Private bankers work in the private banking divisions of large retail banks, in investment banks and in wealth management firms. They provide personalized financial services primarily to high-net-worth individuals (HNWIs). In essence, private bankers are personal financial advisors for the very rich. They meet with clients to define investment goals and then work with financial analysts and other professionals in the firm to create individualized investment strategies to meet those goals.
After defining a strategy, private bankers execute the strategies by selecting appropriate mixes of securities and investment products for the client portfolios, which they then manage and adjust on a continual basis.
In addition to investment advising and portfolio management services, many private bankers oversee deposit and cash management services, credit and lending services, tax planning services, trust services, retirement products, and annuities and insurance products. Many private banking divisions in large banks handle virtually all aspects of clients' finances. A private banker often works with relatively few clients to provide the focus and personalized service that private banking clients often demand. In some firms, private bankers focus on managing client portfolios while relationship managers handle other client needs.
Many private bankers begin working in entry-level financial analyst positions in wealth management firms, banks, brokerages or other organizations in the securities industry. Many financial analysts study stocks, bonds and other securities to produce financial plans, analytical reports and recommendations for private bankers, portfolio managers and other senior investment professionals in the firm. With experience and a record of high performance, a financial analyst specializing in investments can rise into a private banker position.
Other professionals in the field begin working as personal financial advisors serving retail clients at banks and other financial services firms. Personal financial advisors do much of the same work that private bankers do, but they typically deal with clients who do not have the wealth to justify the cost of the highly personalized services private bankers typically offer. A record of success as a retail-level advisor can lead to a position as a private banker.
A bachelor's degree in a business discipline or another relevant subject is a basic qualification to work as a private banker. However, in most cases, a bachelor's degree must be combined with substantial work experience to qualify for a position in this field. Most employers prefer to hire experienced candidates with master's degrees in business disciplines such as finance, accounting or business administration. Many employers also look for experienced job candidates who have graduate degrees in mathematics, statistics or law. Coursework in subjects such as taxation, risk management, investing and financial planning are especially valuable to prospective private bankers.
Many employers seek private bankers with one or more professional certifications relevant to the field. The Chartered Financial Analyst (CFA) designation, awarded by the CFA Institute, is one of the most widely respected professional certifications for investment professionals. It is available to candidates who have at least four years of qualifying experience.
The Certified Financial Planner (CFP) designation, awarded by the CFP Board, is another highly regarded certification common among private bankers. The CFP designation requires two years of financial planning experience or three years of qualifying professional experience.
The Certified Trust and Financial Advisor (CTFA) designation, awarded by the American Bankers Association, is designed for trust and wealth advisors. There are several paths to the CTFA designation; the shortest path requires three years of wealth management experience and completion of an approved training program. Each of these certifications requires candidates to pass one or more examinations.
Private bankers typically must obtain appropriate licenses from the Financial Industry Regulatory Authority (FINRA), which is responsible for oversight of securities firms in the United States. Many private bankers require Series 7 and Series 63 licenses. Other licenses may be required, depending on the position. Private bankers who intend to deal with life insurance, variable annuities and related products may also require appropriate licenses from their local state insurance boards.