A Finance Talent Grab

Looking at national employment statistics, one might think that not much is happening with finance jobs. After all, about 6.7 million people were employed in those roles a year ago, and about the same number are employed today.

But beneath the surface, there’s a significant talent grab going on, as crypto and other fintech firms attempt to siphon talent, both super-experienced professionals and junior associates, from bigger organizations. 

The smaller firms are in an assorted pockets of finance. Some do credit-card payments, others manage cross-border transactions, and a couple have created crypto tokens or stablecoins, whose value is pegged to the dollar or other government-issued currencies. But to expand into other forms of finance, many need some form of bank license—a charter from either a state government or the US Office of the Comptroller of the Currency (OCC). "There is some urgency here,” says Kate Shattuck, a Korn Ferry managing partner and member of the firm’s Global Financial Services practice.

Experts say to win over regulators, these small firms will need to prove that they’re equipped with the talent to ensure they meet capital requirements, maintain effective governance, and protect consumers. “Many of the leaders, even the CEOs, are not proven entities to the regulators; they want to see banking credentials,” says Seema Brin, a Korn Ferry senior client partner with clients across financial services.

Over the past couple of months, at least half a dozen crypto and other fintech firms have announced that they’re applying for a license from the OCC. Only one crypto firm currently has a federal bank charter. The stakes, experts say, are particularly high, because the smaller firms want to get licenses—and the requisite talent—now, while the regulatory environment seems particularly favorable to crypto and other non-traditional finance products.

The smaller firms understand that they might get only one shot at securing a charter. Given the realities of political environments, the firms know that a banking charter isn’t something they can apply for, get denied, and just apply for again. “You want to get it right, because you lose credibility if you miss,” Brin says.

The smaller crypto firms are hoping that the idea of working for a faster-paced environment will appeal to seasoned executives. While the firms might not be able to provide the same salaries as bigger banks, they can offer the opportunity for big windfalls if the company expands rapidly or becomes publicly traded. 

At the other end of the talent shuffle is a push by private-equity firms trying to coax younger talent away from Wall Street’s biggest banks. The PE firms have sought to lure junior associates or recent or soon-to-be graduates of major banks’ training programs. Their pitch is usually straightforward: “More money,” says Mike Franzino, president of Korn Ferry’s Global Financial Services practice. The private-equity firms are looking to take advantage of the training the junior associates have received at the bigger banks.

Several large Wall Street banks are trying to tamp down on the practice, even threatening to fire junior bankers they’ve trained who accept a job offer within the first 18 months of joining the firm. “There have been some outspoken CEOs that are now looking for loyalty amongst their ranks,” says Radhika Papandreou, Korn Ferry’s president of North America.

Learn more about Korn Ferry’s Talent Recruitment capabilities.

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