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
Commercial Banking Trends
• Consolidation, competition, and
technological change forced layoffs
while creating opportunity
• Since 1995, more
than 200 large and
small banks have
merged
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
Specialized Banks are Doing Best
• Banks which
specialize in a
niche such a retail
lending or global
retail are doing
better than more • Expect focused banks
diversified banks
to continue to succeed
and create more jobs
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
Loan Officer
• 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
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 $75,000
Other jobs in banking involve
• Accounting
• Marketing and
advertising
• Commercial card
operations
• Securities transfer
• Wire operations
• Private banking
• Cash management
services
• Installment loans
• Loan servicing
• Correspondent banking
• Personnel
• Operations
• Communications
Major Players
Top 10 Banks, by 2004 Revenue
Rank
Bank
Revenue ($M)
1-Yr. Change (%)
Employees
1
Citigroup Inc.
108,276
14.3
294,000
2
Bank of America Corp.
65,447
33.5
175,742
3
J.P. Morgan Chase & Co.
56,931
28.3
160,968
4
Wells Fargo & Co.
33,876
6.5
140,500
5
Wachovia Corp.
28,067
14.7
96,030
6
Washington Mutual
15,962
–11.4
52,579
7
U.S. Bancorp
14,706
0.9
48,831
8
MBNA Corp.
12,327
12
28,000
9
National City Corp.
10,600
10.1
33,331*
10
SunTrust Banks
7,823
10.6
33,156
*2003 numbers.
Sources: Hoover's; Fortune 500; WetFeet analysis.
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
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Keyboarding/Word Processing
Accounting 1
Advanced Accounting
Business Law
Business Statistics
Financial Decision Making
Marketing & Management
International Business
½ year – ½ credit
1 year – 1 credit
1 year – 1 credit
1 year – 1 credit
1 year – 1 credit
1 year – 1 credit
½ year – ½ credit
½ year – ½ credit
1 year – 1 credit
½ year – ½ credit
Employers in our area
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Bank One
Bank of America
Chase
Citibank
HSBC
UBS
Four-year Colleges
Bachelor’s Degree in Business
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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
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Adirondack Community College
Columbia-Greene Community College
Hudson Valley Community College
Schenectady County Community College
Links and Resources
Career Information, Company
Profiles and Contacts
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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)-877GALE. Cost: $18.
Links and Resources
Career Information, Company
Profiles and Contacts
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DDJ Myers
Executive search consultants in banking with a focus on assetliability 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
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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.
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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.
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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
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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
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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