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Thursday, 5 February 2009

View from the top: how to survive 2009

In the first of his regular “View from the top” series, our new columnist shares his insights on how to survive the year ahead in finance. The author is a senior banker based in Singapore, with three decades in commercial and investment banking at major international firms.

The full effects of the current global financial crisis will take their toll on the banking and financial industry this year in Asia. It's now time to take appropriate steps to ensure your survival for at least the next 12 to 24 months.

The safest sectors

There is still a need for bank staff who specialise in risk management, risk control and internal audit. However, if banks continue not to book new risk instruments, loans etc, they will not need so many transactional-type credit or risk analysts. Banks have no qualms about laying off these people first and rehiring them later when they are back in the business of making loans. Risk jobs are therefore not totally secure, but they are at least still safer than other support functions.

In my own bank, loan-workout specialists are all overstretched and I know that other banks are still recruiting in this area. To enhance your survival chances and to pick up new skills along the way, it may be wise for relationship managers or sales executives, if possible, to request transfers to these departments. Accounting and credit skills are of course a pre-requisite.

If you are employed in the marketing of investment products, or in corporate or treasury sales, you will probably find it extremely difficult to do well in 2009.

Get close to customers and back to basics

Employers want to maintain their customer base for when the economic recovery arrives. To survive as a banker today, you will need to be very close to your customers and be recognised as the key customer-contact link to your bank.

After the current crisis is over, the financial world will be going back to quite basic banking: taking simple deposits, making straight forward loans, and providing trade and transactional banking services and foreign exchange hedging to core customers. Gone are the pin-striped investment bankers who structure complex deals and sell the risk to gullible investors and less sophisticated banks. Gone are the bankers who are remunerated in the millions by packaging and selling risky instruments. These chaps have all made their money and are now happily retired in their beach homes. They may return one day when the world has forgotten that they created this mess.

Investment banker 2.0

The new investment banker will probably be a humbler financial/investment advisor with an MBA from a top school, who has good market contacts and is skilled at finding potential merger candidates. He/she will probably be working for a global wholesale bank that is also able to provide credit to back up its advisory capability. To survive as an i-banker in 2009 and beyond, you should seek employment with one of these rare surviving global wholesale banks (e.g. BOA/Merrill Lynch, J.P. Morgan, Standard Chartered etc). I doubt these firms are hiring right now, but they will be amongst the first to do so when the carnage is over.

Keep your head down

In the meanwhile, if you are just a normal commercial banker or front-line support employee, try to maintain a very low profile, especially if you can't meet your targets this year. Don't stand out as being difficult, a non team-player, or too expensive. Be careful not to be blamed or associated with any credit or trading losses. In these lean times, no losses will be tolerated and your bosses will be on the lookout for easy scrapegoats.

Remenber that your boss will be as insecure as you are and insecure people usually discard their moral principles to ensure self survival. It’s best not to trust anyone with sensitive information which could be used against you. Also graciously accept any pay or bonus cuts. You need to put your head down and show that you are a loyal hardworking, obedient and self-sacrificing employee.

Want to learn about life at the other end of the finance ladder? Look out for our forthcoming “View from the bottom” column, written by a young banker who has recently been laid off and is struggling to find work.

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