LONDON/NEW YORK (Reuters) - Credit Suisse CSGN.VX will establish a fast-track programme for top-performing investment banking juniors, sources familiar with the situation told Reuters, as major banks step up efforts to attract and retain in their lower ranks.
The investment bank told analysts on Thursday that it would make changes to its promotion cycle in Europe, the Middle East and Africa, bringing it in line with the United States where the practice was introduced in summer 2013, sources familiar with the situation told Reuters. A spokeswoman for Credit Suisse confirmed the plans.
The programme, due to start in July, will enable top-performing analysts -- the first rung on the investment banking ladder -- to become associates in just two years rather than three, meaning they can reach vice-president level after 5-1/2 years rather than 6-1/2.
Credit Suisse’s moves are part of a trend among investment banks. A spokesman for Deutsche Bank DBKGn.DE said the lender told staff in October it would shift its promotion cycle so analysts move up after 2-1/2 years rather than three.
Citigroup Inc C.N also plans to announce a similar initiative related to junior bankers in the coming weeks.
“Citi considers talent to be among our highest strategic priorities. We have conducted an extensive, holistic review of our talent management practices, and we plan to announce some inspiring changes and enhancements in the coming weeks,” a bank spokesman said.
“Promoting people more quickly is a retention tool as the chances of the superstars leaving become slim,” said Jeanne Branthover, leader of global financial services at executive search firm Boyden in New York. “If you’re aggressive and good you’ll be promoted faster and you may not want to leave.”
Before the global financial crisis, pay packets were larger and promotion time frames more flexible. But since then banks have been struggling to retain juniors, who have been increasingly lured into other industries including technology and private equity, in search of shorter hours and higher wages.
Regular rounds of redundancies at banks in recent years and the lengthy working hours of junior bankers have dented banking’s allure.
Wall Street bank Goldman Sachs GS.N unveiled in November a series of changes designed to retain junior bankers, including promoting them more quickly and encouraging mobility within the firm.
Credit Suisse will review its analyst class of 2014 around May or June this year, before launching the fast-track programme in July, one of the sources said.
It will also broaden its mobility programme, currently generally available to more senior bankers, to allow more junior staff more options to move around and gain different experiences within the investment banking and capital markets business, the source said.
As banks grapple with very low interest rates and an uncertain economic environment, they have resorted to cost controls to boost profits. Credit Suisse this month reported its first full-year loss since 2008, missing estimates, partly due to a big impairment charge at its investment banking business.
The Swiss lender said it had accelerated cost savings and was cutting around 4,000 jobs.
Editing by Phil Berlowitz and Keith Weir