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Wanted: Money mentors

With a booming economy minting millionaires, the demand for wealth managers has jumped. Result: Managing wealth was never so rewarding.

Shalini S. Dagar & Saumya Bhattacharya        Print Edition: Nov 18, 2007

When Rohit Sarin decided to leave a plush banking job five years back to start Gurgaon-based boutique wealth management firm Client Associates (CA) with partner Himanshu Kohli, little did he realise it would turn out to be one of the most ingenious moves he has made. “There was a very stark opportunity in the market when we started out five years ago. Business families at the very top of the pyramid had no real advice,” recounts Sarin, 36.

Today, CA, with its 350-odd clients, has captured a nifty slice of a still emerging market. And with the Indian economy continuing to grow at over 8 per cent, after showing scorching growth for over four years now, there is every reason to plan for expansion.

 

 Rohit Sarin: Partner/ Client Associates

Sarin, too, is planning to add 10 people to his team in the next year. Seems quite a breeze, but Sarin assures us it is quite a challenge in the rarefied field of wealth management.

“We are looking for ‘Birbals’ (advisor to medieval Mughal emperor Akbar) who can advise the clients with wisdom and can act as private chief financial officers so that the stress of managing wealth is delegated,” he says. And such people are tough to find.

Reason: To function as an effective wealth manager, a number of attributes are needed (see It’s Not All About Money, Honey). Some of those skills reside in existing industries but the complete combination is quite difficult to find.

Jobs in Plenty

But first, a peek into the burgeoning demand for wealth managers. According to Capgemini-Merrill Lynch Wealth Report 2007, the number of high networth individuals (HNIs)—those having an investible surplus of over $1 million (Rs 4 crore)—rose by 20.5 per cent in India from 83,000 in 2005 to 100,000 in the year 2006.

Many in the industry believe these are extremely conservative numbers. Actual consumption data indicates much higher numbers. A few reckon these could easily be in the range of a million millionaires. And a healthy growth of 18-20 per cent in the number of such millionaires is expected to sustain in the coming years as the economy obliges.

“The typical number of clients a wealth manager can effectively handle is not more than 25-30. That straightaway translates to a requirement of more than 3,000-4,000 wealth managers,” says Ian Gore, Head (Human Resources), Citi India Cluster.

Currently, the supply of good quality wealth managers is in the three digit range, say industry watchers. Sharad Sharma, Country Head (Private Banking), BNP Paribas, India, agrees. “There is already a discernible gap between the demand and the supply of client-facing professionals. As we expect a surge in demand in the next few years, there may be an acute shortage of the right talent over time.”

Shaping the Talent

 
Anup Bagchi: Head (Global Private Banking)/ICICI Bank
And the industry is already feeling the pinch on this count. The way out? The growing industry is now fashioning wealth managers. Two of the critical requirements for a wealth manager, according to Anup Bagchi, Head (Global Private Banking), ICICI Bank, are “client engagement skills and technical skills.”

While both can be honed with in-house training, for technical skills alone, the existing financial services industry—retail banks, brokerages, mutual funds or insurance companies—is a good hunting ground. These employees have at least basic level technical skills (knowledge about products and services being offered) which is crucial to wealth management. Most people are hired on a referral basis or from direct industry contacts. Sometimes, in case of experienced people even executive search firms are used.

Nevertheless, these potential employees are only partially ready “as their exposure is often limited to select products or services,” says Bagchi, who plans to add 200-250 managers a year in the coming years in line with the bank’s ambition of targeting the entire mass affluent space. ICICI Bank has partnered with 40-odd business schools which have private banking as elective courses. The bank also provides basic training to the deans and professors of these schools. These B-schools then have the potential to provide somewhat trained hires.

 It’s not all about money, honey

 Here are the desirable attributes for a wealth manager.

  • Strange it may sound but, good old-fashioned ‘wisdom’
  •  Analytical skills to make a financial diagnosis
  •  Ability to be a methodical self-starter
  •  Strong code of ethics and value system
  •  Sound decision making capabilities; not fickle-minded
  •  Long-term perspective on career and growth akin to “banyan trees”
  •  Good presentation and communication skills

Yet despite previous training or experience, most newcomers need some handholding initially ranging from three months to a year depending on the complexity of tasks a firm handles. As Sarin cautions: “You may be able to hire people with hefty salaries but that does not mean that they will be able to build the book for you as well.”

Hence, most of the players have in-house programmes to improve knowledge about products and compliance-related issues. These programmes relate to modules on asset allocation, market trading and client profiles. Since it is a rapidlyevolving industry with new products coming in, “a basic yearning to learn,” too, helps, says Abhay Aima, Country Head (Equity, Private Banking & Third Party Products), HDFC Bank.

Seeking Rooted Confidants

However, the base line still relates to people skills as at the higher end especially, the whole business is based on trust and faith. “It is important to keep in mind that we are clientfocussed not product-focussed (industry),” says Sharma.

Soft skills—whether it is just plain and simple ability to listen, empathy to the needs of the client or the ability to stay focussed in their own career to develop deep abiding relationships—are valuable attributes for a private banker as the whole business thrives on trust and faith. Sarin couldn’t agree more. “We look for people who are like banyan trees,” he says referring to the ability of the tree to drop more and more roots the longer it stays.

Some of the more successful teams in the industry are the ones who have seasoned professionals.

 
 Jaya Sharma: Citigold Select Banker/ Citibank India
Take the case of Jaya Sharma, 32, who has been in a slew of wealth management roles during the last seven years at Citibank India. “The most important factor is the number of years on the job and the trust and relationships you build with your clients,” says Sharma, who is now a Citigold Select Banker. Not surprisingly, she terms soft skills training as paramount to her growth and treasures her training modules on being a trusted advisor and on learning the fine art of networking.

For Sharma, who handles about 35 clients at Citibank at present, the growth story has been an interesting journey into the minds of HNIs and, keeping pace with the changing requirements of the clients a challenge. While MFs were the flavour of the season in the year 2000, the clients have become more adventurous and clued-up now. While the stock market swings on a roller coaster; it is wealth managers like Sharma who keep their clients rooted to the sound investment ground. And this ability to stay focussed is likely to become a differentiator as more players enter the market and some of the existing players go extremely aggressive with their ramp-up plans.

For those waiting in the wings, the industry stalwarts paint an upbeat scenario. Gore points out that the economy “presents a great opportunity for individuals to make a career in wealth management.” Though the job profile offers starting salaries in the range of Rs 6-8 lakh per annum, the intangible perks are equally alluring. “Over time, you build lasting relationships with clients, and, significantly, there is much to learn when you interact with them,” adds BNP’s Sharma.”

By all accounts, it pays to manage wealth for others.

Advantage Analytics

Data management is the new recruitment buzz.

 Fact Box

Who’S Hiring: Genpact, Infosys, MarketRx, IBM, TCS, Wipro, Citigroup, HSBC, McKinsey, Goldman Sachs, etc.

Who’re they hiring: MScs, BScs in Statistics, BTechs, MTechs, CAs and MBAs in Finance

At what level: At all levels: Fresher’s level, mid-level (two-to-three years of work experience), and senior (more than eight years of experience)
 At what salaries: At fresher’s level, the salaries range between Rs 5 and 6 lakh p.a. Mid-level executives can get anywhere between Rs 15 and 20 lakh p.a. Senior level executives (CXO level) are paid upwards of Rs 50-60 lakh p.a.
 What are the numbers like: The attrition rate in the analytics space is at around 10-15 per cent. The industry currently employs over 7,000 professionals and the demand is likely to grow at 30-35 per cent over the next three years
With effective data management taking centre stage across industry verticals, there is a spurt in demand for analytics. Says Kris Lakshmikanth, Founder CEO & Managing Director, The Headhunters: Analytics can empower an organisation with crucial information against upcoming business obstacles by revealing latent trends and capturing insights, upon which they can base their strategic plans and operational policies.

"The demand for analytics has grown tremendously in the last three-to-four years. However, the number of people joining the companies as analytics is still very low. "With India positioning itself as a favourite offshoring analytics destination, the demand for analytics talent pool is only going to rise steeply in the next couple of years," adds Lakshmikanth.

Manu Kaushik

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