Opportunities for both permanent and contract risk professionals remain high. In this article we look at some of the main areas of hiring and the sought-after key skills.
Banks, asset managers, specialist investment firms and high frequency trading businesses have all been hiring since the start of the year, and whereas some verticals in financial services have seen lower job volumes, demand for risk professionals has remained high, particularly within the quantitative analytics and modelling space.
“As we move past bonus season we anticipate senior candidates to move, but with a heightened level of caution due to Brexit-related uncertainty and likely operating model changes at strategic levels as commercial footprints are finalised,” said Ben Litvinoff, Associate Director at Robert Walters.
“At mid, senior, and junior levels, we expect to see the merging of mathematical and quantitative theory, product understanding and technical capacity as employers look for ways to merge role accountability, and the financial services sector pushes for further digital and data efficiency.”
Which candidates are in demand?
Skilled quantitative risk professionals are in high demand as well as candidates who are able to deliver credit risk modelling support to wholesale and retail banking clients with PD, LGD and EAD model development, validation and stress testing.
“Many candidates we speak to are seeking to move from these environments to investment banking, but facilitating these moves continues to be challenging. SAS, Python, MATLAB and C++ remain the languages most commonly sought after,” Litvinoff continued.
On the investment banking side, employers are seeking professionals with around 5-7 years of experience, to complement teams in valuations. Candidates with pricing knowledge, quantitative skills and product exposure, coupled with a control mindset in teams managing CVA and wider XVA (value adjustments) are also in demand. Successful candidates have potential future exposure (PFE) modelling capabilities and good stakeholder management skills enabling them to engage with Product Controllers, as well as Market and Credit Risk functions.
The third area where job volumes have increased is operational risk and control, as larger clients push operational risk management into product/functionally aligned teams i.e. foreign exchange, fixed income and private banking rather than overarching teams.
Conversely, in some of our mid-cap and niche investment management clients we have seen enterprise risk management teams seeking individuals with wider skillsets, encompassing credit and liquidity risk management, RCA delivery and ICAAP requirements. This increases the expectation on operational risk specialists to understand more of the external regulatory environment, reporting, and regulatory capital requirements.
In the first quarter, operational risk hiring focused on supporting regulatory-driven roles, for the first and second lines of defence across banking and asset management.
“We have seen a marked uptick in VP and Director-level opportunities with candidates selected for their ability to challenge the business pre-execution,” Litvinoff continued
“On the buy-side, asset management firms recognise the lack of support they have within this space and are in process of bolstering functions and adding checks and balances to their order management systems. Asset management operational risk specialist candidates are in short supply.”
In the credit risk space, most hiring has been at more junior levels, with candidates who have counterparty credit experience in capital markets, bespoke lending, and structured finance all in demand. Quantitative Analysts are also proving to be highly sought after.
Despite the uncertain geo-political landscape, lending and subsequently portfolio management of counterparty exposures continue to drive hiring of both permanent and temporary professionals. Demand here has been hard to meet as the best candidates are aware that being the newest member of a team or function which may be headed offshore in the near future will not offer career advancement/dream long-term contract. We have, however, already seen more willingness to initiate searches with bonus season coming to a close.
Market risk hiring has been more focused around onboarding analysts and associates on the permanent side with contractor hiring targeting very specific skills in the trading environment.
“We have been tasked with delivering quantitative MR product SMEs and those with front office quantitative and development experience at very solid daily rates (c£1000 p/d), Litvinoff said. “We have also seen hires made by US businesses to support SR117.
“Similarly, in the credit risk quant space, clients need fluency across major programming languages for almost all hires, as reporting and controls positions in the UK diminish and data and automation opportunities provide businesses with key wins.”