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Banking, Finance & Accountancy careers

Private Banking/Wealth Management

Who needs private banking or wealth management?

So you have a lot of money. A LOT of money! You are looking to invest it, protect it, grow it and generally help it double, triple and quadruple in value. If this is the case, it would be best to seek advice from the private banking and wealth management divisions of the many, many banks out there.

If you work in this division, your responsibility is to advise high net worth individuals (i.e. very rich people) on what they should be doing with their money. Discretion is the key here, as the phrase ‘private banking’ indicates. It’s an exclusive club that will expect service on a more personal basis.

The difference between discretionary and advisory services

Put simply, there are a lot of people in the world that have a lot of money. These individuals are not your usual ‘over the counter’ type customer – they require highly-specialised advice and demand complete privacy for their business. Generally, this subsector has two clear segments to it: discretionary and advisory.

The discretionary approach is where the bank takes on all of the responsibility and manages their client’s portfolio. The client is briefed on every aspect of the process, but it is the bank that makes the ultimate decision on where to put the money.

The advisory service is a little more consultative, with the client being presented the various options before making the final call themselves.

Given that the sums you could be playing with might be upwards of 20 million pounds, there is a huge amount of responsibility associated with a career in this area. Since the recession though, the diversification of many banks and their business models has led to private banks taking on clients with anything from half a million upwards.

How can I get into private banking?

To be a success in wealth management, there is quite the checklist. You must have:

  • Excellent communication skills, including the ability to convey complex financial systems in a straightforward manner
  • The ability to build strong relationships quickly
  • A strong talent for analysing investment opportunities, and spotting the most useful ones for your clients.

Unlike most other areas of the banking sector, it is likely that you will have a particularly ‘pally’ relationship with your client – such is the nature of private banking. If you lose them a lot of money, it’s not a faceless entity you are dealing with: it’s an individual that you know very well.

A step-by-step of private banking/wealth management

As with most areas of banking, there are three distinct aspects to the process: analysing opportunities, managing client relationships, and providing the administration to deliver the first two effectively. The first step in the process, assessing where to invest, requires analysts, statisticians and any other body that can decipher the many opportunities out there, and identify which are the most appropriate and likely to reap the biggest rewards.

Managing the client is fairly straightforward: you need to understand what they are looking to achieve and ensure it’s done. As with any service, if you are able to deliver on their expectations, you will see them coming back again and again.

With all of this though, there is an enormous amount of ‘stuff’ that needs to be done to make a decision translate into an action. This is commonly referred to as ‘compliance’. In this area alone, there are many career opportunities, and you may find yourself focusing on the legal aspect of things, HR, operations or general accounting.

Working in this sector marries the thrill and excitement of dealing with enormous stacks of money with having a rewarding, friendly relationship with your clients. It’s essentially like having ‘friends with benefits’! 

One of the best ways to start a career in private banking is to get some work experience under your belt. If you still have questions that we haven’t covered, check out our sister site AllAboutFinanceCareers to have all your finance queries answered.