Would you consider retail banking?

John Pierpont's picture
Rank: King Kong | 1,853

Hear me out before you shit on me/this post...

If someone were interested in getting up to the upper exec/c-suite level of a super regional bank or a national, do you think a stint in retail banking would be time well spent. The motive would be to gain a holistic understanding of how a bank operates at all levels and be able to leverage that experience when in a leadership position.

Comments (22)

Apr 26, 2019

Aren't you already in banking?

Apr 26, 2019

Yes but the idea would be to spend time in another line of business of a bank to have a more well rounded banking background. From my pov, retail banking is an entirely different animal

Aug 7, 2019

Succeeding as a branch manager and any other consumer facing role in retail banking requires soft skills and nothing else. there are ways to prove you have those that don't include taking four steps back career wise. You have a college degree, don't jump into a job that requires a GED.

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Apr 26, 2019

If you mean going into consumer banking, I would say no if you are already in commercial lending. In my opinion you're better off focusing on excelling at whatever line you're in instead of looking for rounder experience. If you're not happy in commercial lending then I'd consider it. Consumer banking is about managing people. If you advance in credit or originations you can definitely get to executive level. If you don't like commercial lending or credit, maybe look at finance.

Apr 26, 2019

It honestly depending what type of regional bank is under consideration.

Commercial lending is mainly... well... commercial. So to argue that it gives you a "good enough" insight into consumer banking is not really accurate. Consumer lending is about managing people but there are still nuances / strategy / forecasting / etc to be done at the consumer level, which has its own characteristics and set of constraints compared to b2b lending.

I think you're correct in saying if you want to be a CxO in COMMERCIAL LENDING you don't really need the consumer experience.

If OP is talking about CxO of a regional bank, which has considerable consumer, commercial, etc. exposure, then I would argue it is valuable.

Apr 26, 2019

@HotelCREwiz I definitely see your point but retail/consumer banking is worlds different from what I do now. My role now is probably 70% underwriting and extending credit at b2b level and 30% strategic dialogue with companies around m&a strategy, succession plans, cap structures, and the like. Being down in the branches, which sounds seems awful, deals with the day-to-day customers, SBA loans, mortgages, and small time advising. I say awful because branches seem to deal with the angriest and unruliest of customers.

I think my goals align more with the C level of a regional bank. I get that a lot of people poop on the idea of branches but it's where a large portion of the banks money comes from. I probably should know the income stream breakdowns more solidly, but I'm still in the brainstorming stages.

I'd be interested to know if anyone knows of someone that has gone this route or is currently doing it. It doesn't seem to be widely done but maybe that's because growing more senior in your vertical doesn't transfer well into another.

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Apr 26, 2019

Didn't the former Wells Fargo CEO John Stumpf start from the bottom as a teller? I think Richard Davis started as a teller too before becoming the CEO of US Bank.

Like all walks of life, the cream will always rise to the top.

Array

Apr 26, 2019

TIL Stumpf is considered cream...

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Apr 26, 2019
John Pierpont:

Would You Consider Retail Banking?

If I had to pay rent or put food on the table, of course.

If I already had a career, no.

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Most Helpful
Apr 26, 2019

There's nothing unambitious about trying to get a top leadership position of a retail banking operation, just like there's nothing wrong with aiming for any corporate C-suite job. The question is how are you trying to get there? Yes there are rags to riches stories, but most CEOs of retailers didn't get their start working the cash register.

If you're considering applying at random to branch-based retail banking roles so you can start your climb, that sounds like a terrible idea. But if you can network at your current bank with leaders of the consumer part of the business, then by all means express interest, ask how they got there, and ask about the right way to get exposure to that business. If they suggest you spend some time at a branch then I would just want an explicit understanding that they want you to do it as a learning experience on your way to a leadership role back at the home office.

Don't take an un-calculated step backwards into retail. Leverage your finance experience so you can move into a role with a real trajectory.

Apr 26, 2019
:

Don't take an un-calculated step backwards into retail. Leverage your finance experience so you can move into a role with a real trajectory.

Thanks! This hit home the most for me. I think the way forward is to continue talking with managers and execs above me, expressing interest in a well-rounded background and garner input into how best to attain.

Apr 28, 2019

A top (former) guy at my bank attributes a lot of his success to doing a rotational program which put him through a lot of retail experience. But obviously this situation is different than going from CB --> RB. I think having experience in your bank's fintech-focus areas (strategy) would teach you a lot about retail. YMMV.

  • Analyst 1 in CB
Sep 4, 2019
HighlyClevered:

Leverage your finance experience so you can move into a role with a real trajectory.

If only we knew what roles have real trajectory

Apr 26, 2019

I don't think actually working at a branch is necessary to climb in corporate roles. There are people who start in the field and work up into home office roles but I think that's the exception. At least at my bank.

Apr 26, 2019

So my first bank job ever was at a retail bank, this was when I was a college student. It was a chain of banks which was split into regional divisions, and within each regional division, you obviously had multiple smaller banks spread over the area. This was out in nowhere, and there were around 700 employees for that regional bank, all in all.

Because investment banks and such are pretty much never, ever out in those parts of the country, most of these retail banks (or the parent company) also have smaller corporate divisions, that mostly handle the business clients in the area. And with the rapid development in digitalization, many of these credit banks are dealing less and less with regular people these days - and focusing more on regional business clients.

I would say that the perk of this, is that you get to know pretty much every and any business in the area, and learn the economy very well - I know lots of bankers that staid back home, and eventually landed pretty nice industry jobs in surrounding areas.

Now, for the career aspects: From what I understand, it is most definitely a "company man" type of career, with a bit longer time horizon than what you'd see elsewhere in finance. At the retail bank I worked at, all the CEO's had 20-30 years in the same company, and climbing the ladder internally. There's been 3 different in the past 20 years...

I also know that the total comp for them is/was around $500k-$800k / year, depending on bank performance. You pretty much need to reach a C-level position, in order to get pay that resembles anything close to high-finance. (should be noted that this was not in the US - and tax records are open source here. The compensation levels may not translate to what's normal in the US).

But I think it's a completely different environment, and tbh there's a ton of community work / aspect for those kinds of banks.

The obvious problem is that there can only be so many C-level execs at these companies, and you're fighting against a ton of other people - for pay that is comparable to senior VP pay on wall street -and there's A LOT more of those, than c-level retail bank executives.

I think making the jump would make sense if you're moving somewhere that is otherwise devoid of regular finance jobs, and you have a real shot at the very senior positions.

Apr 27, 2019

I think going directly into the business (finance/marketing/strategy/ops) would be better than starting out as a teller or rep or something. They are just completely different career paths.

Apr 29, 2019

Last year, I was approached for CEO role for a banking group - that is one tier below my current firm. Previous experience prior to someone reaching out to me was - I had covered 1) corporate banking - mainly commercial lending, 2) principal investment - portfolio operation for financial service firms, and 3) investment banking - advisory and fundraising - at this point.

The CEO role for me, was expected to 1) put together business plan, 2) execute growth areas, 3) financial restructuring, and 4) put together M&A plan for a foreign bank to take over. So from my limited experience, I can say that you don't need to go to a retail bank - just for the sake of going after leadership role. Other people have similar experience as me when applying for CEO roles for a bank.

A few things that can really help if you want to be prepared:

  1. Have relevant experience of a transformation exercise.
  2. Have reach to an investor base that your prospective employers may be looking for fundraising. Some favor with people who had worked at DFIs (World Bank, IFC, MIGA).
  3. Have board presence, previous experience in managing leadership roles in financial group - not necessarily retail bank's management team.
  4. Or have relevant experience as consultant, banker, investor, running and investing in a bank.
  5. Build strong relationship with BOD members. Or find someone who can refer you.
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Apr 29, 2019

Thanks for sharing your experience. From what you've shared, it seems that I would be better off going up the food chain rather than down, so to speak. Gaining more experience in IB/M&A may provide more of the top level experience that was sought after in your case.

Mind if I PM you a few questions?

Apr 29, 2019
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