TAustralia Banking & Financial Services Salary Survey 2012-13

Legal: Banking & Financial ServicesMarket Update & Salary Guide 2012/2013

Australia

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Legal: Banking & Financial Services: Market Update and Salary Guide 2012/2013

Introduction

We are pleased to present the Taylor Root in-house Legal Market Survey for the Banking and Financial Services (B&FS) industry sector for 2012-13. Our data analysis and trends cover Sydney and Melbourne given they are home to the majority of in-house counsel roles in this sector. We can provide relevant salary ranges for other cities on request.

Other legal industry sectors such as commerce & industry, private practice and compliance/risk are all covered in separate surveys and can be accessed via our website at taylorroot.com.

We aim to provide an accurate reflection of market conditions, supply and demand, remuneration levels and any other significant developments of note to have impacted on the in-house counsel market over the last 12 months, whilst also looking forward to 2013.

A significant amount of data was collected from clients across the various B&FS market sub-sectors via an online

questionnaire. Salary information was also gathered from our extensive database of candidate lawyers and clients, who we have assisted in recruitment processes over the last 12 months and more. Sectors covered in this survey include retail, investment and corporate banking, wealth management, superannuation, insurance and funds management.

It is worth noting that when reviewing salary and benefits across the industry, there can be significant differences for similarly-qualified solicitors depending on skill set and type of employer. For example, salary levels compare more favourably in the investment banking or funds management sector compared with retail banking or insurance for lawyers with similar levels of experience and tenure. For the most accurate advice on salary levels and remuneration packages, please contact a member of our in-house recruitment team.

As always, feedback is welcome so please feel free to let us know your thoughts.

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Brian Rollo Group Manager


Over the past 12 months in the B&FS sector, the slow down in recruitment activity which started in 2011 across Australia continued to hamper candidates seeking new in-house opportunities. Only 20% of organisations in the B&FS sector actually recruited any lawyers into their in-house team in the last 12 months compared to more than 50% in the previous year. Of more significance, only 5% of respondents reported a net increase in the numbers of lawyers within their team. This compares to over 45% of companies increasing numbers in the financial year of 2011-12 and has been the most significant shift in the supply-demand dynamic, particularly within the banking sector itself.

This relative lack of demand has resulted in the overall net effect of fewer open vacancies on offer and an increasingly competitive candidate market. There are noticeably more high-calibre candidates chasing those same rare opportunities in comparison to the plentiful supply of vacancies pre-GFC and through calendar year 2010, for example.

Projecting forward over the next 12 months, the overwhelming number of General Counsel/Heads of Legal predict that their legal team headcount will remain the same, just over 75%, with the most common reason being hiring constraints and lack of budget. Less than 20% thought that their team would experience net growth in numbers through

2013. Although this number may actually seem quite high, this can be explained by the current “threadbare” make up of many legal teams due to forced and voluntary redundancies over the last 18 months. The belief, or hope, amongst clients being that any significant increase in workflow will result in new legal counsel hiring.

There have been very few high-profile General Counsel level opportunities or movement over the last 12 months mainly due to incumbents lacking more attractive alternatives elsewhere, either in Australia or regionally across Asia Pacific. The resultant “merry-go-round” effect has, therefore, not really been seen in recent times.

It is at the level below General Counsel, however, that we have seen the most acute shortage in vacancies. These Senior Counsel or Deputy General Counsel level roles with salaries in the $220,000 to $300,000 range have been few and far between over the last 12 months. This, again, can be explained by the lack of corporate growth and available budget to recruit senior-level lawyers. Instead, financial institutions are opting to hire less experienced mid-level lawyers who cost less and can provide some relief from the bottle-neck of Senior Counsel who are looking for the next promotion. Given ongoing concerns around headcount and cost, this trend looks likely to continue over the next 12 month period.

Market Overview

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The attraction of an in-house legal career is still strong amongst banking and finance lawyers. However, there has also been a larger number of reverse moves back to private practice over the last 12 months than we have seen for a number of years. There is also some suggestion that the number of top-tier lawyers who are looking to move in-house may have dropped somewhat in the last year. This can be explained by any of the following reasons or perceptions:

• The lack of in-house opportunities in the sector, prolonged over the last two years;• Ongoing structural and regulatory problems for global financial institutions to resolve;• The higher guaranteed remuneration available within private practice in Australia for lawyers with these skills.

The increased hesitancy of candidates who would ordinarily be looking to move in-house means that identification of the highest-calibre candidates has continued to be a challenge for those employers who have been recruiting in this space. This is coupled with hiring managers becoming less flexible

and more prescriptive in their hiring criteria under current market conditions. Therefore, the recruitment process has remained challenging for most types of banking and finance roles, despite the relative lack of competing job opportunities.

Companies still utilise secondee options from panel firms as a solution to short term resourcing issues as well as employing lawyers on a fixed term or temporary basis for similar reasons. Typically these contract lawyers will cover maternity leave positions or provide additional resources for specific projects. The last 12 months has seen a poportional increase in secondee deployment and temporary contractors due to headcount constraints. This was predicted last year and we expect this increased supply of contract opportunities to continue for the next 6-12 months.

The bulk of in-house recruitment takes place at the 4-8 year level of post admission experience. It is relatively uncommon for B&FS organisations to recruit lawyers with less than three year’s experience, although there has been a slight increase in roles at this level compared to previous years.

Market Overview Continued

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Joanne Bews Consultant


In a similar vein to last year, in-house B&FS legal hiring trends have largely followed the fortunes of the global economy. For instance, investment banks have continued to feel the impact of global economic headwinds and regulatory issues in Europe and North America. Locally, this has meant enforced headcount reductions and hiring freezes being imposed from overseas head offices. As a result, 2012 has seen one of the lowest levels of hiring and vacancies in IB legal teams in recent times. More specifically, transactional banking and finance, capital markets or financial markets in-house legal roles in the last 12-18 months have been few and far between. Capital markets and M&A activity has been very low as have trading volumes in financial markets. All this

equates to less transactional work for in-house counsel in the investment banks.

By contrast, the Australian banking groups have been active with more frequent strategic or business-critical legal hires occurring, reflecting the relative ongoing strong financial performance and health of the Big 4 banks. There have been a variety of roles requiring superannuation, life and insurance product and regulatory experience, as well as broader corporate/commercial, distribution and advisory roles, all available on a fairly consistent basis from local and international FS companies this year.

Demand

International Candidates

Much like 12 months ago, there is little appetite within banking and financial institutions to recruit lawyers directly from international markets, with the exception of internal transfers. Several years ago, lawyers with specialist transferable skills (e.g. derivatives, capital markets, funds, banking) could find work relatively easily in-house in Australia, but that has not been the case since the downturn in 2008/2009. While leading law firms in Australia have

continued to readily source talent from other jurisdictions, there still remains a general reluctance from in-house teams given restrictions on headcount and recruitment spend.

For foreign-qualified B&FS lawyers with no Australian experience (even including those from top-tier firms in the UK or US) it is still a struggle to obtain a role directly in-house in Australia, including for those already on the ground here.

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Remuneration & Benefits

With the more subdued market conditions and cost controls in place over the last 12 months, salary reviews within the B&FS sector have been modest. 30% of respondents awarded increases of 1-3% (e.g. investment banking or corporate banking sectors) while 35% awarded between 4-7% (e.g. retail financial services or wealth management sectors). 15% of respondents gave no review.

Annual bonus payments almost always make up an element of remuneration package for in-house B&FS lawyers. Around 85% of respondents awarded a performance-related bonus in 2012, most typically awarded on company and individual performance. Just over 60% of respondents noted bonus values between 1-20% of annual base salary, with 30% paying around 20-30%.

Investment banking legal salaries and total remuneration packages continue to lead the market, despite the salary stagnation in that specific sector over the last 12 months. Where bonuses are being paid, they are generally paid between 10 – 35% of salary within this sector, however, there are examples of some specialist, business-facing legal roles which pay significantly higher than this range.

Retail banks and retail financial services/wealth management companies have remained competitive with each other and have raised salaries modestly but consistently in the last year. Bonuses in this sector remain consistent at around 5 – 25% on average.

As mentioned in our last survey, lower demand for senior candidates on the open market, as well as restricted recruitment headcount budgets, mean that sign-on and guaranteed bonuses are still extremely rare.

Our expectation is that salary reviews for the coming year will be similar to 2012, with steady, modest increases across the board. It is unlikely that investment banking salary packages will increase significantly for some time.

On the following pages we have detailed the results of our salary findings. Please note that salary bandings can be very broad for lawyers working in-house. Typically, these ranges broaden with seniority as specific responsibility will differ between organisations. For example, a senior role with team management and a wide geographical responsibility (e.g. Asia Pacific) will remunerate at the upper end of the band compared to a sole legal counsel role with local responsibility. Senior salary levels are dependent on a number of factors including:

• Their background and experience;

• Reporting lines;

• The size of the organisation recruiting;

• The legal function (for example, whether the lawyer is hands-on or manages the legal function only);

• The industry sector;

• Company performance; and

• The scope of responsibility (including people management, geographical or otherwise) included in the role.

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Salary Data - Points to Note

• We have identified each employer as falling into one of two categories, depending on the scale and function of the business, and particularly the size of the in-house legal division. Large domestic or international organisations (Tier 1) will typically remunerate at the mid to top-end of the salary range, while smaller domestic or boutique international businesses (Tier 2) tend to remunerate at the mid to bottom-end of the range. However, with the growth in some high-margin “boutiques” and the rigidity of several major financial institutions’ salary bands, this typical pattern can sometimes be reversed.

• Figures refer to salary packages inclusive of superannuation but exclude bonus and other benefits.

• For specific advice on salary levels and benefits or for a discussion around any of the points and figures in the survey, please contact one of our in-house banking and finance legal team, contact details included within.

• Brisbane, Perth, Adelaide and other city or regional data can be discussed with one of our consultants directly on request.

• Salary package figures current as at November 1st 2012.

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Tara Sacks Senior Consultant

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Salaries - Sydney


Investment Banking / Financial Markets / Structured FinanceTier 1 Tier 2

0 - 2 years $85,000 - $105,000 $78,000 - $100,000

3 - 5 years $100,000 - $155,000 $98,000 - $147,000

5 - 7 years $135,000 - $195,000 $130,000 - $185,000

7 - 10 years $160,000 - $240,000 $150,000 - $225,000

10+ years $200,000 - $280,000 $180,000 - $240,000

Manager / ED / MD $250,000 - $375,000 $220,000 - $300,000

General Counsel $350,000+ $240,000+

Corporate Banking / Debt FinanceTier 1 Tier 2

0 - 2 years $80,000 - $105,000 $77,000 - $100,000

3 - 5 years $96,000- $140,000 $92,000 - $140,000

5 - 7 years $135,000 - $180,000 $130,000 - $170,000

7 - 10 years $160,000 - $220,000 $150,000 - $205,000

10+ years $190,000 - $250,000 $175,000 - $225,000

Manager / ED /MD $220,000 - $320,000 $210,000 - $280,000


Funds / Investment ManagementLarge / International Small / Domestic

0 - 2 years $75,000 - $100,000 $75,000 - $95,000

3 - 5 years $112,000 - $150,000 $95,000 - $140,000

5 - 7 years $140,000- $175,000 $130,000 - $170,000

7 - 10 years $160,000 - $220,000 $145,000 - $210,000

10+ / Manager $180,000 - $245,000 $170,000 - $235,000



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Retail Banking / Financial ServicesTier 1 Tier 2

0 - 2 years $75,000 - $100,000 $70,000 – $90,000

3 - 5 years $110,000 - $145,000 $100,000 - $135,000

5 - 7 years $135,000 - $180,000 $130,000 - $170,000

7 - 10 years $165,000 - $220,000 $155,000 – $205,000

10+ / Manager $180,000 – $250,000 $170,000 - $230,000


InsuranceTier 1 Tier 2

0 - 2 years $75,000 - $95,000 $75,000 - $92,000

3 - 5 years $105,000 - $135,000 $100,000 – $125,000

5 - 7 years $130,000 - $180,000 $125,000 - $160,000

7 - 10 years $155,000 - $195,000 $152,000 - $180,000

10+ / Manager $180,000 - $280,000 $170,000 - $240,000


Wealth Management / SupperannuationTier 1 Tier 2

0 - 2 years $75,000 - $100,000 $70,000 - $95,000

3 - 5 years $105,000 - $138,000 $95,000 – $126,000

5 - 7 years $130,000- $175,000 $122,000 - $165,000

7 - 10 years $155,000 - $210,000 $150,000 - $185,000

10+ / Manager $180,000 - $250,000 $175,000 - $225,000



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Salaries - Melbourne

Investment Banking / Financial Markets / Structured FinanceTier 1 Tier 2

0 - 2 years $85,000 - $105,000 $80,000 - $95,000

3 - 5 years $100,000 - $155,000 $95,000 - $145,000

5 - 7 years $135,000 - $195,000 $130,000 - $180,000

7 - 10 years $160,000 - $240,000 $150,000 - $225,000

10+ years $200,000 - $280,000 $175,000 - $230,000

Manager / ED / MD $220,000 - $300,000 $200,000 - $270,000


Corporate Banking / Debt FinanceTier 1 Tier 2

0 - 2 years $80,000 - $100,000 $75,000 - $95,000

3 - 5 years $95,000- $140,000 $90,000 - $140,000

5 - 7 years $135,000 - $180,000 $130,000 - $165,000

7 - 10 years $160,000 - $220,000 $150,000 - $205,000

10+ years $190,000 - $250,000 $175,000 - $225,000

Manager / ED /MD $210,000 - $300,000 $200,000 - $275,000


Funds / Investment ManagementLarge / International Small / Domestic

0 - 2 years $75,000 - $95,000 $75,000 - $90,000

3 - 5 years $100,000 - $150,000 $95,000 - $140,000

5 - 7 years $140,000- $175,000 $130,000 - $170,000

7 - 10 years $160,000 - $220,000 $150,000 - $210,000

10+ / Manager $180,000 - $245,000 $170,000 - $235,000



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Retail Banking / Financial ServicesTier 1 Tier 2

0 - 2 years $75,000 - $95,000 $70,000 – $90,000

3 - 5 years $100,000 - $135,000 $95,000 - $120,000

5 - 7 years $130,000 - $180,000 $125,000 - $165,000

7 - 10 years $150,000 - $210,000 $140,000 – $195,000

10+ / Manager $170,000 – $250,000 $160,000 - $225,000

General Counsel $350,000+ $270,000 +

InsuranceTier 1 Tier 2

0 - 2 years $70,000 - $95,000 $70,000 - $90,000

3 - 5 years $100,000 - $130,000 $95,000 – $120,000

5 - 7 years $125,000- $180,000 $120,000 - $160,000

7 - 10 years $155,000 - $200,000 $145,000 - $180,000

10+ / Manager $170,000 - $225,000 $165,000 - $210,000

General Counsel $250,000+ $200,000 +

Wealth Management / SupperannuationTier 1 Tier 2

0 - 2 years $80,000 - $95,000 $75,000 - $90,000

3 - 5 years $95,000 - $135,000 $90,000 – $125,000

5 - 7 years $130,000- $175,000 $120,000 - $165,000

7 - 10 years $150,000 - $210,000 $145,000 - $185,000

10+ / Manager $180,000 - $225,000 $175,000 - $220,000


Note: All salaries are inclusive of superannuation, but exclusive of added benefits (e.g. bonuses, car allowances, share options, long-term incentives etc).

Your Taylor Root Contacts For further information on the Australian in-house banking & financial services recruitment market, please contact a member of our team on + 612 9236 9000 (Sydney) or + 613 8610 8400 (Melbourne):

Sydney OfficeDavid Buckley [email protected]

Brian Rollo Group [email protected]

Joanne Bews [email protected]

Melbourne OfficeTim Fogarty [email protected]

Tara Sacks Senior [email protected]

Taylor Root is a member of The Specialist Recruitment Group PTY LTD (The SR Group). The SR Group is a specialist recruitment consultancy dedicated to raising standards in the business environments that we serve. The sectors we cover include tax, legal, compliance, human resources, marketing and executive search, dealing with a substantial number of the world’s leading professional partnerships, multi-national corporations and international banking groups as well as small to medium sized developing organisations.

Please note that Taylor Root conduct salary surveys and market reports for other jurisdictions around the world. For details visit taylorroot.com

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Sydney Level 12, 25 Bligh Street SydneyNSW 2000T: +61 (0)2 9236 9000

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TAustralia Banking & Financial Services Salary Survey 2012-13

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Transcript of TAustralia Banking & Financial Services Salary Survey 2012-13