Director of PSD’s Banking and Financial Services, Gail Danvers,
comments on the changes that the sector experienced during 2016 and explores
the future trends for 2017.
“Political Change, Regulation and the Digital Revolution defined the UK Banking and Financial Services sector in 2016.”
Banks hire despite Brexit
Banks and Financial Services firms came out defiantly in support of staying in the European Union. They cited numerous financial reasons relating to the UK economy for this, and their opinion has not changed since the UK voted for Brexit, stating that post-Brexit will mean a decline in the Financial Service sector. Immediately after the referendum there was an initial pause in hiring - clients reviewed their live roles to ensure that each hire was business critical. Following this slight delay the majority of clients continued to hire with only a handful deciding against hiring or delaying to 2017. We are therefore looking at the market with continued optimism for 2017.
“The majority of clients continued to hire with only a handful deciding against hiring or delaying the hire to 2017.”
2016 saw the continued growth of the Challenger Banks, Alternative Finance Providers, Financial Technology firms and Payment Disrupters. These new entrants to the market have brought a different approach to the market, being driven by Technology and focussing on the customer. Free form legacy IT issues, legacy customer issues and capital restraint means these companies are more agile and responsive to customers. They can provide a faster, more tailored service to meet the customers' needs. Their hiring requirements vary depending on where they are on the growth journey. Challenger banks that have been in business for several years are now under more scrutiny from the regulator as their balance sheets present more risk, and consequently their growth requirements are often in the support functions of Credit, Risk, Compliance, Finance, Operations and IT. The Start-Ups focus more on hiring Sales and Business Development staff and Technology specialists. Cultural fit is an important factor for all organisations, and hiring candidates that fit the current requirements of an organisation is crucial, whilst future-proofing the hire, in line with the business's future strategic plans, remains the key to retention. Established firms look for a specialised skill set - a subject matter expert, which is in stark contrast to the Start-Up firms which often favour the generalist, or someone with the ability to do something they haven't done previously.
During 2016 we hosted forums at our Head Office in London, which focused on Operational Risk. We were delighted to host a number of guests to hear our key speakers - Ariane Chapelle and Helen Pykhova - speak about the hotly debated subject of Operational Risk - which is an area that has experienced significant demand over the years. Across the whole sector there is a substantial difference in how advanced firms embed sound operational risk practices. Like all regulation, the gaze is turning slightly away from large banks to the smaller asset managers, insurance firms and SME banks.
Cyber Risk on the rise
2017 looks set to be an interesting year as the Banking & Financial Services sector tries to balance the need for regulation with innovation. There is a continued requirement to provide financial stability and trust to the market, along with the need for economic growth, bought about by innovation and the developing needs of customers. As a result, we expect there will be a significant growth in hiring across certain areas of the sector in 2017. The delay of MIFID to 2017 will fuel further Regulatory hiring as will the continuous developments of the Prudential and Basel Regulations. For the first time money spent in Cyber Risk, Fraud and IT Security overtook Regulatory in Financial Services - this will create a significant demand for candidates with those skill sets. We also anticipate growth in the areas surrounding digital and the customer experience.
PSD's Banking & Financial Services Sector delivered on some exciting work in 2016. By capitalising on our mixed and varied client portfolio we were able to place a number of high-level appointments as well as numerous management-level placements. These included a board level CFO for a medium sized Payments firm, the Head of Financial Crime for a Tier 1 Wholesale Bank, a Chief Risk Officer for a small foreign bank, a Head of Human Resources for an Insurance firm and a Managing Director for a Financial Technology firm. Having such a long history in the sector has enabled us to develop excellent client relationships with both small and large firms. We are therefore able to adjust to fluctuating hiring needs by following the market and developing new client relationships.