People who are interested in a career in banking usually have a better idea of what retail banking is and they might think that corporate banking is like retail banking but serving corporates instead of individuals. The broad stroke concept is true but developing a career in corporate banking is very different from that of retail banking. Such differences evolve around the various sizes and levels of complexity of the clients’ business.

What is corporate banking?

Corporate banking could be an umbrella term referring to banking services provided for corporate customers. It offers loans, cash management services, trade finance services and other services to facilitate the corporates’ operation. Corporate banking can be categorised by the size of the clients they serve. Banking activities serving small businesses are also understood as commercial banking.

Commercial banking serves small and medium-sized enterprises (SME) with a revenue below $100 million and middle-market enterprises (MME) with a revenue ranging between $0.1 billion to over $1 billion and the non-listed companies. Corporate banking serves large corporates and non-bank financial institutions (NBFI) such as securities firm and loan companies. The three types of large corporates that corporate banks serve are:

1. global and wholesale banking such as Standard Chartered and Institutional Banking Group (IBG, DBS);
2. the locally listed corporates, also known as ‘blue chips’, and the listed corporates on main board or growth enterprise market (GEM);
3. China’s corporates, the ‘red chips’, which include both state-owned enterprises and private enterprises.

While many locally incorporated banks have corporate banking arms, there are also some lesser-known foreign corporate banks in Hong Kong such as Sumitomo Mitsui Banking Corporation (SMBC) and Mizuho Bank from Japan, China Trust Banking Corp (CTBC) and Bank Sinopac from Taiwan, and United Overseas Bank (UOB) from Singapore.

What banking products do they offer?

Developing a career in commercial and corporate banking is fascinating and challenging at the same time because of the vast difference between the clients you serve. Your clients could be of any industries, structures and business models. If you work as relationship managers, you will partner with different product experts to come up with ingenious financial solutions for your clients. Products for SME or MME often include unsecured lending, business investment, insurance, trade finances, LCs and factoring; products for large corporates could be syndicated loan, transaction banking, securities, margin financing, foreign exchange (FX), Pre-IPO and IPO, or other cross-border products such as Overseas Loans under Domestic Guarantees specifically designed for the Chinese corporates.

Whom would they hire?

Qualification and experience requirement for SME banking is very different from MME and corporate banking. Although B2B sales or direct sales experience, and a degree in Economics, Finance, Accounting or BBA are preferrable, you don’t need other professional qualifications to apply for SME banking jobs.

Whereas for MME banking and corporate banking, more often than not they are looking for candidates with a specific skillset or experience. Qualification-wise, employers may expect candidates to be qualified Chartered Financial Analyst (CFA), Financial Risk Manager (FRM), Certified Public Accountant (CPA), or to have obtained some qualifications within the Enhanced Competency Framework (ECF) provided by Hong Kong Institute of Bankers (HKIB). Employers would expect candidates to have done credit assessment and mainland site visits, and have experience with different corporate bank products. In a long run, exposure to the clients’ industries becomes your unique asset boosting your employability.

What salary level do they offer?

Due to the more stringent hiring criteria, corporate banking usually offers better salary for the same rank in SME banking. The following table shows the titles and salary range offered by SME banking and MME / corporate banking.

Where will it lead you to?

For those who wants to explore other green pastures after working in the front office of corporate banking, they have an option to work in corporate finance (project finance, IPO), financial market (as sales trader), or treasury marketing (FX hedging and investment), or to start their own business in consulting. Other middle office jobs, such as credit marketing manager, or back office jobs, such as credit officer / analyst or credit manager are also viable paths.