Commercial Banking Theresa Carr – Utopia High School Reach For Your Horizon
Commercial Banking Overview • Commercial banks provide banking services to individuals, small businesses and large organizations • More people are employed in the commercial banking sector than any other part of the financial services industry
Commercial Banking Trends • For decades, banks profited by simply holding customers' money and charging check-writing fees and interest on loans • Jobs were well defined and • stable • The paths to promotion were • clear and secure
Consolidation, competition, and technological change forced layoffs while creating opportunity Since 1995, more than 200 large and small banks have merged Commercial Banking Trends
Commercial Banking Trends • Today, a handful of recently consolidated giants—Citigroup, Bank of America, JP Morgan Chase—dominate the banking industry
Skills & Talents • Broad business understanding and people skills are needed • Accounting and writing skills are crucial • High grades less important than work ethic
Banking is Satisfying • In 1992, Money magazine surveyed 100 jobs in the United States • The job of banker was listed as the second most satisfying • Bankers love their jobs!
The Future is in New Areas • Because traditional banking is in decline the future of the industry lies in services and new areas • Many banks are now starting to compete against investment banks
Banks which specialize in a niche such a retail lending or global retail are doing better than more diversified banks Expect focused banks to continue to succeed and create more jobs Specialized Banks are Doing Best
You May be Traveling • New regulations permit interstate banking • Historically, you might not have been asked to travel much as a banker or deal with businesses in other states • That is changing rapidly
Middle-Managers Are In Demand • The shake-up in banking has left a shortage of good middle-managers • Other hot areas include loan review officers, technology specialists and auditors
Jobs • Jobs at different commercial banks vary according to the scope of their operations • Mega-banks offer a variety of positions, from hard-core programming spots to investment banking and trading • Small and regional banks tend to have a smaller range of more traditional positions • Loan officer • Teller • Credit analyst, etc.
Getting Hired • Many roads lead into the commercial banking world • At the bottom end, local branches hire for a number of different positions • At the corporate level, the large banks hire hundreds of people from college and graduate programs each year
Many bank executives start in this job Loan officers determine, based on the bank's criteria, who gets loans and who does not Must have people skills Salary range: $35,000 to $90,000 Loan Officer
Branch Manager • This is a great way to learn the industry • Salary range: $40,000 to $85,000
Bank Teller • The front line in the banking world • Extensive customer contact • Tellers must have a good feel for numbers, a willingness to handle large amounts of cash, and an attention to detail • There are more than 500,000 tellers in the United States; most work 9 to 5, and one-third work part-time • Salary range: $18,000 to $40,000
Programmer • Citibank boasts that it has more software programmers than Microsoft does • Responsibilities range from managing network systems to coding applications • Salary range: $35,000 to $150,000
Sales • An understanding of product development and investments • An undergraduate degree in finance, business, or economics gets you in the door • An MBA gets you a second interview • Salary range: $30,000 to $100,000
Trust Officer • The job involves helping clients with trust services, estate planning, taxes, investing, and probate law • This job requires diplomacy and tact • Salary range: $48,000 to $75,000
Accounting Marketing and advertising Commercial card operations Securities transfer Wire operations Private banking Cash management services Installment loans Loan servicing Correspondent banking Personnel Operations Communications Other jobs in banking involve
What's Great about Banking • Pay, portability, and promotions • Commercial banks increasingly have to match Wall Street salaries • You'll pick up skills that you can easily take with you to other jobs in finance • An MBA is helpful but not a prerequisite to future success
And Some More Positives… • Your degree doesn't have to be a highly prestigious one • Most banks aren't high-stress, difficult places to work • And it's not against the rules to be nice to your colleagues
The Downside • Fewer jobs and more uncertainty • Brokerages and virtually every other type of financial institution are on a unstated mission—to make the banking jobs obsolete • Bank on Longer Hours
High School Classes for a Commercial Banking Career • Career & Financial Management ½ year – ½ credit 1 year – 1 credit • Keyboarding/Word Processing 1 year – 1 credit • Accounting 1 1 year – 1 credit • Advanced Accounting 1 year – 1 credit • Business Law 1 year – 1 credit • Business Statistics ½ year – ½ credit • Financial Decision Making ½ year – ½ credit • Marketing & Management 1 year – 1 credit • International Business ½ year – ½ credit
Employers in our area • Bank One • Bank of America • Chase • Citibank • HSBC • UBS
Four-year Colleges Bachelor’s Degree in Business • College of Saint Rose • Rensselaer Polytechnic Institute • Sage Colleges • Siena College • Skidmore College • SUNY at Albany • Union College
Two-year Colleges Associate's Degree in Business • Adirondack Community College • Columbia-Greene Community College • Hudson Valley Community College • Schenectady County Community College
Links and Resources Career Information, Company Profiles and Contacts • Careers for Financial Mavens & Other Money Movers By Marjorie Eberts and Margaret Gisler, NTC Publishing Group, October 1998. A good overview of career possibilities for those with an interest in banking. • ABA Directory American Bankers Association, (202) 663-5000, Lists banks around the country. • Careers in Banking and Finance: How to Achieve Your Professional Goals. American Institute of Banking-California, (415) 392-5286. Describes many jobs in banking and their prerequisites. • Careers in Finance By Trudy Ring, VGM Career Horizons, Lincolnwood, IL., 1999. This book has an extensive section which talks about what work in banking is like and what types of people enjoy banking. • Careers in Mortgage Banking By Mortgage Bankers Association of America. In the Business and Finance Career Directory, 1993, Gale Research, p. 77-79. (800)-877- GALE. Cost: $18.
Links and Resources Career Information, Company Profiles and Contacts • DDJ Myers Executive search consultants in banking with a focus on asset- liability management, investment analytics and portfolio management. • How to Get Ahead in Accounting, Finance and Banking From Robert Half International. Order a free copy of this informative brochure online or call the corporate office at (415) 854-9700. • Resumes for Banking and Financial Careers By the Editors of VGM Career Horizons, Lincolnwood, IL, 1994, 1-800-323-4900. Has sample cover letters and resumes appropriate for applying for a job in banking. • What About Banking? American Bankers Association, (202) 663-5000. Discusses career options in banking, qualifications and salaries.
Links and Resources Organizations • American Banking Association Largest association of bankers in the United States. Holds a cool conference in Hawaii or some exotic place every year. A powerhouse on Capitol Hill and a publisher of a variety of career materials. • Bank Administration Institute The BAI is a leading sponsor of professional education in banking. Check out their website to catch up with current issues and questions in banking. You might also look into their widely read magazine called Banking Strategies. • Robert Morris Associates RMA is also the only financial services trade association that specializes in lending and credit risk information, research, and training. More than 3,000 commercial banks, thrifts, and other financial firms are members of RMA, represented in the Association by some 18,000 financial professionals (called Associates) in 50 states, Puerto Rico, Canada and numerous foreign cities including Hong Kong and Singapore.
Links and Resources Ideas and Know-How • The Death of the Banker: The Decline and Fall of the Great Financial Dynasties and the Triumph of the Small Investor By Ron Chernow. A thought-provoking book that explains why the world of banking works the way it does today. Power has migrated from the bankers to the customers. • Commercial Bank Management By Peter S. Rose. 1998. A classic text on banking. Covers the business, legal issues, asset-liability management and the future. • First Manhattan Consulting Group This consulting organization shares a lot of their ideas about banking online. A good resource and not a bad place to look for a job either! • Wharton Financial Institutions Center An excellent place to read up on academic research on banking. The Wharton Center sponsors an good set of online working papers and other materials on banking. • WWW Virtual Library: Finance An online compendium of web sites of interest to students and those who follow finance.
Links and Resources Magazines and Newspapers • American Banker This magazine carries lists of the largest banks, thrifts etc. in the United States. Good coverage of industry as well. (212) 943-5283. • Economist Widely read weekly covers world of banking, politics and art quite well. You have to read this if you plan to go into the field. • New York Times Sunday classified section in New York edition is renown for listing ads by investment banks looking for talent. Cost: $1.25 at newsstands. Also look at the Financial Times and CareerPath • Wall Street Journal The most widely read business periodical in the world. And it's on the net! You must register for the net version. Great way to keep up with what's going on in the markets and the world. Following tombstones and ads is also a good way to see which banks are involved in what types of activity this year. You may also be interested in Careers.wsj.com