Many people are interested in having a career in banking. There are many opportunities available to those who work in the banking sector, ranging anywhere from entry-level to high upper management. Working in the banking sector also means working in a field that is consistent and a reliable source of work and well-paid jobs.
Credit unions and banks have a variety of services and financial products available for consumers. The people that are employed within these banks and credit unions manage money transactions every day. These people are trusted to access customers’ accounts, loaning money and much more.
Having a career in banking provides you with many skills that can be used in different areas of the banking sector such as a branch manager, a teller, or administrative staff.
Banking Careers Are Booming
With the financial crises of the late 2000s, bank careers went into in a severe slump, making it difficult to find employment in this field. However, if you’re concerned that it’s going to be more difficult to find a job in banking than in other careers, don’t be.
Your concerns were warranted, but the worst of the crisis has passed, according to most experts. Making things even better is the fact that many banks and other financial institutions will be doing “catch up” hiring, to make up for the years when they did no hiring at all. So the next few years look extremely favorable for the field.
Keep reading our site to find out all you need to know about landing the career of your dreams.
Banks and credit unions sell and service a myriad of financial products, and collectively hold billions of dollars in assets, commercial and personal accounts, and policies. The people who are employed in various banking positions manage all manner of money transactions made by banks and credit unions every day.
Banks can be small, locally owned banks in rural areas, with local customers who are loyal to the bank owners and managers who are their neighbors. Careers at these banks tend to be very stable, longstanding jobs, with close relationships among the local residents and customers.
Banks can also be huge multi-national financial institutions that handle millions of transactions daily. Large financial institutions and credit unions offer various options for the person seeking a position in a financial institution, with vast opportunities for advancement and promotion within the large departments of the company.
• The history of banks and the people who work with money goes back to ancient times in Persia around the year AD 300 when “bankers” issued letters of credit to “borrowers”.
• The word “bank” comes from the ancient Italian word “banca”, which meant a bench or a counter. Italian bankers during the Renaissance times of high international trade plied their business of money changing and lending from “bancas” or benches set up as tables in bustling market squares.
In the United States, most banking business has been derived from English common law regarding banks, with significant changes over the centuries, particularly those that have become law after directives from Congress and other federal institutions.
Generally, banking business is defined as holding money for customers, paying money drawn on customers’ accounts, loaning money to customers, and collecting interest from borrowers. The same business model applies to credit unions and savings and loan institutions, with some exceptions for market focus in these firms. Banking for centuries was conducted entirely by the various staff employed by the banks, and accounts were recorded by the hand of a bank employee.
Since the advent of computers, the Internet, and EFTPOS (electronic funds transfer at point of sale) it may seem that computers might someday replace nearly all the jobs in banking in the past. Nothing could be further from the truth, as banks are bigger than ever, employ more people than ever in the past, and many jobs and duties must still be handled or overseen by a person.
• Banks and credit unions employ many people for various positions. At the core of a bank are bank tellers, bank or branch managers, loan and mortgage officers, credit analysts, and office or administrative staff.
• Larger banks employ many different levels of each of those five positions, according to the responsibility of the position. Additionally, larger banks also employ other company staff, such as human resources, personnel, payroll, information technology (computers and software), and marketing staff, similar to what would be found at any large company.
Qualities Required to Succeed in the Banking Field
People who choose to go into banking should be very well organized, enjoy numbers and money, and must have excellent math and computer skills. They should also have good communication skills, be good at dealing with people and be service-oriented. Someone desiring to go into the banking industry must be good with detail and numbers.
Financial institutions need to hire people who are trustworthy and honest as well as people who are able to read and calculate or balance numbers correctly. As the federal government regulates many aspects of the banking industry, individuals looking for careers in the financial industry should be able to adhere to all the rules and regulations that banks must follow.
• Anyone considering a career in a service industry should enjoy working with people and meeting their service needs. Working with people in a banking setting requires patience and acceptance of people from all walks of life and in all kinds of financial shape.
• Those who choose to do so will work with the specific transactional details of many different people. He or she will need to focus on the details of the transactions while making the customer feel satisfied and confident that the banking employee has successfully aided the customer with their service need.
• As the banking industry today is computer-automated and dependent on the Internet for many transactions, banking professionals must be computer literate and must be proficient with accounting procedures and accounting software. If the employee is a trainee or a newly-hired person without that skill set, he or she must at least able to learn. This is not a career for a dyslexic person or someone who does not enjoy accounting, mathematical details, or adhering closely to many rules and regulations.
A bank sells services and products that relate to money and interest, and these fields follow numerous and stringent rules. Add that to the many and various regulations, procedural rules, fair trade practices and consumer protections, and one can see that those who choose a career in banking should be comfortable with both the vagaries of the public as well as following many rules and regulations.
• A person with good people skills who is successfully able to troubleshoot issues and negotiate details might make a good mortgage broker.
• A person with good analytical skills who can see the “big” picture out of many numbers may make a great economic analyst.
• Someone who has the skill of managing people and encouraging teams of people to work well together might make a good bank manager.
• A lawyer who enjoys digging into the details of a fraudulent financial scheme, with pages and pages of numbers and contracts, may be a great legal analyst for a regulatory body.
• A person who prefers to work 9 to 5, Monday through Friday, perhaps because of family issues, may enjoy working as a bank teller at a small local bank.
• Someone who prefers to work nights, weekends, or varying shifts and who likes to work at a computer and a telephone may make an excellent loan officer for an online bank.
Banks offer many job opportunities, schedules, duties, and career path options for people today, for those with a high school education as well as those with secondary degrees. Most banking firms offer excellent benefits, including medical insurance and disability insurance, sick leave and vacation, and retirement options. Banking firms are highly regulated and supervised financial operations, making them excellent environments for a safe, pleasant, and rewarding places to work. These careers offer integrity and stability.
Advantages of Careers in Banking
There are many advantages to these careers. A position in banking is a good fit for a person who enjoys working with both numbers and the public. Working directly with the public can be both stimulating and exciting – but it takes a special person with a patient temperament. Working with the public can be difficult at times, but it can also be very rewarding. If you like numbers and accounting, but maybe don’t especially like working with the public, you might enjoy being an actuary. If you like working with people and counting money but don’t like a lot of responsibility and don’t like research, you might enjoy being a bank teller or a mortgage broker.
• Most retail banks, with a few exceptions, offer daily shift times and allow most employees to enjoy free time on weekends, evenings, and holidays. Usually, credit unions and banks are rarely open on holidays, but some call centers and retail banks, particularly those located inside a grocery store or department store, are frequently open on weekends and some evenings. The advantage for professionals who choose banking is that they can frequently choose to go to work for a bank with a schedule that will fit the needs of their personal life.
• Most banks have excellent benefit packages, offering medical, dental, and life insurance benefits as well as retirement plan options and personal or sick leave days and vacation benefits. Offices are always clean and pleasant, heated or air-conditioned, since personal comfort, both for the employee as well as for the customer, is of utmost importance. Banks are required to be regularly examined and audited and must follow many regulations and procedural rules and fair trade practices, making a bank or a regulatory agency a highly supervised and safe environment for all employees.
• Banking institutions offer many opportunities for advancement, and many banks will even pay for or reimburse the talented employee for continuing education courses, as well as courses toward a college degrees, with some requirements. Banks and banking regulatory agencies offer many opportunities for advancement for ambitious professionals. A skilled and knowledgeable banking professional will be in demand for promotions both within his or her own bank (depending on the bank’s size), as well as in other competing banks with similar departments. Banking is an industry that is not projected to go away in the near or far future–far from it. With the growing economy in many developing countries as well as our own, and with the continuous growth in population, there will continue to be a growing need for banks to hold and loan money, to make monetary transactions, and to keep hiring people.
Disadvantages of Bank Careers
One of the biggest disadvantages of bank careers is that serving the public can often be extremely stressful. Money issues are sensitive topics for most people, and customers can be quite rude and may become irate if the transaction is not correct or not handled perfectly to their satisfaction. A banking professional must be willing to work tactfully and carefully with a bank’s customers and must be able to confidently and correctly handle all banking transactions.
• To work in the banking industry, the professional must be good with numbers, cash, and money, and must be able to be patient and diligent in the accounting duties.
• This is not a career for someone who is casual with finances. The professional must be willing to take the responsibility of large amounts of money and must be able to carefully account for all the monies under his or her care.
• This is also not a career for someone who dislikes using the computer or an adding machine – nor is it a career for someone who hates to balance a checkbook.
• While there are a myriad of possible career choices in banking, they all center around two things: money, and the accounting of money.
To be successful, the banking employee must enjoy wearing professional dress such as a suit, dress shirt and tie for men, or a pantsuit, dress, or skirt suit for women, and dress shoes. A person who prefers the casual dress of jeans and t-shirts or a uniform shirt and khaki pants may feel out of place dressing to impress in a bank setting. The practice of a professional dress code for the banking industry came from the need to portray both an attitude of wealth and strength along with a conservative and professional attitude toward the money that the bank holds on behalf of its customers.
In the banking industry, casual dress may infer that “we play around a lot and don’t care what we do or what we look like”, but a professional, understated, wardrobe is supposed to convey the message that “we pay attention to detail and take care with your money”.
Some positions require that employees stand on their feet all day, such as a bank teller. Others demand that the employee stays at a desk, hunched over the computer screen, crunching numbers or formulating reports. A person would be well advised to determine all the negatives and weigh them against the benefits before deciding on a career in the banking field.
Banking Regulations and Regulatory Bodies
Banking careers are some of the most highly regulated jobs in the United States. Many different but related regulatory bodies and agencies oversee the banking and thrift industry in the US. These begin with the Federal Reserve Bank, which is the Central Bank of the U.S. Treasury, known as the “Fed”. Other regulatory bodies are the Federal Deposit Insurance Corporation (FDIC ), the Comptroller of the Currency of the United States Treasury (OCC ), and the National Credit Union Share Insurance Fund (NCUSIF ).
State and local banks are chartered by the states but can be overseen by both the FDIC and the Federal Reserve Bank. Of course, things are always changing in the banking industry, as there are always new rules and regulations being promulgated, such as the 1998 Homeowners Protection Act, which regulates mortgage insurance.
The Federal Reserve Bank is a uniquely structured central bank, with some private and some public aspects. Established by Congressional law, the Federal Reserve Bank was set up to both conduct national monetary policy and regulate banks, along with offering various financial services to the U.S. government, private depository institutions, and foreign official financial institutions.
Through these roles, the Federal Reserve Bank works to maintain the stability of the United States financial system, and ultimately, its economy. The Federal Reserve Bank, as a central bank, is also unique in that it regulates and monitors the currency, which is created by a totally separate entity, namely, the United States Treasury.
The Federal Reserve Bank (the Fed) is made up of 12 district banks across the country. The districts were formed when the Federal Reserve Bank was created in 1913 with the enactment of the Federal Reserve Act. Private member banks elect the members of the Board of Directors for the district’s or region’s Federal Reserve Bank. The members of the Board of Governors of the Federal Reserve Board are appointed by the President of the United States and are confirmed by the Senate of the United States.
The Federal Reserve Board and Banks are not funded by congressional monies or taxes. The majority of its revenues (90%) come from interest on and sales of U.S. Treasury securities held in their reserves portfolio. The balance comes from charges earned from financial services offered to their member banks.
The Federal Reserve Bank’s charter stipulates that the Fed is independent of the U.S. government in that “its decisions do not have to be ratified by the President” or by anyone else “in the executive or legislative branches of government”. Nevertheless, the Fed authority to operate was given to it by Congress and the Fed can be subject to the laws ratified by Congress and also the vagaries of political appointees.
During the second half of the 19th century and the first few years of the 20th century, the U.S. banking system was very chaotic. While national banks did exist, a true central bank structure did not exist, nor was there much government oversight. The bank panics of 1873, 1893, and 1907 forced the U.S. government to study the different types of centralized, public, and private banking systems of both Europe and North America.
The result was the Federal Reserve Bank system set up by the Federal Reserve Act of 1913, primarily a centralized bank, created to reform the banking system and control currency fluctuations.
However, the Act also provided the impetus for an “elastic” currency and a method of liquidity for member banks, both of which worked to stabilize the currency, the banking system, and the economy.
The Federal Reserve Bank serves as the Central Bank for the U.S. Treasury. The U.S. Treasury holds an account with the Fed and all monies paid to the Treasury and all payments made by the Treasury are cleared by the Fed bank. The Fed also conducts the nation’s monetary policy and manages the country’s money supply and the stability of the financial system by responding to currency and liquidity needs and being the lender of last resort.
The Federal Reserve Bank provides financial services as a clearinghouse to depository institutions, foreign institutions, and the U.S. Government. The main purpose of the Fed is to strengthen the standing of the global financial position of the United States.
Therefore the Federal Reserve Bank strives to keep a regulatory balance between private banks and the responsibility of the U.S. government by supervising the banking firms under its jurisdiction and also by helping to protect consumers’ credit rates.
This regulatory balance helps to limit systemic financial risk within the various markets in the U.S. In addition, the Federal Reserve Bank supervises approximately 900 state member banks and over 5000 bank holding companies, or company-controlled banks, which are institutions that are not supervised by other federal regulatory entities overseeing national banks, credit unions, and savings and loans, or thrift banks.
In 2009 the Federal Reserve transferred a record amount of cash, $45 billion dollars, to the U.S. Treasury, to stave off U.S. economic catastrophe. It also guaranteed a loan of $85 billion dollars in 2008 to halt the impending bankruptcy of American International Group (AIG), an international insurance company that was said to be “too big to fail”.
Certain economists studying the Wall Street collapse of 1929, and the ensuing Depression, stated that the refusal of the Federal Reserve Bank at the time to transfer funds to the U.S. Treasury, or to loan funds to collapsing banks, caused the subsequent Depression. Since that time, Congress has acted swiftly to make certain that another similar collapse and loss of banking stability will never happen again.
The Federal Deposit Insurance Corporation (FDIC) insures the deposits of up to $250,000 per depositor’s account held at banks that have purchased FDIC insurance for their deposit customers. The FDIC also works towards the stability of the banking industry and economy of the United States as well as compliance with fair credit regulations and the Community Reinvestment Act (CRA) by monitoring and supervising insured banks’ and savings and loans’ management.
With the Savings and Loan collapse in the late 1980’s and early 1990’s and the failure of the Federal Savings and Loan Insurance Corporation (FSLIC), the FDIC now also insures Savings and Loan institutions.
The FDIC employs many highly educated and experienced banking professionals. Careers include compliance and bank examiners, financial analysts and economists, and various information technology experts. Most positions require a four-year degree in business, finance, accounting, computer science and/or technology, along with experience in these fields.
Compliance examiners conduct various audits or examinations and investigations within the insured banks to protect the consumer from unfair trade practices, loss of civil rights, and the bank’s or savings and loan’s compliance with fair lending laws and the Community Reinvestment Act.
FDIC bank examiners audit and review the insured financial firms to protect the consumer from unsafe banking procedures, illegal acts, and to ensure the firms’ compliance with banking regulations. These audits will also analyze the policies and procedures of the insured bank, its management, and its general financial stability.
If examiners’ reports determine that an insured bank’s or savings and loan’s reserves or operations are deficient, the FDIC will mandate corrective action. In the case of a serious deficiency or imminent failure, the FDIC will mandate and oversee the closure of the bank.
FDIC economists and financial analysts research and study all aspects of the banking industry, including regulations, statutes, and deposit insurance. They also publish reports on the economic impact of various banking practices, legislation, capital risk management, and the financial markets. These types of banking careers at the FDIC can also include analysts, fraud and compliance investigators, administrative and management positions.
Information technology has become an extremely important aspect of banking, particularly since the advent of Automated Teller Machines (ATMs) and global banking. Prior to the explosion of the Internet in the 1980’s and 90’s, banking records and transactions were handled almost entirely on paper. Today, banking is almost fully automated. The FDIC technology experts focus on both security and anti-fraud systems for the automated activities of banks, as well as the development of better automation applications and practices.
The FDIC has many employment and intern opportunities for both academicians and college students, undergraduate and as well as graduate, particularly law school graduates. Current students in any subject field can apply under either the STEP program (the Student Temporary Employment Program) or the SCEP (the Student Career Experience Program).
Law school students can apply to the Summer Legal Intern Program. Law school graduates can apply to the FDIC’s Honors Attorney Program. All programs were developed in order to attract high performing students and graduates to the FDIC before and after graduation and to offer the student and graduate experience working within a government regulatory arm before deciding on a permanent career. Banking careers can range from work-study periods during the student’s university study term, to full-time summer jobs that can continue throughout the college year or that can become permanent.
Professors or academicians can be appointed to the FDIC as Visiting Academic Fellows (VAF) for a specific time period and for a specific research subject relating to the banking industry, or to proposed or existing legislation. Visiting Academic Fellows offer the FDIC highly educated and knowledgeable research resources outside of the government. FDIC economists and VAF professors study and publish theoretical financial models to project, enhance, support or direct FDIC operations with regard to banking and consumer protection.
Credit Unions’ deposits are insured by a similar regulatory body, the National Credit Union Share Insurance Fund (NCUSIF). The NCUSIF was formed by Congress in 1970 in order to ensure the deposits of credit union “members”. It is governed by the National Credit Union Association itself, but the insurance, like the FDIC, is backed by the full faith and credit of the United States’ government.
The primary function of the Office of the Comptroller of the Currency (OCC) of the United States Department of the Treasury is to charter, regulate, and supervise all national banks in the United States.
While the OCC is a federal regulatory arm, the agency is not funded by Congress or by the federal government. The OCC is funded by assessments made on all the U.S. national banks as well as any investment income gained by the OCC, including U.S. Treasury securities.
The Comptroller is appointed by the President of the United States with approval of the Senate, for a five-year term. The Comptroller directs all the OCC agency’s operations with regard to all national banks’ compliances with banking laws that regulate fair practices for consumers and fair access to credit and financial products, as well as safe and sound business procedures and operations. The Comptroller also sits on the board of the Federal Deposit Insurance Corporation.
The Office of the Comptroller of the Currency has the regulatory power to examine and approve or deny a new charter for a new national bank, branch, or any requested changes in a bank’s corporate structure. As such, the OCC can revoke a charter, remove an officer or director, or issue a cease-and-desist order to a bank that has been found to be in noncompliance, and even order civil monetary penalties.
Types of Banking Institutions
There’s a lot more to “banking” than most people realize. Not all banks are created equal, or for the same purposes. Some of them cater to individuals on a local basis, others are geared toward investors, some are for employees of a certain company or industry, and others focus on serving the banking needs of businesses, etc. Here are the most common kinds of banks found in the United States.
Local Banks
A local (or community) bank is a brick-and-mortar retail bank that services the banking needs of the local community. A local bank operates as a consumer and a wholesale or commercial bank. The bank manager is generally known to the community and is usually active in civic activities and even local government. This type of bank handles all aspects of banking activities for the community, including bank accounts, bill payment, money transfers, consumer and commercial loans, insurance and insurance services, and retirement and investment services.
Banking careers found in a local bank are tellers, bank managers, loan officers, credit analysts, and often, retirement and financial advisers. Local customers usually have their employment checks deposited here, borrow money for their homeowners’ loans and their auto loans, and keep their savings here. If the customer is a business owner, he or she may also have a credit line arrangement with the bank to operate the business. Local banks are typically chartered by the state of residence but can be supervised and insured by the Federal Deposit Insurance Corporation and the Federal Reserve Bank.
Most local banks’ employees know all their customers because the staff is also usually drawn from residents of the community. Because of this, the staff is frequently given much more authority to make decisions regarding the customers’ accounts and services than would be acceptable in a large bank’s branch location.
Many local banks are managed not only by a local resident who is the bank manager but is family-owned banks that have supported the local populace for a number of generations – with many relationship ties to the community. This can both help and hurt a local bank. The bank’s customers may have loyalty to the bank and may prefer to do all their banking locally, but the very fact that the bank’s staff knows everybody in the community may encourage substandard business practices.
Certainly, the older generation is familiar with and prefers to use the services of their own local community banks, the familiar staff, and the local bank’s products and paper accounts. The younger generation, being computer literate and rarely without a cell phone, is more and more inclined to avoid the “old fashioned” local-bank way of banking, preferring instead to use online and telephone services.
Online loan services and products, with their search engines that find the consumer the best interest rate for the desired loan, have made loans easy to obtain, and have rendered many local banks’ loan products obsolete. Large banks with credit analysts and loan packaging services can help any commercial business owner find the lowest rate with the best terms.
These innovations in banking, while making banking functions easier and faster for some, have helped to stymie the profitability of many local banks, and have forced many local community banks to close.
National Banks
A national bank is one that is federally chartered by the United States of America and is an investing member of its district division of the Federal Reserve System. A national bank is also insured by the Federal Deposit Insurance Corporation.
In addition, national banks’ charters and operations are supervised by the Office of the Comptroller of the Currency of the United States Department of the Treasury.
Most national banks are large commercial banks, with branches in most states and many of each state’s larger cities. National banks, due to their size, offer any and all types of banking careers found in any other bank, including tellers, bank managers and officers, credit and loan officers and analysts, fraud prevention specialists, information technology professionals, financial analysts, and salespeople. Banking careers in each of these departments will also offer many levels of management positions.
The system of national banks evolved out of the National Banking Acts of 1863 and 1864, during the presidency of Abraham Lincoln, at a time when a bank could charter either as a state or a federal bank. The two systems were not coordinated and banks had to follow very few regulations. Some state banks issued their own currencies, most notably, the Confederate dollar.
After the acts became law, banks that chose to operate in more than one state were required to charter with the Federal government and the U.S. Treasury, and were required to submit to the Treasury and the OCC’s examinations and audits. The act also strove to secure the national currency based on the securities in the U.S. Treasury, and to severely tax the state currencies in order to discourage any other currency than the U.S. dollar.
While the primary concern for these acts appeared to be to ensure a stable and growing national currency, the true reason was the need to finance the Civil War for the Union army. This was done by selling government bonds backed by the U. S. Treasury that were offered by the newly chartered national banks.
National banks in the United States today provide all manner of financial services and loans available, including checking and savings accounts; credit, debit and smart card services; money market funds; mortgage loans and mortgage services; small and large commercial loans and lines of credit; insurance products; investment products and services; stock and bond trading; and global banking services, including foreign cash services and international transfers and payments. Positions for banking careers in national banks can range from front office tellers to loan officers and credit analysts to bank officers and securities traders.
National banks work with the Federal Reserve Bank as investment banks to ensure stabilization and currency control for both the U.S. currency and the U.S. banking system.
Credit Unions
Credit unions are a type of bank that operates as a not-for-profit, tax-exempt, cooperative financial institution owned by the credit union’s depositors, or members. Depositors must be members of a designated group of people, such as military personnel (active or retired); employees of a school district or a city or county; members of a labor union or employees of a large company; or members of a religious group. Family members of such depositors can also be considered as members of a credit union. A member of one of these groups must “join” the credit union first before being able to open an account or borrow money.
Credit unions are governed by a board of directors, and the directors are voted onto the board by the members or shareholders of the credit union. Credit unions can incorporate under state or federal law, except in Wyoming, Delaware, and South Dakota, where credit unions cannot incorporate under state law and must be federally incorporated.
Credit unions offer similar services to their members, or shareholders, as do banks, but the services are usually titled a bit differently: savings accounts are share accounts, checking accounts are share draft accounts, and so on. Credit unions also offer loans, credit cards, debit cards, ATM services, online banking, and bill paying services.
Bank careers in a credit union are similar to a retail and/or a commercial bank, including credit union officer, loan officers, credit analysts, information technology professionals, and so on.
As credit unions are member services institutions, they are not regulated by any of the banking oversight regulators. However, this does not mean in any way that they are not as large nor as well-financed as many national banks. While a depositor’s accounts are insured up to $250,000 by the FDIC, credit union deposits are insured by the National Credit Union Share Insurance Fund (NCUSIF) for up to $250,000 per depositor. The NCUSIF, like the FDIC, is backed by the United States Government but is administered by the National Credit Union Administration.
In fact, the NCUSIF has a higher insurance fund capital ratio than that of the FDIC. Also, credit unions typically have a higher equity capital ratio than most U.S. banks. A credit union, by definition, is formed to service the member shareholders, and therefore, is said to be committed to helping the members’ financial status, rather than to simply reap profits. Credit unions often advertise that their interest charged on loans is lower than banks and that their service charges for share or draft accounts are also lower, due to their not-for-profit status and their member focus.
Most credit unions are comparable to local banks, offering services to the individual consumer, either for personal or commercial needs. Another type of credit union is a commercial credit union, which provides operational and clearinghouse funds support only to credit unions on a commercial basis.
Investment Banks
An investment bank is a financial institution that generates revenue by handling securities transactions for clients. Transactions can involve derivatives trades, market making, mergers and acquisitions, foreign money transactions, commodities, equity securities, and fixed-income products and instruments. An investment bank’s services are referred to as corporate finance.
Careers available in an investment bank include financial sales and financial analysts, credit analysts, traders, bank officers, fraud analysts, and many information technology positions. Clients of an investment bank can be individuals, commercial corporations or businesses, pension funds, or governments.
Prior to the Glass-Steagal Act of 1933, after the banking collapse of 1929 and the Great Depression, banks could mingle both their investment and commercial activities. The Glass-Steagal Act effectively separated the two financial services, and until 1999, all banks in the United States, unlike European banks, where required by law to choose which type of service to offer consumers. U.S. banks operated separately until 1999 when Congress passed the Gramm-Leach-Bliley Act.
This Act effectively tore down any barriers in the United States between commercial and investment banking financial services and operations, allowing banks not only to purchase or form insurance agencies, but also allowing for the consolidating of the two different financial entities into giant behemoth banks that now offer all manner of banking, investment, insurance, and financial services.
An investment bank operates with three different distinct divisions: front office, middle office, and back office, meaning that investment banking careers can be quite varied. The front office is where all transactions, such as purchases, sales, and services of the financial products and instruments, are conducted. This can include investment management, global currency trades, merchant and commercial banking, mergers and acquisitions, capital finance and capital raising, derivatives and commodities trading, and proprietary and customer trading.
The front office also includes a research division (not to be confused with research analysis for risk assessment, which is discussed below) in the middle office. The front office’s research department’s activities are highly regulated and must remain separated by a type of wall between itself and the bank’s investment activities since the reports on the bank’s investments can affect the bank’s financial status.
The middle office directs all corporate strategy and risk management activities of the bank, as well as financial control of the bank’s assets, its exposure in the markets, and its profitability. Directors and officers of the investment bank in the middle office oversee all market and credit risks to the bank’s financial statement and assure that no risk or credit errors or manipulation have occurred.
The back office of an investment bank manages and oversees all technology and informational support as well as all operations and transactions conducted by the bank. Compliance departments, maintaining all facets of the bank’s compliance with regulations, both state, federal and consumer, can be located either in the back office or increasingly, in the middle office, as part of the risk analysis of a bank’s operations.
Retail Banks
A retail bank is a financial institution that offers consumer services directly to the individual consumer, such as checking and savings accounts, cashier’s checks, credit, debit, and prepaid cards, and sometimes loans and retirement services.
Retail banks can be simply a local bank with no branches or a branch of a commercial bank or of a local or a state bank set up to service regional or local individual clients.
Credit unions and savings and loan banks could also be considered retail banks, although credit unions generally also conduct some commercial and investment services. Retail banks are referred to in the banking industry as the “mass-market” arm of banks, giving “one-stop shopping” opportunities to customers of the bank, and therefore keeping all financial transactions of the client customer within that one bank.
Increasingly, many retail banks have begun to include small business services, such as loans and lines of credit, as well as commercial bank accounts, in order to retain those individual clients who may also need small commercial services in addition to their personal accounts.
Banking careers available in a retail bank can include such positions as branch manager, loan officer, bank tellers, and various management positions.
Usually, a retail bank will be a brick-and-mortar bank (in a building and accessible to foot and drive-up traffic) but increasingly today it may be a “virtual” or online-only bank, servicing clients via Internet connection or telephone, only, with no street location for a customer to physically visit.
Retail banks can hold deposits, make loans, pay on checks or pay debits for depositors, and any number of banking services for consumers, but they generally do not perform any commercial or clearinghouse services.
Retail banks may also offer investment or brokerage services to sell and service investment products, including certificates of deposit, money market funds, mutual funds, and individual retirement accounts and services. Brokerage services at a retail bank are usually accomplished by only the handling of the consumer sale and contract rather than the actual brokerage and investment management services.
When a retail bank offers services such as commercial loans, retirement or investment services, it may accommodate its clients with these offerings through a third-party vendor, or the parent bank, possibly because of lack of staff or because of regulatory limitations.
Since the advent of the Internet, online banking access and ATMs (Automated Teller Machines), the savings and loan collapse in the late 1980s and early 1990s, and the financial meltdown of 2008, fewer and fewer retail banks are continuing as brick-and-mortar locations.
Increasingly, banks and financial institutions are asking consumers to use direct deposit services, ATMs, smartphones, and computer Internet connections in order to conduct retail consumer banking services.
Many banks have begun to charge for face-to-face teller services and even for telephone access to a teller. Consumers without Internet access or who are not capable of accessing accounts online will be expected, in the future, to pay more and more for these types of personal services that banking clients have always, up to now, enjoyed. Banking may become more impersonal, and fewer banks will offer walk-up or drive-up retail services for free, if at all.
Commercial Banks
A commercial bank is a for-profit financial institution that generates revenue by holding deposits from and making loans to customers, offering various financial services to consumers and earning interest on investments made (usually securities) on deposits. A commercial bank’s customers can enjoy the same services as that of a retail bank, such as savings and checking accounts, certificates of deposits, loans and mortgages, and credit, debit, and prepaid cards.
The main difference, however, is that a commercial bank typically will focus on commercial clients and short-term loans, or lines of credit, for businesses. A commercial bank could be a single, local bank, a branch of a national or state bank, or a credit union, and offers careers that are similar to those at any other bank.
Commercial banks, unlike investment banks, typically loan money to customers using only their own pool of funds and investment income, rather than drawing on outside funds in packaging loans.
Prior to the Great Depression, commercial banks were also investment banks. After the banking collapse in 1929, the U.S. government required banks to limit operations to one of two types of banking: either investment banking (which deals in commercial capital markets) or commercial banking (which offers consumer-direct banking services, such as checking and savings; debit and credit and deposits relating to these accounts; loans and mortgages; and other consumer services).
Until the Gramm-Leach-Bliley (GLB) act of 1999, also known as the Financial Modernization Act, commercial banks were prohibited from also selling any insurance services. After the GLB act, commercial banks were able to expand consumer financial services greatly to consumers by also becoming insurance agencies, becoming more and more of the “mass-market” strategic provider of “one-stop shopping” and being able to offer almost all manner of financial services, financial and retirement planning, and saving for consumers.
Today the differences between credit union firms and retail, commercial, and savings and loan banks are a bit blurry to a consumer, particularly after the savings and loan collapse in the late 1980s and the financial collapse in 2008, and also because they all seem to offer the same services.
The differences lie in the regulatory oversight of the different types of banks, thrifts, and credit unions; the respective insuring entities that make a depositor’s accounts safe from loss; the myriad behind-the-scenes financial money markets and clearinghouses; and congressional actions making up the many banking laws and regulations.
A smart consumer is wise to do his or her research, shop around for the best price and access for services, and make sure that he or she is comfortable that the financial firm of choice is capable, insured, and willing to provide the services needed.
Those seeking banking careers may find many opportunities for careers and advancement in a commercial bank.
Online Banks
An online bank can be a division or department of any retail, commercial, or investment bank, or it might be a bank that operates entirely online, with no physical location for a customer to walk-up or drive-up to, but that may serve all needs of banking customers. Online banks offer many banking jobs within their firms that are similar to banking careers at local and commercial banks and credit unions. Online banking is referred to as “E-banking” or electronic banking.
Online banks allow a customer to perform almost all banking transactions online, such as checking and savings transactions, bill paying services, account inquiries, and transfers. The customer of an online banking service can access his or her account at any time of the day or night with the use of a computer and a customer or user ID number and a password. Services can also include loan applications and payments as well as credit, debit, and smart card transactions. Careers with an online bank can include loan officers, credit analysts, as well as banking career positions in fraud analysis, investment, and management.
Customers’ online account balances can be real-time transactions that update the customer’s account immediately as the transaction is performed, or the bank can impose a time delay, offering the bank time to hold deposits or transactions until such time as the requested transaction has passed some type of quality control, typically a software program that analyzes the data to ensure correctness. Some online banks have very sophisticated software that even allows customers to deposit checks with an upload of a picture of the check taken by the customer with a smartphone.
Banks with online services have invested many millions of dollars of secure technology software and oversight in their computer servers and networks to ensure the accounts of depositors against any fraud or illegal access. Commercial businesses have embraced online banking, because ready access to the bank has simplified many aspects of business today, including payroll services, lines of credit, short-term loans, and bill paying services.
Those working in banking careers in a company’s business office can deposit or transfer funds, pay bills, accept payment from creditors and pay vendors, as well as deposit payroll funds to the employees’ bank accounts without ever leaving the office. Nevertheless, many people fear online banking and prefer to handle banking transactions at the physical location of a bank.
Another disadvantage of a purely online bank is the requirement that deposited or cashed funds must either be mailed by check to the bank or transferred directly from another bank. This is due to the fact that the customer cannot present the check at a location and handle the transaction personally, because the online bank has no physical location for customers.
Still, online banking is a vital function of all banks today. All banks are connected electronically to each other, either directly or through a clearinghouse, and all bank records are kept electronically. Electronic access is much more cost-effective than staffing a bank with people and tellers, and this transformation will only continue as young people embrace technology and reject face-to-face communication.
Fields within the Banking Industry
All financial firms in the banking industry, as well as the various banking regulatory agencies and associations, offer many paths for the person interested in a banking career. Most senior-level positions will require at a minimum a four-year college degree in finance, business, accounting, or a related field, but many entry-level positions can be obtained with a high school diploma or a GED. In addition, many larger banks and some of the regulatory agencies offer to intern or trainee positions and many also offer continuing education for the ambitious employee, including college scholarships and student loans.
Typical careers within a financial institution may include bank teller, bank manager, credit, mortgage, or loan officer, and a bank officer. Within each of those careers, depending on the size of the bank and the size of the department, are many levels of authority and responsibility and, therefore, many opportunities for advancement. Positions available within the regulatory industry include bank examiner, compliance examiner or officer, financial and/or compliance analyst, and economist.
Again, within each of these areas are many levels of authority, duties, and support. It is not uncommon for talented and experienced banking professionals to be recruited for more senior-level positions both within their own banks and by other competing banks. While it may seem that as the financial world becomes more dependent on computers and automation, and therefore may require fewer employees, the fact is that banks are growing all over the world and are competing against each other constantly for business and customers.
This means that banks will continue to search for applicants for the many careers available in the field. Skilled banking professionals, in any of the types of banks within the industry, should always be able to secure lucrative positions with a financial firm because of both population and economic growth.
Bank Teller
Bank teller positions can be found in all banking and credit union retail locations, both brick-and-mortar venues as well as online and virtual stores. Bank teller is usually the entry-level position for someone starting within the industry. The bank teller at a retail bank or credit union will be the person that a customer physically visits when cashing or depositing a check, purchasing a cashier’s check or money order, or any other cash service handled at a retail bank or drive-up bank location.
Bank tellers can also be found at banking call centers where customers may telephone a bank for any number of retail banking services. Call centers routinely handle requests for bank account services that may include funds transactions and reconciliations as well as retail services regarding bank products.
Bank and credit union call centers may offer products such as loans and various types of insurance policies as well as retirement and savings account products (money market accounts, certificates of deposit, individual retirement accounts, health savings accounts, treasury bonds) along with details regarding contributions, disbursements, and reconciliations for these accounts.
Starting salaries for bank tellers can range from $12,000 to $30,000 annually, depending on the geographic location of the position, the experience of the applicant, and the amount of responsibility for the position. To qualify for a bank teller position at a credit union or bank, the applicant must have a high school diploma or a GED and also must be bondable.
If the applicant has been convicted of any crime involving dishonesty or breach of trust, he or she cannot be bonded. Those considering banking jobs should be aware that federal banking regulations bar all banks from offering a position to anyone with this type of criminal record.
The bank teller applicant will generally need at least six months of customer service experience and six months of cash handling experience. It is imperative that a bank teller is dependable, punctual, friendly, honest, trustworthy, and efficient, as well as having a positive attitude. An affinity for numbers and a good grasp of mathematics will help a bank teller be successful, but being able to personally help customers with a friendly demeanor will be the key to real success as a bank teller.
The teller exchanges cash, personal checks, and products with the customer and will need to be able to communicate successfully and tactfully with people of all socio-economic positions while carefully accomplishing the transaction for the customer. Most bank tellers will be given sales goals and must be able to sell enough products to meet those goals while also handling the customers’ requests and correctly reconciling all transactions.
An efficient, friendly, trustworthy teller who instills confidence in his/her customers by offering pleasant and correct service will be able to both accurately service the customers’ banking needs and sell products easily. The bank teller who is shown to be competent in all duties will likely be promoted into a more specialized customer service position, such as a loan officer or bank manager.
Most banks and credit unions have basic requirements for these positions. Most banks and credit unions will require the new bank teller to attend one to three weeks of bank teller “school” where the new employee will learn the duties, responsibilities, processes, and procedures of the position as well as the expectations of the new teller.
Once placed into the banking career position, the new teller will be assigned to a mentor who will teach and assist the new employee until he or she is competent in all responsibilities and transactions. The mentor will help the new teller become comfortable not only with the bank’s processes but also guide the teller in learning to understand what is expected of a teller at their bank, and how to find additional assistance for more difficult transactions.
A bank teller who is successful at mentoring many new tellers is also likely to be promoted into a position of management or supervision in one of the bank’s many departments. Bank teller supervision and management positions in retail credit unions, banks and call centers can pay anywhere from $30,000 to $60,000, again depending on experience, skills, qualifications, and the bank’s location.
Loan Officer
A loan officer is a person at a bank, a credit union, a savings and loan, or other financial institution, who helps people and companies borrow money. Loan officers usually specialize in one of three types of loans: commercial (working with small or large business needs), a consumer (for individuals needing money for vehicles or lines of credit or other relatively small loans), and mortgage (home purchases and home equity loans).
The requirements for loan officer jobs range from a high school diploma (required by smaller institutions) to a college degree (in business, finance or a related field) for positions in many larger commercial finance companies. It is helpful to have sales or banking experience for the applicant for this position, and the applicant must be able to pass a thorough background check for employment.
Many financial institutions also require drug testing for all banking careers, both when being initially employed but also at random times later. A loan officer needs to be a confident person with excellent communication skills and must be detailed oriented. Many loan officers are paid on commission; therefore, a good work ethic and lots of motivation will be the key to success in this field.
Most loan officers are paid on commissions earned from the loans they place, but some institutions will pay a base salary plus commissions or some sort of bonus arrangement related to the number and dollar amount of sold loans. For this reason, average salaries for banking careers related to loan officers can range greatly, depending on the success of the loan officer, and the size of the loans.
Loan officers at smaller local banks can make between $30,000 and $60,000, but successful loan officers in larger banks or financial companies can earn upwards of $80,000 or more in good economic times. Commissioned loan officers, by definition, can earn much more than salaried loan officers, but the commissioned person will probably work longer days and will spend more time outside of his or her office, contacting customers and finalizing sales.
Periods of economic stability and low-interest rates produce a buyer’s market in real estate, which will, in turn, generate more loans, thereby producing higher salaries.
Loans are arranged for many purposes. Individual customers of a bank will need loans for homes; vehicles such as autos, motorcycles, or boats; home remodeling or repairs; and debt restructuring, for example, to pay off higher interest credit card balances.
Small business owners need loans for costs to start the business, such as rent deposits, hiring costs, advertising, to purchase equipment and inventory, or to maintain cash flow for salaries, stock, and other costs. Larger companies borrow money for the same reasons as small businesses but on a larger scale. Some commercial loans are arranged by the loan officer by using a number of banks and bundling a package of loans together for the customer.
A loan officer can be thought of as both a salesperson and a facilitator. The loan officer must both search for clients as well as help the client qualify for the loan needed once the customer has requested the loan.
To begin the process of a loan, the loan officer will gather basic information about the client and the type and amount of loan needed. Next, the loan officer will analyze the client’s needs, collateral, and credit worthiness against the amount of money and type of loan that the bank determines will be a valid risk for the bank to extend to the customer.
Today, much of this “analysis” is done with sophisticated computer underwriting programs that have already been built by the bank to facilitate the process for both the bank and the customer. The Internet has also drastically changed the loan officer environment as a banking career. A person searching for a loan can apply on any number of online banking sites through one portal, which will then match the prospect with a lender with the best interest rates for the product that the consumer needs.
However, the loan officer is responsible for overseeing the details of the transaction and making sure that the bank’s interests are maintained while making sure that the customer is treated fairly and legally. Many loan officers are instrumental in assisting clients who may have difficulty qualifying for loans by advising them on how to clear their credit, or by adjusting the size or amount of the loan.
Loan officers are sometimes promoted into two other types of positions in this banking field after a period of time as one of the three specializations above. A loan underwriter specializes in determining the client borrower’s creditworthiness along with the risk involved in making the loan, typically large commercial loans.
Loan collection officers work with delinquent borrowers to either restructure the loans or, in the case of default of the loan, the process of seizing the collateral property and selling it to try to pay off the debt to the bank.
Bank/Branch Manager
While banking careers in very senior upper-level officer positions are scarce and difficult to obtain, banks employ many mid-level managers to oversee all the banks’ different operations, departments and branches. Most bank and branch managers are bank officers.
To be an officer of a bank, most firms require the manager to have a four-year college degree in accounting, finance, business administration, or economics or to have completed a bank management training program where the trainee will work variously in many different bank departments in order to learn and experience the different aspects of the employing bank.
A bank manager manages all activities of a bank or a particular department of the bank. A manager of a department of a large bank may have more specialized duties overseeing the business, service, or profitability of the department. A bank manager typically starts off as a trainee, then progresses to assistant manager, and then, if successful, may be promoted to manager.
The bank manager is responsible for hiring, training, supervising and if necessary, firing the staff that he or she supervises. In smaller banks, the bank manager may also be the person who solicits business from the community, either by advertising their services or by visiting with local companies and their owners. He or she may also be the loan officer as well as the credit analyst.
Branch managers supervise all business and staff in a retail location of a national or international parent bank. A branch manager in a small local bank, while being responsible for all of the bank’s business, may also handle many additional duties from time to time, such as loan or trust officer, teller, or even some administrative duties.
A branch manager is both an administrator and a salesperson for the bank. He or she has the full responsibility for the branch’s activities and functions and must make certain that the branch and the staff comply with all banking regulations as well as the bank’s requirements and procedures. It’s the branch manager’s job to make sure that the branch or department is staffed appropriately and that the staff employees have the tools with which to carry out their duties and service the customers.
The branch manager must also work to make the bank or department a pleasant place for both the staff to work and the clients to visit. The branch manager must make certain that the bank services the customers accurately, responsibly and pleasantly, and that the branch’s financial goals are met.
In larger banks, the branch or bank manager may simply be the department’s head, directing the division’s many assistants, trainees or other staff and their activities with little customer contact. In all cases, the manager is ultimately responsible for maintaining and increasing the number of deposits and loans and working to ensure the profitability of the branch or the department and the parent bank.
Other types of bank managers can be operations managers, financial managers, and investment managers. Operations managers supervise other staff in banking careers in departments who handle the physical aspects of banking business, such as mailrooms, printing departments, computers, and networking staff.
Today, with virtual banking and online and telephone banking, many banks operate call centers with telephone tellers and loan officers, supervised by operations managers and bank officers. Financial managers analyze various types of financial statements, working in banks as well as in the investment and financial firms. Investment managers in banks oversee the investment portfolios of either the bank or the bank’s investors.
Bank manager salaries vary greatly, depending on the size of the bank or branch, and the type of bank. Entry-level bank managers’ median salaries vary from $35,000 to $50,000 but a senior bank manager or branch officer can earn from $50,000 to $100,000.
Most banks offer excellent benefit packages for managers, and it is not uncommon for a well-performing bank manager to receive significant bonuses depending on the business growth and profitability of both the bank and the branch or department. Many banks also pay for continuing education and advanced degrees for managers and officers, both to encourage skill development and to assist those managers who wish to gain financial knowledge in their career development.
Credit Analyst
A credit analyst studies the financial details of a person, a group of persons, or a company, in order to evaluate the bank loan applicant’s creditworthiness, or ability to repay the loan. Credit analysts can be employed by banks, credit unions, credit card companies, financial investment firms, or credit rating agencies.
Generally, most large financial institutions require a bachelor’s degree in finance, business, accounting, or a related field, but many banks will offer on-the-job training in credit analysis for talented employees without such degrees for banking careers such as this.
Typical pay for salaried credit analysts ranges from $35,000 to $60,000, depending on the geographic area of the employer bank and also the experience of the analyst. A master’s degree in business administration or a CFA (Chartered Financial Analyst) designation can be requirements for some upper-level positions.
While credit analysts are not normally required to obtain MBAs or CFA designations, many are able to gain higher salaries and be promoted to more senior analyst positions with these degrees, especially if they are employed by larger corporations with greater assets than smaller local or regional banks.
To be a successful credit analyst, excellent detail-related skills and diligence with numbers are crucial. The credit analyst gathers various financial data about the borrowing customers and will then evaluate the information.
Next, the credit analyst writes recommendations regarding the risk assessment and creditworthiness of the applicant, company, or group of applicants. A credit analyst might analyze borrowing and payment data from many sources to assess the creditworthiness of a line of products, such as mortgages or credit cards, or the analyst might study the financial and cash flow history of one client or one company in order to underwrite a particular loan to a customer.
Credit analysts who specialize in a particular industry might work in the financial sector or might work directly for a company in that specific industry, such as a utility or a manufacturing company. In these positions, the credit analyst should have experience and knowledge about the financial history, statistics, and trends of the employing industry, and will work in analyzing the risk assessments and creditworthiness of the company’s clients or of the company’s money or banking needs.
Credit analysts are not salespeople. They are number crunchers and money analysts. Skills needed for a credit analyst position are problem-solving skills and diligence with numbers, along with a talent for reviewing and explaining the bigger picture of all the smaller numeric details.
A good credit analyst also needs to stay knowledgeable about the trends and business structure of the market to be able to successfully gauge the current position of the borrower’s risk assessment. Obviously, since modern banking uses sophisticated quantitative software programs, credit analysis software knowledge is critical.
The credit analyst must understand both the results of the reports as well as the underlying data management details in order to comprehend the evaluation. Good communication skills, both written and verbal, will help the credit analyst to successfully communicate his or her results from the analysis.
The credit analyst has an enormous responsibility to accurately assess the risk of the products or the applicants’ creditworthiness. Incorrect analysis of data or errors in accounting can result in great losses for the credit analyst’s bank. In order to be successful, great attention to detail and a solid understanding of the areas of accounting, calculus, debt service, and ratio analysis are important for professionals interested in these positions.
Software programs are constantly being developed to analyze data and produce statements, but the credit analyst will always be needed to review the information and the data and to effectively communicate the risk assessment. The credit analyst must have the education and experience to be able to use these complex tools and must also have the skills to explain and justify the financial statements produced by the research for the final risk assessment determination.
Mortgage Banker
A mortgage banker (also known as a mortgage broker) works for the client borrower as a type of “middle man” between the lender (owner of the loan) and the purchaser (the borrower). A mortgage broker does not work for a bank but rather works with any number of banks whose loans the broker will sell for the bank. This type of position is unique in the banking industry, because the mortgage banker or broker usually works for a loan company or agency, and is paid on the basis of the loans placed.
Mortgage brokers in all states must be licensed. Each state will have its own regulations and licenses, but typically, the mortgage broker is liable for any type of wrongdoing or fraud that he or she may have been involved in, for the life of the loan. Mortgage brokers may refer to themselves as “loan officers” but they are not actually officers of any bank.
A mortgage broker is usually paid by commissions on the loans that he or she sells. Typically, a mortgage broker is able to make more total earnings than a bank’s loan officer, but the commissions will depend on the amount and number of the loans that are sold by the broker. A mortgage broker can earn anywhere between $40,000 to $120,000, on average, depending on the geographic location of the position and the number of loans that the broker is able to sell.
A mortgage broker advertises or markets for customers to purchase mortgage loans from the broker. The mortgage broker will then meet with the prospective client to gather information about the needed funds and the client’s information and financial history. This is usually referred to as the fact-finding interview, and the client will complete a preliminary application for the loan.
The mortgage broker will obtain a credit report on the applicant and review the borrower’s situation in order to correctly find a loan product that is affordable and that will meet the needs of the client. This is called the pre-approval period, where the lender agrees to conditionally “approve” the client for a loan.
The next step is sometimes performed by an assistant to the mortgage broker. This step in the process is obtaining all the documents from the client that will qualify the borrower for the loan, including paystubs, bank statements, credit card, and bank account numbers, proof of identification, details, and address for the collateral for the loan, and any other items that are needed to prove sufficient cash flow to be able to pay the monthly loan installments.
If an applicant is self-employed, tax returns, Schedule K-1 statements, and a year’s worth of bank account statements may need to be obtained to show the requisite salary. The actual application for the loan will be completed at this time, by either the broker or the broker’s assistant. The mortgage broker should explain the entire process and all the legal responsibilities of both the lender and the borrower to the borrower.
The broker will complete the lender’s application to the lender and will submit all applications and documents to the lender for approval.
Almost 2/3 of all mortgage loans originating in the U.S. are completed through a mortgage broker channel, with slightly less than 1/3 of the loans done through a bank or credit union’s retail market, or direct to the customer.
Online brokerages today have simplified a great deal of the loan process by using software that condenses many of the preliminary steps made by the borrower and then narrows the vast field of available loans down to only those loans that the borrower is qualified to purchase. The online software “brokerages” also give the prospective borrower an opportunity to “shop around” and compare the different interest rates in the marketplace.
Mortgage brokers buy packages of loans, usually at a discount, from a variety of sources, such as banks and other lenders, and sell each loan to customers for a commission. While a mortgage broker will work with loan clients in the same way that a mortgage loan officer finds loans for customers, the difference is that the mortgage broker usually works for a mortgage brokerage rather than a bank, and will find loans from many different banks or sources.
A loan officer will be limited only to selling the loans offered by his or her bank and must adhere to the credit requirements of the bank’s regulators. Often, a mortgage broker is able to loan money to high-risk borrowers when banks are not able to offer these customers a loan because the loans’ cumulative “risk” is spread out among the broker’s entire loan package.
Prior to the 1970s, most loans were made by banks that had reserved access to wholesale money markets for mortgages. With today’s regulatory atmosphere, all mortgage brokers can access loans from both of the secondary wholesale market lenders in the U.S., the Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (Freddie Mac). This has caused a shift in the number of loans made by mortgage brokers from very few in the 1960s to over 65% of loans sold in the U.S. today.
Office Staff
Banking institutions employ any number of office and support staff for all office departments, similar to any large or small firm. Office departments in a banking firm can include human resources, building, and janitorial operations, payroll, administrative and secretarial support, data entry on up to computer technology, programming and application development, support and maintenance.
Each department, depending on the size of the firm, will have multiple levels of authority and responsibility for all banking careers of this sort. Bank jobs within these departments can range from entry-level and intern, to support and middle management, on up to the department’s director or chief officer.
Many positions, both senior and otherwise, in a banking firm are supported by any number of staff that can be considered secretarial, administrative, clerical, or assistant. These careers can be entry-level positions, pay minimum wage, or might be senior positions, such as a legal clerk or research fellow assistant, with pay ranging from $50,000 to over $100,000, depending on education and experience.
Human Resources, Personnel and Payroll departments in banking firms operate very much the same as these departments do in many other types of firms. These employees need to be familiar with both state and federal employment laws as well as banking regulations regarding staff performance.
Certain regulatory bodies have oversight regarding pay for some bank employees. Staff in these departments must be knowledgeable of these limits and make certain that the bank or entity follows all the regulatory guidelines surrounding pay. Senior Human Resource staff at a national bank can earn well over $100,000, particularly if they hold a Society for Human Resource Management certification, either SPHR or HRM.
Many Directors of Human Resources at large banking institutions are also licensed attorneys since much of what this department must oversee is guided by legal decisions. Larger firms will also employ assistant Human Resources, Personnel, and Payroll staff, starting with unpaid interns or apprentices to entry-level staff and assistants. Ranges of pay vary greatly, depending on the size of the bank, the location of the Human Resources department and the number of banking careers staff needed.
Computer and software technology staff are crucial to the operation and success of a large national or commercial bank or credit union. Automated teller machines, online banking, and online support have greatly increased customer access for many banks.
However, along with this online access, are increased security breaches, and many more fraudulent events that must be tracked, researched and contained.
Many technology positions are held by experienced software engineers who have learned the trade building the large banking platforms used by banks to support customer service and also banking records. Technology platforms in banking include those used in the lending industry, the legal divisions, and very importantly, in compliance monitoring.
Compliance monitoring software searches words and lexicons used in communications and records to prevent infractions of the law. Computer and software experts in these fields can be highly paid if they are the ones developing and troubleshooting software programs, often earning well in excess of $150,000.
However, because of the complexity of the codes used by the banks’ software programs, and the sheer size of the data, all banks employ many computer technology people in a myriad of positions, ranging from data entry to programmer analysts who help to monitor small errors in software that can appear daily. Salaries for these banking careers can range from $8 per hour for data entry to $40,000 to $80,000 for programmer analysts.
Any banking firm that houses staff or equipment in a building must employ janitorial, maintenance, and facilities staff, ranging from cleaning staff to building maintenance staff, to air conditioning and plumbing staff, to staff that pays the utility bills. These positions are not unique to the banking industry and may employ people with experience with facilities from all industries.
However, it should be noted that banking facilities staff receive salaries and benefits on par with other industries, and do not typically receive any increased benefits or perks for working in the banking industry.
Small banking firms generally offer lower salaries for similar positions than larger, national firms, but typically enjoy stability and possibly even less stress than large banking institutions. This can be seen as due to the lower amount of transactions and customers generally seen in a small or local firm.
Degrees Needed for Banking Careers
Professionals seeking careers in banking will require, at a minimum, a high school diploma or at least a GED. Without a higher education degree, many positions and advancement opportunities will not be open, even if the prospective employee is talented and experienced. Money, and the business of holding, lending, and increasing it for customers, involves intensely detailed, important tasks that require trust and dependability as well as innovative but stable practices that are safe, sound and fair.
Employees of a bank must be disciplined, organized and trustworthy, as well as keen with details and thrifty with clients’ money, since customers want to know that their money is safely and carefully handled.
A college education not only teaches a student a subject, it also teaches organization and discipline and how to complete difficult tasks, which are critical skills in a banking career. If you sincerely wish to pursue a career path in the banking industry, start with a high school diploma.
Next, work toward either an associate’s degree or a four-year bachelor’s degree in finance, business, accounting, or any related field. Seeking out internships or trainee positions with either a local or a national bank or a credit union may also be helpful for applicants seeking banking careers.
Associate’s Degree
A person looking for a banking career would be well advised to work toward obtaining an associate’s degree with an emphasis on subjects related to the banking industry, such as accounting, statistics, business, or any other related fields. The completion of any degree program in banking will aid a person in seeking promotions, greater pay, and higher responsibility and authority.
An Associate of Arts or an Associate of Science in many banking fields such as banking, finance, business, and accounting can be obtained usually at a two-year community college and from certain trade, vocational or occupational schools that offer a degree program.
Generally, a high school diploma or a GED is required for enrollment, and sometimes, a minimum grade point average of at least a 2.0 or C is required for certain degrees.
A significant advantage of obtaining an associate’s degree at a community college is that the cost for the degree is usually much less than at a trade school or even at a four-year institution, as most communities are able to subsidize the tuition for local students. A student attending classes on a fulltime basis should be able to obtain the associate’s degree in two years’ time.
Fulltime is usually a minimum of 12 to 15 credits per semester, or four to five different course classes during each semester period. The first year of courses will be made up of general classes, such as math, science, English, and other basics, and the second year will focus more on courses and skills toward the banking degree.
Students may apply for financial aid – scholarships, loans or grants to help pay for educational expenses. Qualifications for financial aid depend on the income situation of the student, and sometimes, the parents of the student. Some expenses may also be tax deductible under many federal IRS tax credit rules. If the student is already employed by a banking or regulatory institution, tuition assistance and even reimbursement may be available from the employer.
Many associate’s degrees can also be obtained from various community colleges, universities and occupational schools by utilizing special learning situations such as online courses and studies, or weekend and evening class schedules. Some universities today are completely set up as virtual classrooms, with online studying and no attendance at classes outside of one’s home or office.
Bachelor’s Degree
A bachelor’s degree is invaluable for someone interested in a career in banking, particularly if the person is ambitious, likes challenges, and seeks a meaningful and stable career. Without a bachelor’s degree, many managerial positions, and virtually all senior-level positions will not be available, no matter how talented and skilled the employees may be.
Furthermore, the knowledge and education that the professional will receive with one of these types of degrees will enhance the job performance of the banking employee.
In order to apply or enroll in a bachelor’s degree program at either a four-year university or college, one must have, at a minimum, a high school diploma or a GED. Most banking programs at prestigious universities, such as Boston University, may require a minimum high school grade point average. Other schools or universities may not have such stringent prerequisites and the requirements may change from year to year, depending on the learning institution’s current enrollment.
To assist you in obtaining a banking careers job or promotion, choose a Bachelor of Science degree in business, accounting, finance or economics, or computer science or computer engineering, depending on the chosen banking field, and pick a university or college that specializes in banking careers and degrees.
To obtain a bachelor’s degree, a student will need to complete four-years with two semesters (or three quarters) per year of a full-time course load. Semester system schools operate with two semesters per year, of about 12 to 14 weeks per semester, fall and spring, to complete a full year. A minimum of nine to 12 credits during the semester qualifies as fulltime student status.
Quarter system colleges, with fall, winter, and spring quarters lasting about eight to nine weeks each, making up a full year, calculate 12 to 15 credits to be considered fulltime. Both systems usually offer condensed courses during the summertime that usually consist of two to six weeks per course, depending on the credit hours offered. A semester hour typically is calculated to about one-and-a-half quarter hours.
During the four years of study to obtain a bachelor’s degree, most universities will require about two years of basic and required courses, usually at the freshman and sophomore year level, consisting of various courses such as English, Mathematics, Science, Social Science, and History. Many options in each subject are usually available in order to fulfill the basic requirements, and the degree chosen by the student will most likely guide the student towards certain basic courses that may be prerequisites for required courses in the chosen major field.
In addition, most colleges require a number of elective courses to round out the student’s education. Courses for electives can be chosen from any number of fields such as languages, communication, political science, physical education, music, and so on, the variety of which will depend on the chosen institution of higher learning, and its offerings.
A junior or senior level student in a Bachelor of Science degree program will take courses focused on the field major, such as accounting, finance, or business. These courses are referred to as upper-level courses. Courses in the degree field will build upon the subject of the major and also other related subjects. Sample courses for a degree in accounting and finance will include many courses in mathematics, statistics, and so on.
A degree in economics and business will most likely require at least one or two courses in mathematics and statistics, for example, but may also include courses in the history and the study of economics and business in the United States, and possibly Europe, depending on the course.
Many universities and colleges today offer the student innovative options in order to obtain a four- year bachelor’s degree. Online classes have replaced many classroom locations. With the aid of a computer and a video conferencing system, the professor can be miles away, the students scattered across the country, and lectures, as well as conversations, can be held in a virtual classroom.
In addition, many schools offer online, computer-based courses and tests where the student can manage his or her own study time, which is particularly useful for students who work fulltime jobs and who are enrolled in courses part-time.
Many banks and most banking regulatory bodies offer internships, summer temporary positions, and trainee programs for college students enrolled in or graduated from universities that focus on degrees for the banking industry. Serious students, interested in banking careers or promotions within the field, can find many of these opportunities either at the universities’ placement department or online on the institutions’ websites.
Master’s Degrees
A master’s degree in a banking field, such as finance, accounting, business, economics, or computer technology and science can succeed in catapulting professionals in banking careers in mid-level position to more senior positions, gaining those professionals increased pay and bonuses, along with higher authority, more responsibility, and greater career success.
A prerequisite to obtaining a master’s degree in almost any field is an undergraduate degree, either a bachelor of science or a bachelor of arts. Bachelor of Science degrees are awarded in the fields of the hard and soft sciences, such as mathematics, accounting, biology, finance, political and social science, anthropology, nursing, and so forth.
Bachelor of Arts degrees is awarded to students who studied in the fields of art, music, languages, history, literature, and so on. In addition, most colleges and universities require the master’s degree applicant to pass the Graduate Record Exam (GRE), an elective test to gauge the student’s capability, knowledge, and communication skills prior to being accepted into the master’s degree program.
Almost any degree that is offered as an undergraduate degree in the banking field can be found also as a master’s degree offering. Master’s degrees are offered at many universities in the fields of accounting, finance, financial planning, economics, computer science, and technology, to name a few. Courses are referred to as graduate-level courses.
A master’s degree program will consist of class courses in the required field, and the course of study is usually directed by not only the university but also the college, or department, head of the field. Graduate-level courses will increase in difficulty and complexity within the subject, and in most cases, will consist of large amounts of research and study reports.
A master’s degree student should expect at least two years, and frequently three years, of study. A master’s degree student may also complete a certain amount of internship experience in the field, depending on the degree program, at companies, banks, or firms that may offer this type of experience. Course credit is often given for internships, particularly if they are offered as part of the program and a professor supervises the student’s experience in various banking careers.
Many professionals in banking careers seek out master’s degree programs that are offered either evenings or weekends so that they can continue with their daytime work while studying toward an advanced degree. In addition, the advent of computers, video conferencing, and the Internet, virtual classrooms that meet online, as well as course study and research that can be accomplished at any hour of the day, have made a master’s degree attainable for many professional and ambitions employees.
Most banks and banking regulatory institutions offer either reimbursement or pay for advanced degrees and continuing education for many of their employees. Typically, to qualify for the tuition assistance, the employee must be in good standing with the employer and must pass the course and/or the graduate program successfully.
Often, once the student has obtained a graduate degree, the employer may either promote the professional on the basis of the degree or frequently increase the responsibility and pay of the employee, due specifically to the achievement.
Continuing Education in Banking Careers
Banking professionals can greatly enhance not only their knowledge of banking but also their potential advancement by taking advantage of the many banking certifications and continuing education programs offered by banking and financial or insurance associations, universities, colleges, and trade schools. Continuing education is invaluable to the banking professional, whether he or she is a frontline teller employee, a middle manager, or a senior executive.
The most prestigious and highly regarded continuing education in the banking industry is offered by the American Bankers Association (ABA). Courses offered by the ABA include subjects such as commercial lending, compliance, bank marketing and management, risk management, and trust courses.
The ABA schools also offer courses to prepare the banking professional for various certifications in Retail, Bank, Compliance or Risk Management, as well as certifications in Mortgage and Commercial Lending, Retirement Services and Wealth Management and Trust. The ABA offers no less than 16 different certification courses of education.
The ABA also sponsors short, one to two week continuing education events throughout the year, usually held at various locations around the country that offer up to the minute education and information about trends, skills, tools, and changes in the banking marketplace and industry. Members of ABA are usually offered a significant tuition discount and many banks will pay for staff attendance.
Many investment and insurance financial professionals are required to obtain and maintain licenses for their profession, and the industry offers many resources to these banking professionals to be able to comply with either state or federal continuing education requirements for their licenses.
The Investment Banking Institute (IBI) (www.ibtraining.com) offers excellent continuing education courses both for the current financial professional as well as courses to help the person who wishes to join the profession but needs to complete the required courses for licensing. IBI offers continuing education courses in investment banking, private equity, hedge funds, equity research, asset management, private wealth management, and corporate finance and strategy.
IBI also offers training to the prospective financial services professional in the areas of resume and interviewing skills as well as valuation and financial modeling training in their investment banking courses.
Securities professionals are required to obtain certain federal securities licenses, such as Series 6, Series 7, and Series 67, depending on the type of securities transactions that the professional will handle. To obtain these licenses, many professionals prepare by taking various education courses offered either by the investment firm or trade schools, since the securities licenses are difficult to pass.
Insurance financial professionals must pass a licensing exam, after which they will receive a license from the resident state of the licensee. State license preparation courses are typically available in most major cities and help prepare the prospective insurance professional to pass the state license to sell and service insurance.
Once the insurance license is obtained, each state maintains continuing education requirements that must be obtained by the licensee before each renewal of the insurance license. Continuing education courses for insurance license holders are offered by many state insurance agent associations and organizations. Nahu.org and naifa.org both have links to state organizations that offer many required courses that meet these continuing education needs.
Schools Dedicated to Specific Banking Careers
The professional who wishes to enter the banking industry can choose from a number of schools dedicated to specific bank careers. Schools can range from bank teller school offered at many local community colleges to trade schools offering specific trade education, such as mortgage loan processing, to universities with bachelor’s and master’s degrees in finance, accounting, information technology, law, and other related subjects.
Courses to enhance bank careers or promotions within the field can be found through online or web based-universities and schools, or a student may prefer to attend classroom courses at a local college or university.
The banking and financial industry in the United States today is a multi-trillion dollar industry, employing millions of people in private and public firms as well as in the federal government, typically in regulatory agencies. Obviously, with so many people employed in this huge industry, many career opportunities are available, but competition for promotions can be fierce.
Experienced professionals who wish to move up in this industry and gain promotions to more senior levels, will need to obtain certifications, diplomas, or degrees in their chosen field in order to gain knowledge and status within the ranks of employed staff.
While many schools and colleges offer courses that may lead to banking degrees or certifications, it is important that the professional make certain that the degree or certificate offered is awarded by a learning institution or organization that is well respected in his or her field of banking, and that the learning institution is fully accredited.
Choosing a School
When choosing a school in pursuit of a banking career, one must first determine which designation, degree, or certificate is desired. The banking professional might want to discuss the subject with his or her banking supervisor, and determine which degrees or certifications for banking careers will be advantageous for the student in his or her current position, or for the promotion desired.
The student might also ask other banking professionals at his or her bank to recommend courses or schools that they have attended or that are known to be accredited and well-respected. Many banking firms will aid the professional student by reimbursing or paying tuition costs and arranging for time off to take courses if the student is a valued employee and passes all courses.
Each course offered at either a school, university, or association will have a course syllabus, or outline, of the details in the course to be taught. The student can request a summary of the syllabus, in order to determine whether the workings of the course will be the type of learning that the student needs.
If the student is interested in enrolling in a brick-and-mortar campus, the college or university will encourage the student to visit the campus and the specific banking department in order to receive a first-hand impression of the school and the department.
If the student has either professional or personal demands on his or her time, an online or web-based school or course may be easier for the student to commit his time to study. At the campus visit, or when discussing the online or web-based school with a campus representative, the student may wish to ask the representative questions about the course and the school, such as, what percentage of the students who enroll in the course complete the course and pass the required exams? What is the teacher-to-student ratio of the department?
If a student needs study help or has questions throughout the course period, what kind of course assistance is available, such as a professor with open office hours or a teacher’s aide with availability by phone or email? If the student does not pass the course, what additional help is available? And finally, the student who wishes to obtain financial aid should ask details regarding the requirements for loans and/or scholarships or grants available from the school or university.
Applying to School
To apply to a university, a college, or an organization that offers degree or certificate programs for careers in banking, it is advised that the student visit the school’s website and review the requirements for enrollment into the school.
Each learning institution will have its own set of requirements for application. These can include, but are not limited to, residence requirements, (community colleges typically require the student to be a county or city resident) prior schooling requirements (most colleges and universities require a high school diploma or GED prior to enrollment) or prior education grade point standards (some colleges accept only a small percentage of applicants, and typically limit enrollment to a set percentage of students with upper-grade point averages).
Many university courses of study aimed related to banking will require students to take the SAT exam and many higher institutes of learning to require a minimum test score for enrollment. Banking associations that offer certificate programs often require a letter of recommendation to the program from a senior banking official in order for the person to gain acceptance into the certificate program.
Often, the student will be asked to write a letter or essay stating his or her reasons for applying to the program, or an essay chronicling the applicant’s experience in the chosen field of study and why he or she wishes to obtain the degree or certificate. The student is advised to write positive but honest details about his or her work or life experience.
Remember that the student will be chosen from many applicants and the school will want students who will exemplify the mission and standing of the school or university in the community.
Applying to a university, college, or trade school usually starts with an online application, but some institutions will accept paper applications. The application will ask for many details about the student, including name, address, citizenship, and prior schooling. The application might also ask many essay-type questions, in order to gauge the student’s qualifications, abilities, and background.
A transcript showing the student’s prior education is always required, and the learning institute may even ask for recommendations from teachers, professors, or work supervisors. Most learning institutions will require an application fee to be included with the application. A student is well-advised to be aware of the application deadlines and also of the application requirements that will need to be submitted with the application. An application will not be accepted if all details are not submitted as required and if any details are submitted past the application deadline.
Banking School Accreditation
The Council for Higher Education Accreditation along with the United States Department of Education oversees the accreditation certificates and details of all higher distance education in the U.S. To ascertain that a school, university, or college offers a quality education, accreditation certification is required. Many schools and colleges are not accredited, and may or may not offer a quality education.
The U.S. Department of Education also today oversees accreditation for all online schools, in conjunction with the Distance Education and Training Council (DETC). The Association to Advance Collegiate Schools of Business (AACSB) provides accreditation services for schools in the fields of accounting and business at the bachelor’s, masters and doctorate levels.
Each accreditation organization will have different but stringent requirements that must be met by the learning institution in order for it to obtain and maintain accreditation. The accreditation standards serve as a measure of the quality of the education provided. Standards can include academic standards, research and governance standards, and even facilities and their quality. The institution for learning’s mission, philosophy of learning, and long-range or strategic plans can also be scrutinized for accreditation.
Unless the student is enrolling at a well-known university or institution, it is advised that the student verify the accreditation status of the institution, and most particularly of the courses related to banking related degrees. An educational institution that has fulfilled the requirements to be accredited by the responsible accrediting organization or council will have shown that they subscribe to a higher level of excellence in education. In addition, a degree or designation from an accredited organization is held in higher prestige than one from an unaccredited institution.
An accredited institution is not necessarily more expensive than a non-accredited school. Most community colleges are fully accredited but typically charge lower tuition rates than a university or a trade or professional school. The student is advised to do his or her homework regarding the status of the school prior to applying for any course of study related to banking careers.
Banking Careers Certification
In the banking industry, a great many certifications are offered to banking professionals, depending on what type of bank at which the professional is employed, and the sorts of banking careers held. These certifications can range include a CBT (Certified Bank Teller), a CFP (Certified Financial Planner), a ChFP (Chartered Financial Planner), a CFMP (Certified Financial Marketing Professional), or a CTFA (Certified Trust Financial Analyst).
Also, most positions in mortgage banking require licensing and continuing education. In all situations, a certification (and in some industries, a diploma) can do much to aid professionals in their bank careers. The certification will gain the person’s education and knowledge and will demonstrate to the employer that the bearer is a professional who is interested in maintaining the professionalism and profitability of the bank.
While it is true that professionals with bachelor’s degrees, and in many situations, master’s degrees, usually hold most senior bank positions, it is also true that only those professionals who have obtained the certifications designed for their particular banking careers gain many senior positions in financial firms.
Most retail bank officers and managers hold the CFMP or the CPB, offered by the American Bankers Association. Furthermore, many financial institutions, including the regulatory entities, offer tuition payment or reimbursement to those professionals who are seeking to enhance their employer firms’ knowledge and standing while also pursuing individual ambitions in various banking careers.
What is Certification?
Bank and financial certification courses are offered by a number of different schools, either affiliated with a state university, a trade school, or sponsored by financial associations. Many banking certifications are offered by the American Bankers Association, but certification courses can also be offered by universities such as Boston University and the University of Phoenix, one of the largest online universities in the United States.
Banking certification designations are valuable not only to the banking professional by enhancing his or her employment status in the banking industry but also can help to generate a higher salary. Many regulatory bodies require that certain certifications be held by senior management officers and directors of a banking entity, to ensure that the bank is being operated and managed competently, and therefore the deposits of the bank’s clients are being handled safely and securely.
To be promoted to management positions, many financial entities frequently require that the prospective manager hold a certification in the subject of the management department, for example, a supervisor for a department of tellers may need to hold the CBT or the Certified Bank Teller designation. The officer of an investment or wealth management bank will most likely hold a CTFA or a Certified Trust Financial Analyst designation. The manager or officer of a lending institution or mortgage-banking branch usually holds a CLBB or a Certified Lender Business Banker designation.
The banking career designation held will certify that the professional has taken the courses related to the banking profession and has passed the exams to award the designation, ensuring that this professional is at the top of his or her knowledge of the banking field.
To become certified, all courses in the certification course listing must be completed, and the student must obtain a passing grade in each of the final examinations for each course. In addition, most certifications will require continuing education, typically about 30 hours every two years, to maintain the certificate or designation.
Many banking certification courses can be enrolled in and pursued online or in evening classes, helping the professional who is working at a daytime banking position to obtain the certification. In addition, many financial entities, particularly the larger firms, are known to offer in-house training for skilled and ambitious employees who wish to pursue certifications in their own banking field.
A certification in a certain field can also help to propel the ambitious banking professional from a somewhat lowly position, such as a teller, into a position with more authority, more responsibility, and often, a promotion with the ensuing higher salary.
Types of Certification
Certifications offered by the American Bankers Association include retail certifications, such as the Certified Bank Teller (CBT) designation, the Certified Customer Service Representative, the Certified Financial Marketing Professional, and the Certified Personal Banker designation.
In Compliance and Risk Management, designations include the Certified Regulatory Compliance Manager, the Certified Financial Services Securities Operations Professional, and the Certified Information Security Professional. Mortgage lending professionals may seek out the Certified Lender Business Banker designation. Retirement Services and Wealth Management and Trusts professionals can obtain one of eight different designations, apart from any federal securities licenses, from the American Bankers Association.
The Bank Training Center, an online and web-based training school, devoted to certifications in various banking careers and continuing education, offers no less than 26 banking careers certification courses ranging from a Bank Teller Certificate to a Charter Financial Analyst. The Bank Training Center offers designations, certifications, and continuing education through online courses, webinars, audio conferencing, self-study materials, and banking seminars.
To obtain a banking certification, many of the certificates do have certain requirements. An example is CBT. To take the test and obtain the CBT, a bank teller must have worked a minimum of six months in the teller position, offer a letter of recommendation from a senior bank official, and must sign a professional code of ethics statement.
Most senior banking professionals hold either a four-year bachelor’s degree, a master’s degree in finance, accounting, management or a related field, or an MBA, a master’s of business administration. In addition, many senior or management certifications may be difficult to obtain without one of these university degrees, as the subjects in the certifications may be difficult for those who have less education. An example is the Certified Bank Auditor.
Without a solid education in accounting and statistics, this certification might be too difficult for someone who maybe just out of high school, or who has no experience in auditing specifics. Another example is the Certified Information Security Professional (CFSSP). Most information security is computer and software-based, so professionals seeking the CFSSP designation would need to already have the knowledge obtained in either a bachelor’s or master’s degree in computer science, along with the experience needed in this particular field in order to understand the complicated subject matter.
Preparing for Certification Tests
To prepare for a certification test, the student must have first completed the designation’s required courses. The course administrator, teacher, or facilitator will advise the students when and where to register for and complete the exam. Exams usually do have a cost that may or may not be separate from the study course materials.
Most tests require that the exam be held at an independent testing center, or at the student’s employer’s location, with the requirement that a senior banking official must supervise and certify the exam. Most exams are conducted online, are timed, and typically include multiple-choice questions. If the student does not pass the exam on the first try, he or she is usually allowed to retake the test at a later date for an additional fee.
A student would be well advised to register to take the certification test quite soon after completing the course classes and completing all course study materials. If the student waits too long after finishing the course, much detailed information may not be easily accessed or remembered during the exam.
Many students can benefit from attending study and discussion groups with other students of the courses. In addition, many courses offer practice tests and hints for specific details that will be examined in the test. If the student has systematically studied the course materials as instructed by the course outline, has completed all course materials, and clearly understands all the materials in the course, he or she should be well prepared to take and pass the certification test. Good study habits will result in a passing grade.
Finding Banking Careers
Many people searching for a banking career start out at the bottom, as a clerk or a teller, and strive to move up or be promoted into the next higher-paying position. Others begin their careers after graduating from college, and may even have had the opportunity of being an intern during their university studies. Others may have been recruited by a banking institution due to the degree obtained and the school or university where the student obtained the degree.
Still, other routes to bank careers include those in which the professional may have worked in a different but perhaps related fieldss, such as insurance or accounting, and later chose to move from that field into the banking industry.
In all cases, successful job applicants must have composed a resume that is detailed, honest but succinct, correct but impressive, and will also need to be able to present himself or herself admirably within a job interview. You can’t make a second first impression – that’s the key to getting a good job in the banking industry. The resume will need to focus on skills and experience related to specific banking careers.
Professional dress and appearance is crucial – if you look well-dressed and well-groomed, the employer may think you are a disciplined professional. If your resume is grammatically correct and well organized, the prospective employer may judge you to be a more competent candidate.
Many banking positions can be found online on both general job search engines, such as Monster.com and Jobs.com, as well as on the banking institutions’ websites themselves. Search for a company by entering the name on any search engine, such as Google.com, Bing.com or Ask.com, then accessing the company website. Most sites will have a page titled “careers” or “job opportunities” that will instruct the applicant on the method for applying to them for a position.
Many large banking firms and most banking regulatory entities will even list the open banking career positions with a link directly to the application. Good research and diligent time spent can result in many opportunities for interviews, and possibly, a new career in banking.
Resumes
A resume that is well organized, detailed but concise, honest, and that includes descriptive verbs and specific nouns will open many interview doors for the job applicant searching for positions within the financial industry.
Young applicants for banking careers, with few job experiences, or even a recent college graduate, should be able to craft a good resume that is limited to one page in length. A more senior job applicant, with more than ten years of experience or more than five different jobs, may wish to use more than one page of a resume in order to outline his or her talents, skills, and experience.
Nevertheless, a good rule for a proficient resume is a maximum of two pages in length. The only exception to this rule is used by university professors or esteemed professionals of a particular field, in which they are allowed more than two pages with which to chronicle their achievements and/or publications. This type of resume is called a “curriculum vitae”.
To prepare for a nicely organized resume, begin the outline by listing all job experiences by the title of position, name of the company, location (city and state), and the time frame of the position, for example, 2006 to present or 2004 to 2006. List the most recent or current position at the top, and the very first position ever held at the end of the list.
If many years of experience are to be listed, or many positions held over the years, most employers only want to review what has been accomplished in the past ten to 15 years. However, for this exercise, list all positions, and as many experiences as can be described. The finished resume will list the jobs held at the actual end of the resume or at the bottom of the page, but the task of simply listing all job experiences will help to spur the memory of the duties, the skills, and details learned while employed at each position.
For each position, write sentences detailing all job duties, accomplishments, and any specific tasks completed while employed. Use as many descriptive verbs and nouns as possible, using the computer’s software and thesaurus or synonym help functions. List any awards, commendations, etc. Detail anything that might have shown good working habits, or that describes an exemplary employee, trainee, or intern. Next list all strengths.
Any work as a volunteer and any accomplishments or accolades while unpaid but working at a charity or nonprofit organization, as well as any business, such as family-held businesses, should also be listed and detailed.
Now, list details about education and degrees held, again putting the most current achievement at the top of the list, ending with a high school diploma or GED details. Also list any continuing education certificates or degrees held, as well as any education that did not result in a degree.
To assemble the resume, beginning at the top, type the name of the owner of the resume, centered and in bold letters, in a font that is larger than the body of the resume. Just below the name, type the address in a smaller font than the name, but again in a font that is bigger than the resume’s body. Telephone numbers, cell, and home, should be listed below the name and address at the left margin of the page, notating which is the cell number and which is the home number.
At the right margin of the page, list a private email address. Never use a current work phone number or a current job email address on a resume. If a private email address is not owned, yahoo.com, hotmail.com, and gmail.com offer free private email addresses for anyone who requests one.
Now go back and re-read and review each of these descriptive sentences. Edit the sentences to be grammatically correct, verbally descriptive and appealing, and to be concise, succinct, but correct and true. Don’t be too wordy, and don’t use run-on sentences. Make each sentence refer to a different task or responsibility, and don’t duplicate experiences or restate the same skill.
Place these descriptive sentences within one or two paragraphs directly after the name, address, and contact details. Title the two paragraphs: 1) Job Experience and 2) Accomplishments. List the sentences accordingly into the two paragraphs. If there are only one or two sentences for each paragraph, they may be listed all under a single paragraph titled: Job Experiences and Accomplishments.
Hint: List the best accomplishments and/or experiences placed as the first and the last items listed in each paragraph. Most resume readers will focus only on a few words or sentences and the eye naturally zooms in on the first and last sentences.
Next, list job experience details, again listing the most current at the top and the first job held at the bottom of the list. This list will be followed by all education details.
The last line of text should state “References available upon request.” Have a separate paper with a listing of references, with contact details, to be able to hand to the interviewer. Never list reference names directly on a resume that may be emailed, faxed, or listed online anywhere.
Each paragraph title should be in bold, and either centered over the paragraph or, if you prefer, at the left margin aligned with the text. Begin each descriptive sentence with a bullet or a notation mark. Be sure to carefully review all words and text to be grammatically perfect. If even one or two grammatical mistakes have been made on a resume, they may be all that the reviewer remembers about the applicant, regardless of the accomplishments listed on the resume.
Avoid flowery text or font, particularly when applying for banking jobs. Colored paper is not advised when applying for banking careers unless it is a muted, off-white color. Since most resumes are transmitted online today, the type of paper used does not seem important. However, when meeting a prospective employer, it is a good idea to offer the employer a printed copy of the resume on high-quality paper in order to appear more organized and professional.
Interviews
In banking jobs, as is the case in most fields, an interview is the next step toward being hired. Once the applicant for a position has submitted a resume and has been asked for an interview, be it a telephone interview or a face-to-face interview, you have overcome a major hurdle.
You are now successfully positioned above all the other resumes that did not make the cut to the next step – the interview. Something in the resume matched one of the listed job titles, skills, experience, or accomplishments needed by the prospective employer.
Now is the time to do some homework. First, research the company. Find out what the company does, where they are located, and read public relations notices to become familiar with the company, its accomplishments, and events. If the company is a large firm and publicly held, researching the company’s stock and its financial status is a good idea so that the interviewee can knowledgeably discuss the firm during the interview.
If the prospect is applying to a regulatory body, knowledge of the duties and responsibilities will be crucial in being able to successfully converse with the prospective employer. Also research the position applied for, including the duties, responsibilities, and tasks. Most interviewers like to do the majority of the talking in an interview, curiously so, but a knowledgeable applicant can ask educated questions in order to keep the conversation flowing in the right direction.
Before the interview for the position, prepare the clothing to be worn at least a day before the interview. Make sure that the clothing and shoes are clean, not ripped or tattered, pressed and polished. Particularly with banking jobs, clothing and shoes should be conservative and subdued, not flashy and not too “trendy”. Men should wear a suit and tie, making sure that the belt and shoe colors match.
If the applicant does not own a suit, a suit coat or blazer with trousers that complement the blazer can be acceptable, but maybe underdressed for some firms. The suit should be a conservative color, such as brown, blue, or black. In summer, particularly in hot climates, a summer-weight suit is acceptable, and in some areas, even a conservative pastel suit may be acceptable. Women should wear pantsuits or a skirt and jacket in subdued and conservative tones. Avoid flashy colors, low cut blouses, and extremely short skirts. Shoes can be low or high heel but should be conservative.
Accessories and makeup should be kept to a minimum. The applicant’s hair, nails, teeth, and face should be neat and clean. The focus should be on the applicant’s skills, talents, accomplishments, and achievements, rather than any apparel or personal neglect that could be distracting.
If the applicant is personally acquainted with someone in the same company or field that the applicant is applying for, ask for advice about what is considered acceptable business dress. It is possible to be overdressed for an interview, and it is also possible to be underdressed or even ill-dressed for an interview.
Never be late for an interview, and it is acceptable to be five to ten minutes early. When arriving for an interview, greet the receptionist or person at the front of the office with a smile and a business card. One never knows who may be the first person seen when arriving for the interview, it might even be the person who will conduct the interview. If asked to wait briefly, and if a seat is offered, sit.
Once ushered into the room for the interview, greet the interviewer with a handshake and a smile. Offer a business card and strive to be friendly and congenial, but not overly gregarious. Sit up straight for the interview, don’t slouch or become too comfortable or drape an arm across the back of the chair or seat. If seated at a table, it is acceptable to rest hands and arms on the table, but never rest elbows on the table for any reason, as this is considered impolite body language.
Similarly, do not cross arms over each other and sit back as this also is a negative body tactic and conveys defensiveness to the interviewer. When listening, sit straight but lean slightly toward your interviewer and always offer a direct gaze. Avoid looking away. When replying, look directly at the interviewer and lean forward toward him or her. Smile often.
Be prepared to offer details about prior job experiences, and have a good answer about why the banking careers job offered is desired. A common tactic of interviewers is to ask for the applicant’s description of his or her strengths and weaknesses. Obviously, the applicant should be aware of his or her strengths and should be able to expound on any number of strengths of character and or employment background. An applicant who is prepared for these questions can successfully deflect the “weakness” question by stating a “weakness” that can also be seen as a strength of character. An example of this could be an applicant detailing his qualities as a researcher. He might state that his weakness is that he is never satisfied with his research, and feels that even if the project has been accomplished, he could probably have obtained more data, or done more research.
Once the interview has wrapped up, be sure to firmly shake the interviewer’s hand, thank him or her for the interview and the time spent speaking with the applicant. Tell the employer that you look forward to hearing from him or her.
After the interview, always send an email or a written note thanking the interviewer again for taking the time to speak about the position, reiterating that you hope that the interviewer found that you would make a good member of his “team”.
References
A prospective applicant for a job in banking should prepare for the interview by securing the approval of a few personal and three to five professional or educational references prior to meeting with the employer offering the position. Before listing anyone as a reference, always contact the person by phone or email.
Tell the person that you are applying for a job and ask the person if they would be agreeable to offering a personal reference on your behalf. Most people are honored to be asked to give a reference, and will usually give a good reference. However, be advised that a negative reference can kill any job opportunity that you seek. Carefully consider your friends, acquaintances, and coworkers before you decide to offer their name as a reference.
A good personal reference is someone whom you have known for at least two to three years or more, and who can vouch for your good character and professional attitudes with positive descriptions. A pastor or priest, a longtime family friend, or teachers are good choices. Never list a family member or relative. Employers, in general, will not believe a reference from a family member.
Professional references can be anyone for whom you have worked, including coworkers and management people. If you have volunteered your time and not been paid, such as at an internship or for work at a charity, coworkers and supervisors in these areas make good references, too. Choose people with whom you enjoyed good working relations and people who will be positive in their reference.
Once you have chosen the people you wish to list as your references, and they have given their approval, always let them know once you have actually given their name and contact information to a prospective banking career employer. Talk to your reference, and discuss the job details as well as the person with whom you interviewed.
Ask your reference to focus on discussing details about you and your skills or experience that you know the prospective employer will want to hear. For instance, if the job you are seeking is a management position, coach your reference person to discuss your skills in people managing in a positive manner with the employer. Or if the job you seek is a research position, ask the reference person to talk about your abilities and talents as a researcher. People like to be asked to be a reference but will also appreciate a bit of notice prior to the reference conversation of what they might want to discuss.
List your references with contact numbers on a sheet of paper and only offer the references if asked by your interviewer. The interviewer may prefer that you email the list after the interview. Employment law today only allows prospective employers to ask a few questions from your previous employer, namely, job title, duties (briefly) the length of your employment, and if you are eligible for rehire. Any other answers to questions, if negative, could be legally construed as slander. Hence, prospective employers prefer that the applicant produce a reference to people who will agree to answer more detailed questions about the applicant.
Banker Salary
A career in banking is a respectable profession that offers good working conditions, liberal benefits, and many advancement opportunities. The average workweek for many bankers is 36 to 38 hours per week, with many jobs occupied by part-time workers. Call center representatives can enjoy flexible evening and weekend hours. Job roles are varied, with some careers directly involved with the public, such as bank teller, loan officer, and investment manager, and some positions behind the scenes that involve accountants and business and investment analysts.
Nowadays, some functions, such as human resources, training, and computer services, maybe managed remotely in home-based locations.
The banking industry offers many challenging careers with varied educational requirements and pay scales. For instance, a mortgage processor position may pay $16,000 a year and only require a high school degree. A position for an investment analyst for a top financial firm may require an MBA in finance with a starting pay of $90,000. A banker’s salary varies by job role as well as geographic location and experience.
Although banks are located everywhere across the country, there are some regions that have a more significant presence. Areas such as Wall Street, New York, Illinois, California, North Carolina, and Texas are headquarters to many of the larger global banks.
Banks generally fall into three categories: commercial, savings and loan, or credit union. Banker salaries and career opportunities are usually greater in commercial bank settings. In addition, many banks offer other forms of compensation, such as equity sharing, bonuses, performance-based pay, and commissions on sales. While most banks are not unionized, employment in the industry is usually secure with little turnover.
Let’s take a look at some common jobs in the banking industry to see what this profession has to offer according to the Occupational Outlook Handbook, 2010-2011 edition:
• The role of a financial analyst is to help people make sound investment decisions by researching the performance of financial instruments. The role of a financial analyst is synonymous with a security analyst or investment analyst or even portfolio manager, with most positions located in larger financial institutions. A financial analyst must have good math and research skills, problem-solving abilities, attention to detail, and comfort with technology.
Most times, people in this position may work long hours, work under pressure, and travel to client sites. Most positions require a master’s of business administration (MBA) with a concentration in finance. Additional licensures, such as the Certified Financial Analyst (CFA) and continued education classes are required of some roles. The average salary for a financial analyst is between $54,000 ad $99,000, with most earning $70,000. Top earners can make up to $140,000 per year with bonuses contributing to a significant portion of the salary. Future job prospects are promising, with most jobs being offered to the most talented, educated, and experienced in the industry.
• Accountants and auditors are other common job roles in the banking profession. Most jobs require degrees in a related field, with advancement opportunities being offered to the more educated and qualified, like Certified Public Accountants (CPAs) or Certified Internal Auditors (CIAs). With all the pressure in the industry to regulate, employment opportunities in the field are expected to grow. The role of the accountant or auditor is to help analyze a company’s finances in an effort to make sure all records are accurate. Employment opportunities are found in the private sector and all levels of government. Many accountants and auditors decide to specialize in areas of reporting, such as tax law or forensic accounting. Forensic accounting is a new field and involves the prevention of crimes, such as money laundering, embezzlement, and securities fraud. The work environment for most people is in an office setting, although some financial institutions allow people in these positions to work from home. Many auditors travel frequently.
The outlook for these professions is favorable and the field is expected to grow faster than other professions. Average earnings are between $45,000 and $78,000, with top earners making over $100,000. The highest salaries are found in private consulting and investment firms. Other job roles, with similar education and experience requirements, to consider are tax examiners, collectors, revenue agents, and budget analysts.
• Accountants and auditors are other common job roles in the banking profession. Most jobs require degrees in a related field, with advancement opportunities being offered to the more educated and qualified, like Certified Public Accountants (CPAs) or Certified Internal Auditors (CIAs). With all the pressure in the industry to regulate, employment opportunities in the field are expected to grow. The role of the accountant or auditor is to help analyze a company’s finances in an effort to make sure all records are accurate.
Employment opportunities are found in the private sector and all levels of government. Many accountants and auditors decide to specialize in areas of reporting, such as tax law or forensic accounting. Forensic accounting is a new field and involves the prevention of crimes, such as money laundering, embezzlement, and securities fraud. The work environment for most people is in an office setting, although some financial institutions allow people in these positions to work from home. Many auditors travel frequently. The outlook for these professions is favorable and the field is expected to grow faster than other professions. Average earnings are between $45,000 and $78,000, with top earners making over $100,000.
The highest salaries are found in private consulting and investment firms. Other job roles, with similar education and experience requirements, to consider are tax examiners, collectors, revenue agents, and budget analysts.
Banking Associations & Journals
The most prestigious and largest banking association in the United State is the American Bankers Association (aba.com), which was founded in 1875. This association represents all banks in the United States and is recognized as the primary voice for these banks and all banking career employees in the United States.
The ABA offers products, education, resources, expertise, and a wealth of experience for its members. The ABA also offers banking certifications and continuing education through its ABA Institute of Certified Bankers.
The association also offers members a number of affiliate groups. These include the Corporation for American Banking, which endorses certain products and services to help banks; the ABA Education Foundation, which provides educational assistance to communities; the ABA Housing Partners Foundation, which promotes and provides affordable housing; the ABA Marketing Network, which offers varies networking services and events for banking professionals; the ABA Securities Association, which keeps an eye on securities policy and oversight; the Institute of Certified Bankers, a networking arm for certified banking professionals; Bankers’ Association for Finance and Trade, and the International Financial Services Association, both of which provide a forum for banking professionals in the area of global business; the American Institute of Business, which provides training and education to banking professionals; the American Bankers Insurance Association, which works to further the interests of banks in insurance; and finally, Business Solutions, which helps community bankers obtain products and services at a discount through the organization when they might not be able to procure these items by themselves.
Bankers and financial professionals can find a huge number of relevant associations, depending on what kind of banker they are, or what kind of financial work that they do. Among these are the Risk Management Association, the Society of Financial Examiners, the National Association for Information Destruction, Inc., the Fiduciary and Investment Risk Management Association, the Independent Community of Bankers of America, the American Association of Bank Directors (aabd.org), the Mortgage Bankers Association, NACHA, the Electronic Payers Association, the Consumer Bankers Association, the Bank Administration Institute, to name just a few of the many and varied banking careers organizations that help to organize, educate, and assist all the banking professions.
Networking is essential for people in banking, not only to keep abreast of banking trends, technology and policies, but to also to be aware of regulatory and political issues and prospective changes in banking laws and procedures. Such information is crucial to maintaining good business practices helping preserve profitability and fair trade. Associations fulfill a vital role in the banking industry by allowing for much discussion and exchange of ideas and theories among the members of the association. Recently, a proposed rule change on debit card interchange fees, proposed by the Federal Reserve, prompted an unprecedented call from virtually every banking association asking the Fed to review what the combined associations called the rule’s serious flaws, and asking for a corrected and revised rule. After receiving the associations’ letter, the current Chairman of the Federal Reserve was quoted later as admitting that perhaps the rule had not been as carefully reviewed as he would have preferred before publishing. This activity shows the tremendous amount of pressure that a group of associations can exert on federal regulations.
The banking and financial industry, in order to help those in bank careers and financial professionals keep up-to-date with banking trends, activities, and regulatory issues, publishes many trade journals, both in paper format as well as Internet magazines, accessible at any time online.
A few of these trade publications are: The ABA Banking Journal , published by the American Bankers Association; The Banker , providing news and views from a global banking perspective; Bank Systems + Technology (banktech.com); Bank Technology News (americanbanker.com), providing the senior banking professional with news and industry resources about banking technology, banking strategies, banking products and vendors; Investment Banking Resources (investment-banking-resources.com), covering news relating to brokerage houses, investment banking, and exchange trading; US Transactions (ustrans.com), with information relating to industry surveys and research for banking marketers; and the Credit Union Times (cutimes.com) and the Credit Union Journal (cujournal.com) for credit union professionals.
