for another set of clients to benchmark them against the markets and their stated goals.
• Afternoon: Do some research on alternate asset allocations for a few clients who requested them and estimate their returns with these new mixes. You also put together recommended allocations for a few prospects that the RMs recently contacted.
• Closing: Meet with the rest of your team to discuss market events this week, new products that might interest clients, and overall performance over the last quarter.

On average, the private banking job is about 50 hours per week.

But you are always at the whim of your clients, so expect random requests and favors at unusual times, especially with UHNW clients at smaller firms.

Private Banking Salaries and Bonuses

Compensation for private bankers is based on structured salaries and bonuses or commissions, depending on the firm.

It’s difficult to give ranges for commission-based compensation because it’s highly variable, but the approximate ranges at large U.S. banks that use the salary/bonus scheme are:

• Analysts: Base salaries starting at $85K and rising to over $100K with bonuses around 15-30% of base. Expect total compensation in the $100K to $150K range.
• Associates: Total compensation will be in the $150K to $250K range, with the majority in the form of your base salary.
• VPs / Directors: Total compensation will progress toward the $300K – $500K range.
• MDs / Partners: At this level, total compensation might be in the $500K to $1 million range, and some may earn over $1 million.

If we run through a quick example, you’ll see how the math works.

The standard fee is 1%, so if a group manages $1 billion for clients, that’s $10 million in fees.

However, only a portion of these fees goes to the team; something like 60% might be allocated to the parent company, with 40% going to the PB team.

In this example, that leaves $4 million for the team.

If the average account is $2-3 million, $1 billion managed means around 400 clients.

At a large bank, a team of 8-10 people might support this client count.

There will also be some overhead expenses, so less than $4 million will be available for distribution.

That amount could support perhaps 2 Managing Directors, 3 VPs/Directors, 2 Associates, and 3 Analysts if you take the mid-points of the ranges above.

The trade-off vs. investment banking salaries is clear: in exchange for greatly reduced hours, expect greatly reduced bonuses.

The average workweek might be 50-55 hours, but your bonus will also be 15-30% of your base salary rather than 50-100%.

At the top levels, private banking can be quite lucrative with a good lifestyle, but it is not easy to get there, and ~95%+ will burn out or quit along the way.

Private Banking Recruiting and Interviews

Recruiting for private banking is less competitive than investment banking, sales & trading, and private equity recruiting.

A good comparison might be corporate banking, but PB may be “easier” in the sense that fewer technical skills are required.

Firms recruit on-campus at the undergrad and MBA levels, and the timeline is less accelerated/crazy than the one for IB roles.

You don’t need multiple highly relevant internships to win a junior-year summer internship; you could bounce around a bit and get a PB internship late in the game.

You can network your way into internships and full-time roles via informational interviews and cold emails, but “networking” is less important because there’s less competition.

Interviews tend to be straightforward and emphasize breadth over depth.

You can expect the types of questions you might receive in an asset management internship interview: market knowledge, portfolio management, different asset classes, economics, why this firm, why this industry, your strengths and weaknesses, etc.

However, the questions are likely to be even less technical, especially if you interview for RM roles.

For example, you probably won’t get detailed questions about the DCF model or even accounting and 3-statement models (which may come up in AM).

And you’re not likely to get any questions about company valuation, comparable company analysis, merger models, LBO models, etc.

A few example questions might include:

Q: How would you assess a client’s goals and make investment recommendations for their portfolio?

Q: How would you add value as a new hire in this group, given that you don’t yet have a wide network?

Q: Why private banking rather than private wealth management (if applicable) or why PB rather than other markets roles like equity research and sales & trading?

Q: How would you invest $1 million right now?

Q: Which asset classes perform best when interest rates are low and when interest rates are high?

Q: How would you analyze a client’s portfolio to recommend a different asset allocation?

I’m not going to write out answers because these questions are not difficult if you’ve read this article and you know enough about financial markets to be competitive for these roles.

With all the “client” and “investment recommendation” questions, the key is to assess the client first (age, background, current and expected future income, wealth, goals, etc.) and tailor your recommendations based on that.

To add value as a new hire, you can assist the senior RMs and IPs with tasks such as reporting and research so that they have more time to win new clients. Eventually, you can help them with maintaining existing relationships as well.

Private Banking Exit Opportunities

And now we arrive at the major downside of private banking careers: the exit opportunities are not so great.

If you’re in a Relationship Manager role, your main options are to stay in that role, move to a different firm, or eventually start your own firm.

You might be able to go into something like investor relations or fundraising for private equity firms and hedge funds, but the experience doesn’t translate 1:1 (sales to institutions vs. individuals).

Institutional sales is another option, but again, it’s not necessarily an “easy” transition.

It would be virtually impossible to move from PB into a transaction-based role such as investment banking, private equity, or corporate development without deal experience.

If you’re on the investing side, you’ll have more options, in theory, because of your experience doing analytical and markets-based work.

Asset management or mutual funds might sound like reasonable options, but the investing styles are somewhat different, and turnover in those industries tends to be quite low.

So, “possible, but not likely.”

You might stand a better chance at certain hedge funds, in macro research roles at funds, or even in something like investment consulting.

Certain sales & trading desks might be options, but it depends heavily on your product knowledge and experience.

If you know a lot about FX and swap products because you’ve helped foreign clients hedge their FX exposure, then the FX desk might be feasible.

But if you have no experience with derivatives, don’t expect to go from private banker to options trader.

Private Banking: Final Thoughts

I’m not going to write a long pro and con list here.

Instead, I’ll summarize private banking like this: it’s fine for an initial internship or entry point into the industry.

It can also be quite lucrative at the top once you have ~100 clients and you’re earning well into 6- or 7-figure income from them.

At the top, it’s less stressful than IB and PE because you don’t have to generate and close new deals constantly.

You just have to keep your existing clients happy and occasionally find new ones, and you’ll keep earning the fees.

However, private banking is not so great in the mid-levels, particularly if you decide against it after working in the field for many years.

Since exit opportunities are limited, you may need to go to business school to re-brand yourself for a total career change.

If you can survive your first 5-7 years, you have a good chance of earning a few hundred thousand dollars per year while working 50 hours per week (or less).

But most people do not even make it to that level because they don’t have the required sales skills and persistence.

If you have other options in finance, I would not recommend private banking for your first full-time job because of the limited optionality.

It’s a better choice if you’ve interned in a few fields, worked full-time in something like IB or S&T, and decided that you like the advantages of PB and don’t mind the drawbacks.

So, while the negative comments about private banking are overblown, it’s also easy to see why it’s not viewed in the same “tier” as the other front-office finance careers.

Job description and average salary

The banking industry serves a broad range of individual and business customers. Banks and credit unions have a number of different personnel to serve the needs of their clients from customer service representatives to financial advisors to private bankers. These institutions employ private bankers to provide an additional level of service for high and ultra-high net-worth (UHNW) clients.

Akin to a financial advisor, a private banker provides in-depth analysis on an individual or company’s financial circumstances and makes recommendations based on specific investment, estate planning, and charitable objectives. Private bankers are typically employed with a large financial institution, while financial advisors or wealth managers serve outside the banking environment. But what does it take to become a private banker? And how much do they make? This article outlines what a private banker does, the education and skills needed to become one, and the average salary someone makes in this position.

Key Takeaways

• Private bankers work in financial institutions and cater to high- and ultra-high net-worth individuals.
• Primary duties include managing clients’ financial circumstances and providing them with financial recommendations.
• Most private bankers have at least a bachelor’s degree and are licensed.
• Private bankers should have a great understanding about the banking industry, and good interpersonal and communication skills.

What Do Private Bankers Do?

As mentioned above, private bankers work in many different parts of the financial services industry. This includes banks, credit unions, investment banks, and wealth management firms. They provide banking, advisory, and investment services to ultra rich clients.

Private bankers are typically assigned to clients of a specific bank branch. Unlike financial advisors, they do not have the responsibility of continuous prospecting. For smaller banks or credit unions, a private banker may make phone calls or reach out to prominent individuals or businesses to attract new high net-worth clients to the financial institution. Private bankers, in partnership with and supported by the bank, may also be responsible for implementing client appreciation events to ensure a high level of retention for the bank.

Evaluating Client Circumstances

The most prevalent part of a private banker’s job is to manage their clients’ financial circumstances with a focus on maintaining a strong relationship between the client and the bank. Private bankers begin managing clients’ complex financial matters by evaluating their current financial position. This review involves gathering information about their clients’ total assets such as property and business interests, the balances of their bank accounts, and the value of all investment portfolios. Private bankers account for a client’s debt obligations and personal financial goals.

Making Recommendations

After gathering and evaluating information about a client’s financial situation, a private banker makes recommendations on how to position investments and savings to achieve the client’s objectives. These recommendations often include detailed portfolio positions for a client’s investment accounts and the allocation of assets among certificates of deposit (CDs), conventional savings accounts, and other non-traditional alternatives intended to preserve capital.

Recommendations from private bankers may also focus on estate planning needs, such as establishing a trust for a spouse or heirs, or obtaining the appropriate amount of life insurance to protect heirs from paying excessive estate taxes.

HNWIs often need to reduce tax obligations. As such, private bankers make suggestions regarding tax efficiency in short- and long-term investments and earned income. To help offset some tax liability, private bankers often suggest that clients consider the financial benefits of philanthropy. Some private bankers also vet the charities to ensure a donation would provide a tax deduction.

Education and Training

Most financial institutions require private bankers hold at least a bachelor’s degree. Undergraduate work best suited for a career in private banking focuses on accounting, finance, or business. Although not necessary, a marketing degree may also benefit a private banker in his or her career. Positions in financial institutions with a large number of UHNWI clients may require a master’s degree in finance, accounting, or business. Ongoing training is provided on the job, generally represented by working with a tenured private banker or a wealth manager at the financial institution.

Because private bankers often provide detailed advice surrounding a client’s investment portfolio, positions may require certain Financial Industry Regulatory Authority (FINRA) or North American Securities Administrators Association (NASAA) licenses. The FINRA licenses typically required to offer investment advice and implement investment strategies include the Series 6 and Series 7, while NASAA licensing guidelines may require a Series 63 or Series 65 license.

Each of the FINRA and NASAA licenses involves completing a proctored exam, along with ongoing continuing education requirements. These and other industry designations and professional certificates assist in establishing credibility with HNWI clients. 

Skills

Private bankers must also be able to analyze financial information to create and implement recommendations. That’s why they should have a great understanding of the banking and financial systems, along with knowledge about credit and lending practices. They should also stay abreast of current events like economic and market news. Even though they normally deal with high net-worth individuals, private bankers should be able to deal with all types of clients.

Private bankers must be able to analyze financial information to create and implement recommendations.

A private banker’s greatest responsibility is to maintain relationships with HNWIs to ensure their assets remain with the financial institution. An individual working as a private banker must establish a rapport with individuals quickly and build trust with potential or current clients. This is why excellent interpersonal and communication skills are required.

Salary

A private banker’s compensation is typically comprised of a base salary plus commissions based on an assets under management (AUM) fee. According to the most current information available on Payscale, entry level private bankers can earn as much as $49,132 including commissions and bonuses. The total annual compensation ranges from $40,000 to $126,000. The site reported that the average annual base pay for a private banker is $68,553, with additional compensation including bonuses and commissions.

Private bankers with a small book of clients tend to earn a lower income than private bankers with a large, established book of business. Similarly, private bankers who work in regional banks or credit unions are less likely to be on the higher end of the salary scale than those who work for larger national financial institutions.

The Bureau of Labor Statistics (BLS) includes private bankers with personal financial advisors. It says the industry is expected to grow 4% between 2019 and 2029. This growth is expected to be approximately as fast as other occupations.

Information on Private Banking Jobs and Salary Expectations | What is a Financial Planner?

Degree CompletedHigh School Diploma/GEDSome CollegeAssociate DegreeBachelor’s DegreeMaster’s DegreeDoctorate Degree

Desired DegreeDiploma/CertificateAssociate DegreeBachelor’s DegreeMaster’s DegreeDoctorate

Program of InterestAll Business ProgramsAccountingBusiness AdministrationCommunicationsFinanceHospitality ManagementHotel & Restaurant ManagementHuman ResourcesInternational BusinessManagementManagement Information SystemsMarketingOrganizational LeadershipProject ManagementSports Management

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Private bankers are often called wealth managers because they assist High Net Worth Individuals (HNWI) with sizeable assets in making investments. This type of service is reserved for banking clients with assets above $250,000 and may include stock brokerage, checking services, tax advisory and savings. Private bankers are denoted as private because their interactions with each client are exclusive to the client’s personal situation.

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Despite the recent downturn in global financial markets, private banking jobs thrive among qualified finance professionals with years of industry experience, especially in the United States. Eight of the top private banking institutions are headquartered in the United States including Bank of America, Wells Fargo, Morgan Stanley and JPMorgan Chase. Although there have been instabilities in the general banking industry, private bankers have enjoyed steady growth due to their ability to consistently generate wealth for their clients.

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Another factor in the growth of the private banking industry is the disproportionate growth of the HNWI population. This growth of individuals with more than $1 million in assets has risen at 1.5 to 3 times as fast as GDP in some markets. The rapid expansion in HNWIs has contributed to a higher demand for private bankers who can properly manage their wealth.

The turbulence in global markets has dampened consumer interest in riskier investment opportunities for the moment, but this is expected to change as stability is re-established. Private bankers who are currently supporting client desires to remain in low risk ventures may soon be able to encourage HNWI to take advantage of higher risk investments that offer significantly enhanced returns.

The limited appetite for risk has helped make the private banking industry more creative. Private bankers are seeking low-risk investments in developing countries like China, Brazil and India, which may yield enormous returns over a long term period.  More agile investment strategies that react more swiftly to events in the market have also allowed private banks to reduce risk in their ventures.

Becoming a Private Banker: Experience Requirements and Degree Options

Because a private banker is such a client centered profession, it is important to obtain substantial academic as well as professional credentials. As a manager of client assets, private bankers are expected to possess superior knowledge of financial markets, investment opportunities and risk assessments. An undergraduate education culminating in a bachelor’s degree is essential; most professionals in this position obtain a degree in finance, business administration or economics. A large number of private bankers also add to their curriculum vitae by also obtaining a master’s or PhD degree in one of these fields. A Master of Business Administration (MBA) is a common degree.

It is fairly common for recent graduates to enter the financial industry as an intern with a prestigious investment banking firm. Many also may interview for entry-level positions while still in school, but employers are highly selective and positions in investment banking are awarded to only the most qualified. Typically, prospective employers recruit bankers with outstanding academic competencies, demonstrated experience and skill in the field and the highest recommendations from professionals already in the field.

Private banker jobs are awarded to outstanding professionals in investment or commercial banking after some years of experience. Many of these candidates have already advanced their career into a management position. Because clients are looking for private bankers with a great deal of experience with investments, it is unlikely to obtain a private banking job until at least five to 10 years of banking experience. Some firms like Goldman Sachs, UBS and HSBC operate training programs that can be a springboard into private banking.

Professional Certifications for Private Bankers

There are a number of professional certification programs that offer highly respected credentials upon completion of their training programs.

• The Globecon Institute offers a number of certifications:
  • Operations in Investment Banking and Securities Markets Certificate Program is available for Level I or Level II. These programs require completion of at least 12 courses over three to four months.
  • Private Banking and Wealth Management Certification Program is available for Level I or Level II. Completion of 12 courses within nine months is required.

Licenses Necessary to Practice Private Banking

The Financial Industry Regulatory Authority administers the securities licensing procedures for financial professionals. In order to speak with clients about various financial instruments, private bankers are required to obtain the following licenses.

• Series 6: This license allows private bankers to discuss packaged investment products like mutual funds, unit investment trusts and variable annuities with clients. A 135-minute exam covering investment topics, regulations and ethics must be passed. A FINRA member firm must sponsor the applicant.
• Series 7: This license permits private bankers to offer individual securities to clients. This may include stocks, bond, and call or put options. In order to acquire this license, the candidate must complete a six hour examination that covers many topics in securities trading. A FINRA member firm must sponsor the applicant.

The North American Securities Administrators Association also administers some licensing procedures.

• Series 63: This license is required by every state in order to conduct investment business and is also required for Series 6 and 7. An 75-minute exam must be successfully completed.
• Series 65: This license authorizes private bankers to provide financial advice or service that is based on hourly fees rather than commission. An 180-minute exam must be passed.

Employment and Salary Expectations for Private Bankers

According to the U.S. Bureau of Labor Statistics (BLS), the median salary for personal financial advisors was $87,850 in May 2019. The BLS doesn’t have data for the personal banker job title. The BLS projects that the job outlook will grow 4 percent from 2019 to 2029.

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Among the major banks, private bankers earned salaries ranging from $30,000 annually up to $170,000. At JPMorgan Chase, the six private bankers earned salaries from $38,000 up to $100,000.

At Bank of America, the five private bankers surveyed earned salaries ranging from $30,000 to $110,000. At Wells Fargo, the eight private bankers surveyed received annual salaries ranging from $46,000 to $150,000.

The salaries for Citibank’s six private bankers were between 93,000 and $170,000.

A private banking manager at Bank of America earned between $120,000 and $129,000 in annual salary and benefits, while the salaries for Citibank’s three vice presidents of private banking ranged from $120,000 to $130,000.

Personal banker: job description and average salary

Personal bankers work in retail banking and help clients with various needs, such as opening checking and savings accounts; obtaining mortgage and car loans; investing in certificates of deposit (CD), money markets and other commercial banking products; and planning for retirement or college. Although investment bankers work primarily with institutional investors, personal bankers work primarily with ordinary people. Most of their clients are private citizens of the communities in which the bankers work. Personal banking usually doesn’t pay, as do investment banking and other Wall Street careers, but it provides a much better work-life balance and the hours are a lot more reasonable. In fact, the term “bankers’ hours” was coined to describe the limited time that local bankers think they spend on work.

The typical investment bank has dozens of Ivy League alumni sitting at their Bloomberg terminals talking aggressively about the latest deals in their headsets. The investment banker stereotype is aggressive, well-educated and hungry youth. Most personal bankers are cut from other fabric. While a business degree helps, and an MBA looks even better on a personal banker’s resume, many local bank branches care less about educational credentials than they do about community reputation, networking ability, and affability. These banks take pride in hometown service and prefer to meet with a gathering of banking settlements and greet new customers.

Personal banking is an ideal career for those who love building relationships in their local community, love the markets and want to earn a solid income but don’t care about getting rich.

Opening Accounts

Perhaps the most standard day-to-day duty of a personal banker is helping bank customers open new checking and savings accounts. Personal Banker handles new clients as well as existing clients who want to open a new account. These bankers sit at these large, L-shaped tables that run along the lobby in most retail banking branches. The task of a personal banker is to set up an account according to the needs of the client.

Personal Banker also offers ancillary products such as overdraft protection and a rounding option, an account check feature where each debit card purchase is rounded up to the next dollar, with the excess change placed in a savings account.

Sale of investment products

While retail banks rarely offer the aggressive investment vehicles you find on Wall Street, they do provide many conservative products that guarantee returns and are often insured by the Federal Deposit Insurance Corporation (FDIC). These products include CDs, money market accounts, and retirement accounts such as traditional and Roth Individual Retirement Accounts (IRAs). Some clients know exactly how they want to invest their money, while others need some guidance to make the right choice. Still others have no idea, in which case the job of a personal banker is to identify the client’s needs and goals and then provide an appropriate solution.

Selling loans

In some banks, personal bankers are licensed to sell mortgages and other loans. Other banks employ separate mortgage specialists, with a personal banker simply sorting the client and referring them to a finance specialist when needed. As a general rule, the smaller the bank, the more hats each banker wears. Personal bankers at small city banks can do everything from financial planning to mortgage lending.

In most cases, a personal banker only has access to their bank’s loan products, unlike a mortgage broker who can place his clients with dozens of banks and lenders. This puts a personal banker at a disadvantage, although many mortgage clients are happy to accept these restrictions in order to deal with a local banker they know and trust.

Retirement and College Planning

A personal banker helps clients finance their retirement and their children’s education. They sell Roth IRAs, traditional IRAs and annuities for retirement planning. For college savings, personal bankers offer savings bonds and the popular 529 plan, which is a tax-deferred college account. Once again, a personal banker often needs to take on an advisory role in order to successfully complete this part of their job. Banking terminology is a foreign language for some clients, so a personal banker can help the client understand and feel confident about where their money is being placed.

Skills

The ability to forge and maintain strong relationships within a community is by far the most important skill for a personal banker. The financial products themselves are not particularly complex and do not require an understanding of an MBA or supernatural math skills. This is not investment banking, where esoteric terms such as interest rate swaps, credit default swaps, and collateralized debt often come up in client conversations. Most personal banking products are simple, but a personal banker should make the customer comfortable enough to buy with them.

Training requirements vary from bank to bank. Unlike law or medicine, the industry only requires a high school diploma. For those in college who are considering personal banking, a business degree, especially with a concentration in economics or finance, is the way to go.

Pay and Hours

Personal bankers earn walking salaries, especially when compared to their investment cousins. The average annual base salary is between $30,000 and $35,000. Each bank’s pay structure is slightly different, but almost all offer a combination of bonuses and commissions that allow personal bankers to earn more than their base salary. These additional incentives mean that a productive network and finding clients correlate directly with a banker’s salary. A motivated personal banker can earn over $50,000 in first year total compensation, and more after building a broad client base. However, Wall Street’s six-figure earnings usually elude personal bankers.

The big advantage of the personal bankers supporting the Wall Street mob is the number of hours. Look at the opening hours posted on the door at any local bank. They are usually quite restrictive, such as 9:00 a.m. m. to 4:30 s. m. during the week. The hours of a typical personal banker, meaning they often work less than 40 hours a week. People who want to live with dignity while prioritizing family time should consider a career in personal banking.

Profession banker ? how to become, how much they earn, where to study and what subjects to take, pros and cons

Exams and universities

11/12/21

10 min.

Profession banker implies great attentiveness, diplomacy and responsibility. To become a banker, it is not necessary to graduate from a banking university. Currently, many other universities are graduating specialists in this field. But for this, in any case, you need to get a higher education.

Contents:

• Bankers – what they do, features of work
• List and overview of positions in the bank
• What qualities should a banker have
• How to become a banker – where and how much to study in Moscow
• What subjects must be taken upon admission
• Salary of bankers in Moscow
• Career growth of a bank employee
• Pros and cons of being a banker

Bankers – what they do, features of work

Features of such work are not only in the departments in which specialists work, but also depend on the operations, scope, segments and specifics of the bank.

There are several departments in which bankers work:

1. The lending department employs specialists involved in issuing loans and mortgage payments. They control their intended use, remind clients about the implementation and payment of debts;
2. The investment department employs specialists who are responsible for the analysis of various projects, control over the activities of enterprises, control their payments and financial condition;
3. The department of securities employs those people who place them on the market, make various investments in securities, control the increase and decrease from them, issue their own bills;
4. Employees of the department of funds deal with the placement of shares and bonds of their bank on the stock exchange and the market;
5. Operations Department performs various operations and provides services to its clients on this specificity;
6. Plastic card department provides services to customers who own plastic cards of their bank, and also reminds them of the service, attracts them to open new plastic cards, credit and debit;
7. Legal Department deals with all legal transactions, checks the client base and records debts. In addition, this department employs specialists who are required to conduct arbitration processes that arise in the course of work;
8. In the department of economic analysis , economists and financiers are engaged in analytical operations, keep records of all economic resources of the bank;
9. Marketing Department is engaged in advertising in magazines and other places, placement in the media, dissemination of information about the bank in order to attract more customers.

Employment of employees in the bank also depends not only on the position held or the department in which this or that employee works. Including their specificity is determined by the size of the bank. The larger the bank and its structure, the greater the volume of work, the more difficult it is to work, and the more skills and professional skills will be required.

List and overview of positions in the bank

Usually people, choosing this specialty for themselves, go to work either in state-owned banks, like Sberbank, or choose private organizations.

The most common banking professions include accountant, financier, economist, credit officer, debt officer, investment officer, insurance officer, and private client officer.

What qualities should a banker have

Education is required to become a qualified employee. The requirements that both the profession itself and the employer impose are quite high.

It will be more comfortable for a person to work in such a position if he has some personal qualities. Among them are the following:

• liability;
• diplomacy;
• punctuality;
• stress resistance;
• composure;
• the ability to do the same type of activity for a long time;
• mindfulness;
• initiative;
• the desire for self-improvement.

If you have these qualities, you can quickly achieve positive results and accelerate the process of climbing the career ladder.

To become a banker, you need to get an education. It is advisable to graduate from one of the universities in full-time education, choosing a faculty.

In Moscow, the following universities can be distinguished that graduate specialists in this specialty:

• Academy of Labor and Social Relations;
• Graduate School of Business of the State University of Management;
• State University of Management;
• Humanitarian Institute;
• Moscow State University.

Becoming a banker is possible not only by receiving full-time education. Many universities also offer distance or part-time education. In the case of full-time study, students study from 4 to 6 years.

Correspondence training usually lasts from 3 to 5 years, depending on the existing or missing higher education. On distance learning, specialists usually graduate after 4 years of study.

Secondary specialized education also gives a chance to become a banker. In Moscow, at least two colleges produce such specialists. These are the Moscow Commercial Banking College and the Moscow Credit College. You can enter them after 9or 11th grade.

What subjects must be taken upon admission

Upon admission to institutes, applicants are required to provide not only a package of documents, but also pass mandatory exams. Recently, certain exams have been practiced.

It is necessary to pass the Russian language and mathematics upon admission . Some universities also require the Unified State Examination in other sciences, for example, in history or social science.