Private banks have reached a point where they must think seriously about how they can attract and retain the next generation of talent. I’m seeing a lot of firms push this as a priority issue, and the urgency is a response to three critical issues:

1. The next wave of millionaires is getting increasingly younger, and set to inherit $105 trillion by 2048
2. The population of private bankers is diminishing, with 50% due to retire in the next 10 years
3. There are not enough private bankers progressing through the ranks to fill this gap

It’s a supply and demand issue with a glaring worst-case scenario: a talent void that forces the heirs of the ultra wealthy to walk away from your firm and find a new home for their assets.

Five strategies to secure next generation private banking talent

Without a doubt, the firms tomorrow’s wealth inheritors will be drawn to are ones where they can sit across the table from someone who looks and thinks like them. Over half ($61tn) of ‘The Great Wealth Transfer’ will be going to Millennials and Gen Z. In other words, your future client base will be dominated by digitally fluent, globally educated and fiercely ambitious individuals.

They won’t want the legacy family banker from their grandfather’s time. They’ll need someone with cutting-edge ideas who can cross-sell banking solutions and cover not just private banking, but also corporate and investment banking needs.

Whether you meet that demand entirely depends on if you can catch the next generation of private banking talent. Firms having the most success are doing five things differently. 

Hiring from non-traditional backgrounds

Hiring from non-traditional backgrounds is your best chance at breaking away from that little black book of names that keeps you hiring the same profile every time. 

I’ve seen UBS have great success here. They’re bringing in high-potential candidates from outside the industry, putting them through a rigorous private banking training programme to build knowledge and capability, then pairing them with a senior private banker to accelerate their development.

An example of this is the bank’s targeting of individuals from non-traditional backgrounds, e.g. a former BMW salesman serving VIP clientele in the GCC, who has the network, the acumen and cultural fluency to connect authentically with clients. With the right upskilling, this individual becomes a banker of real strategic value to the firm.

The buddy model of partnering juniors with seniors is especially important for protecting succession planning, because when a senior banker eventually retires, it means there’s a ready-made successor who knows the clients and keeps the book with the firm.

Capturing talent earlier

To win the battle for new private bankers, firms are capturing talent earlier and earlier. In practice, this looks like investing heavily in graduate schemes, building university partnerships and investing in their presence at Freshers fairs. 

These are smart ways to get in front of the next generation and rebrand the profession, showing that it’s not something reserved for grey hair and mahogany boardrooms, but a field where young, tech-savvy professionals can build a career and thrive.

Providing flexible work models

Flexible work is a key differentiator in the fight for next gen talent. Hybrid models are an expectation today, particularly for younger professionals who value autonomy and balance. Offering it signals a firm understands how work is evolving, and respects its talent.

Not all banks agree. Some firms, JP Morgan amongst them, are mandating a full return to the office five days a week. Only time will tell how sustainable that is, but the risk is by failing to adapt your workplace to the needs of future bankers, you may also lose relevance among future clients.

Looking beyond the “finished article”

Chasing the “finished article”(the established private banker with a self-generated book) I believe is an oversight – for several reasons:

• Assets are stickier than ever. Banks work hard to institutionalise client relationships so assets don’t leave with the banker. The “finished articles” book often has little portable value. 
• Business plans rarely deliver. At interview, asset transfer numbers are routinely overstated; our own research shows only 18-25% actually move.
• Low incentive to move. If a banker truly owns their clients, why start from zero elsewhere? Unless something has gone wrong, or the offer is impossibly rich, they’re unlikely to jump. When they do, firms end up in costly bidding wars.

Instead, firms should focus on rising stars with the raw skillsets of great private bankers: strong relationship management, polished presentation, cultural fluency and a hunger to succeed. With the right training and senior mentorship, these hires can be moulded into the bankers of tomorrow, proving more loyal, more driven, more cost-effective and more valuable than today’s “finished article.”

Rethinking compensation models

Traditionally, junior bankers inheriting client books see little reward for the value they create. From a retention perspective, that’s a big risk.

Forward-looking firms are fixing this by rewarding their junior bankers fairly for sustaining and growing relationships. Meanwhile, boutique firms and family offices are raising the bar with formula-based pay linked to individual performance. For the next generation, that’s far more appealing than a discretionary year-end bonus that’s tied to the mood of your boss, the health of the bank, and the performance of thousands of other employees.

My advice for private banks is to review your comp models and ensure they’re competitive. If you can’t promise the next generation of talent that their efforts will be rewarded on their own merits, plenty of smaller, nimbler firms are ready to step in and do it for you.

Winning next gen clients means winning next gen talent 

The next generation of wealth looks very different from the last: social media sensations, tech entrepreneurs, and heirs in their twenties who want to make their own choices, not that of their forefathers’. If your firm doesn’t have the talent who can resonate with this generation, you’ll lock yourself out of the future client pool. 

Waiting to act is the most dangerous thing you can do. The firms already acting will secure the advantage. Some Swiss boutiques, for instance, are paying bankers into retirement so long as assets stay with the firm. This incentivises a high-quality handover to juniors, protecting client relationships and the firm’s future pipeline: it’s a win-win-win. 

The battle for next gen clients and next gen talent is one and the same. If you’re looking to secure the exceptional people who can win the confidence of tomorrow’s ultra-wealthy, get in touch with me.