The Three Positions Banks Need Most

Each year, Timothy Reimink, a managing director at the consultancy firm Crowe Horwath, takes a deep dive into the salaries of bank employees. Those salaries that rise-indicating an increase in demand and a lack of supply-signal the positions that banks need the most.

In 2015, for example, the five-year growth of CEO compensation was 20 percent, while CFO increases were 31 percent. Meanwhile, the lower levels of the banks didn’t experience the same jumps, with credit analysts gaining just 3 percent over the same time period.

But last year, something changed. Reimink’s analysis reversed, as CEO pay slowed down, while entry-level or early-career salaries increased.

“That trend has shifted somewhat in the past couple of years in the survey,” says Reimink. “Executive level positions’ increases were not quite as strong,” while there was “faster growth in salary among branch [positions].”

It’s a trend that financial service organizations have had to adjust to, in order to secure a bank’s strength. In a recent survey by consulting firm PwC, 72 percent of banking and capital market CEOs said the limited availability of people with key skills is a threat to growth.

To find out where the gaps lie, Bank Director digital magazine spoke with headhunters, industry analysts and human resource officers to uncover the positions banks are seeking right now and what they’re doing to attract the talent.

ENTRY-LEVEL POSITION:

Commercial Credit Analysts

When Farmers National Bank of Canfield, Ohio, had a need for a credit analyst in 2011, it went through its usual process of posting a job opening, searching the local area for talent and partnering with its recruiters to find the right candidate. But that applicant never materialized for the $2 billion asset bank.

Instead, Mark Nicastro, senior human resource officer at Farmer’s, decided to look inward to fill the position. They had a young employee who had come on as a personal banker. Nicastro and the employee’s supervisors felt he had the intelligence to learn how to analyze a loan arrangement and determine credit worthiness, even if he didn’t have the typical experience.

The employee sat with the credit team for a few days as a trial run, both to see if he could capture the concepts quickly and whether he would enjoy such a role. The employee now works as a senior credit analyst.

It’s a common refrain from those looking for credit talent now and comes from the decline in commercial lending programs that were popular in the pre-recession era. Big banks would hire college students and teach them the finer points in loan analysis through classroom instruction and seminars mixed with on-the-job training. Now, in large part, it’s “much more on-the-job training and less formalized,” says Alan Kaplan, CEO of talent search and advisory firm Kaplan Partners. The need has begun to show up in salaries, as credit analysts’ pay began to jump last year, with a 9 percent increase compared to 2015 levels, according to Crowe Horwath’s research.

That has led to human resource officers looking for talent internally, finding those that could shift to the commercial credit role, particularly when looking for entry-level employees. They’ve also tapped senior leaders to help make the switch more comfortable for the analysts, reassuring them that it will serve as a beneficial long-term move as well. And they also invest in the candidates’ development, like in the case of United Bank, a $5 billion asset lender based in Glastonbury, Connecticut, which uses a nearby financial program from the Connecticut School of Finance and Management to help with the training.

“The business of banking hasn’t changed,” says Craig Hurty, chief human resources officer at United Bank. It’s the process with which banks prepare their employees that has shifted.

MID-LEVEL POSITION:

Application Development Managers

As Silicon Valley and other technology hubs turn their interest toward consumer and business banking through mobile tools, there’s been an increase in the need for coders and developers to help banks keep up with changes in the industry, and managers to handle oversight of the technology development.

While the banks looking for developers depends on the size-smaller banks tend to look for a way to outsource production-there’s also a need for application managers that can understand the technology and translate needs to their third-party partners. Big banks, in particular, want the in-house developers in order to build their own technology. TD Bank, for example, reportedly plans to hire 1,000 IT-focused employees by the end of the year. And by last year, Fifth Third Bancorp had increased its in-house tech know-how by 27 percent since 2012.

For Hurty and United Bank, it’s not always easy to find talent that understands the process of developing software or applications to meet customer needs in some of the small towns in which the bank operates. And when they do find the talent, there’s no guarantee that person can also communicate effectively about technology to banking executives. Banks in general are craving this person who has both people skills and technical skills. There are a “lot of collaborative aspects” to the job, adds Hurty.

One way United has tackled the issue is to look outside the banking industry for talent. This does come with risk since there are banking compliance requirements that any new tool must pass before it goes live to a consumer. A technology expert outside of banking will naturally have holes in their knowledge when it comes to such rules, undermining the application development and costing the bank time and money. United has tried to solve the issue by ensuring each part of the organization focused on technology also has a separate manager that comes from the banking industry. This layering of leadership approach helps keep the technology side of the company from going down a disastrous path.

Asking longtime bankers to learn about and take responsibility for technology in their organizations has other benefits as well. In fact, Deloitte found that if you take a vice president of an organization and task him or her with at least some digital duties, there’s a 15 times greater chance that person will stay after a year, compared to the vice president who isn’t tasked with such a job.

“[Banks] are really challenging people to take the responsibility to move and shift the organization,” says Rob Dicks, a principal at Deloitte.

SENIOR MANAGEMENT:

The CFO

While there’s a renewed focus on the mid- and entry-level roles within banks, it doesn’t mean organizations think it’s easy to find qualified senior executives. Kaplan said his firm has led the search for five CFOs over the past 18 months.

But what banks are looking for in their CFO has changed. In many cases, a bank hires a CFO to position him or her “as a deputy CEO,” says Dicks. This increases the broadness of their oversight and the expectations of the job, and it also gets the executive ready to succeed the CEO some day.

CFOs have gone from guaranteeing that everything is in order from a compliance and accounting standpoint to spending much of their time ensuring capital is allocated in the most efficient manner possible. They need “strong management experience” to move their ideas forward, says Kaplan.

“Banks are looking for much broader capability and a more strategic CFO,” he adds, which means candidates have a wider set of skills than just accounting.

While they’re not seeing the pay raises they saw following 2008, candidates for the CFO job always are in demand, adds Reimink.

Positions in Need

Read below to get job descriptions for bank jobs in high demand.

Credit Analyst:

• Analyzes credit information and conducts credit investigations related to lending to establish the financial condition of potential borrowers
• Prepares spreadsheets, reports, summaries and opinions for use by loan officers, senior management or loan committees
• Performs financial analysis of commercial and commercial real estate loan requests and identifies the strengths and weaknesses of credit (Credit Analyst, Level II)

Application Development Manager:

• Manages application programmers, analysts and software engineers engaged in analyzing, developing, testing, implementing and maintaining computer application programs supporting the organization’s business processes
• Assigns, coordinates and reviews work of programmers and analysts
• Analyzes, develops, modifies and tests programs that control operations of the computer systems (Application Developer)

Chief Financial Officer:

• Establishes and maintains effective accounting and financial systems, procedures and controls
• Oversees management and external reporting
• Assists or directs development of budgets and planning
• Directs capital investment activities and serves as liaison with auditors and regulatory bodies
• Is the top financial officer in the financial institution

Source: Crowe Horwath LLP