Banks and financial institutions are increasingly exposed to various kinds of risk - both financial and non-financial. The audit function provides essential monitoring services across the enterprise which are often required to be more robust than those in other commercial organizations.
The function
The Audit function is responsible for designing and implementing internal control systems to limit risk, for ensuring compliance to policy and to statutory requirements as well as the adoption of prudential guidelines. Many financial organizations refer to the audit function as Risk Management and Compliance which more accurately describes its area of operation in the modern age.
Banking and Finance institutions have very tight regulatory and governance requirements which need to be reported on externally in addition to internal corporate reporting. As a result, the new job roles ask for skills in planning and defining effective internal controls, implementing continuous system improvements and designing testing and monitoring procedures. Risk-based audit reviews and assessments are planned and actioned at regular intervals to identify weaknesses in internal processes and to recommend suitable solutions.
The skills needed
Central to the audit role is a good understanding of risk services, internal audit methodology and enterprise risk management. A working knowledge of Sarbanes Oxley regulations is becoming increasingly important. Since risk management and audit services do not work in a vacuum, practitioners in this field require a highly developed level of inter-personal skills as they have to engage on a day-to-day basis with stakeholders and divisional heads.
The trends
Traditional ways of managing financial audits are being rapidly replaced by a more contemporary approach. Transaction-focused, passive bureaucratic checking is being phased out in favour of value-creating business processes that are based on prevention and which are time and cost efficient.
The major change is the extensive application of information technology and systems. Business processes are increasingly being automated and controls becoming less person dependant. As a result, the scope for error and wrong-doing is limited as customized tracking reports can be created for all activities. Banks and financial services organizations compete for the same skills and require a level of IT competency that may attract a premium in the market.
The Financial Services industry has become more complex, offering new products in more channels resulting in the need for scrutiny of a large amount of data and having systems to manage it. There are some IT challenges facing the industry today such as how to drive down transaction costs, expand and improve customer service whilst ensuring integrity of information. The traditional accounting-and- checking image of the audit function has since been superseded by the risk, governance and compliance roles.
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The traditional role of the compliance function in banking of checking and monitoring operational activities is moving away from a “policing” approach more towards an advisory role.
However, a bank's senior leadership must implement adequate and functional risk controls in operating activities to prevent losses and ensure that employees abide by laws of the land when performing tasks. Today, the compliance manager is often involved in executing compliance controls over daily business transactions as well as providing ongoing compliance oversight. He needs to be both proactive and reactive - helping to ensure that new business is compliant as well as monitoring existing business.
Compliance job roles are required in all divisions of banking at all senior levels: investment, retail, corporate and business banking, credit and loans. There are three main types of risk which must be managed:
Compliance risk : the risk of direct financial loss from failure to meet laws, regulations, internal standards and policies and the expectations of key stakeholders.
Reputational risk : damage that can occur when business behaviour is viewed as inappropriate by stakeholders, whether regulators, customers, other market operators, or the public at large.
Regulatory risk : the risk of sanctions for breaching applicable laws and regulations and/or for not meeting regulatory expectations.
Salary packages in banking compliance are generous and the function has a growing future, providing a career path for aspiring compliance directors. At a senior level the responsibilities would include establishing and implementing a compliance framework and function for the Bank as well as monitoring the Bank’s business activities, sales practices, documents and marketing material, and clients’ statements to ensure compliance with local regulatory requirements.
Additionally, the compliance manager must communicate policy and procedure throughout the Bank and investigate and resolve problems in a timely fashion following established guidelines. One of the main objectives is to create awareness of risks to reputation and integrity and the consequences of regulations within business units.
A bank compliance manager usually has a bachelor's degree in a business-related field or regulatory management. A senior banking compliance manager typically holds a master's degree in business management.
On a personal level, a compliance manager must have good interpersonal skills and the ability to work in collaboration with team members and business partners, such as customers and suppliers. Part of his/her role is to achieve a level of cooperation and understanding internally so that the Bank is exposed minimally to the various types of risk. Recent events relating to collusion and price fixing have highlighted the role of compliance in the financial services industry.
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Keen to work in investment banking in Africa?
Many of the top investment banks are expanding into Africa. The principal purpose of an investment bank (and of investment banking in general) is the underwriting of new securities issued by an investment bank's clients. An investment bank may also provide other services, such as professional advice, working with mergers & acquisitions, and private wealth management. Unlike commercial banks and retail banks, investment banks do not normally take deposits.
The most well-known global investment banks are Goldman Sachs, JP Morgan and Morgan Stanley. Other investment banks are regionally oriented or situated in the mid-size market, or are small, specialized firms called boutiques which might be oriented toward a specific niche.
There are two main lines of business in investment banking. Trading securities for cash or for other securities is known as the "sell side", while dealing with pension funds, mutual funds, hedge funds, and the investing public (who consume the products and services of the sell-side in order to maximize their return on investment) constitutes the "buy side". Many firms have buy and sell side components.
These firms have lots of different areas and groups within them, some roles are specific to the function of investment banking and some are support roles found in all companies. The support roles such as human resources, legal, marketing, investor relations and information technology are also needed in investment banking.
Departments specific to this industry that require definite skills are:
• Corporate Finance / Private Equity
• Securities and Trading
• Treasury
• Compliance
• Financial Management
• Investment Research
• Merchant Banking
An investment banker’s job description may cover many different areas, especially within developing markets in Africa. Most investment bankers start at the bottom, working as financial analysts or some other entry-level position for at least three to five years.
Most aspiring investment bankers will have a degree in a finance related field, such as economics, marketing or accounting and maybe an MBA. The skills and attributes most sought after are:
• Advanced financial analysis capabilities and computer skills
• Ability to research and prepare proposals on prospective business deals
• Up to date knowledge of current financial events and news within the region
• Adaptability to new cultures and different business methods
• Well developed inter-personal skills and ability to persuade
• Foreign language skills especially French and/or Portuguese
In investment banking expect to work very long hours and take on extra responsibilities in order to get on the path to success.
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Expat Jobs in Banking
Interested to find out about expat jobs in the Banking Sector? The range of functions that banks require to fill is wide and not limited to banking specific skills. There are openings for auditors, human resources and sales and legal professionals in many countries in Africa in both global and regional banking and finance organizations.
Investment banking can be lucrative and rewarding in emerging markets. There are opportunities literally everywhere from Cape to Cairo
Due to the expansion in the finance sector in Africa, business development and relationship management jobs are becoming more plentiful in many new markets, including Algeria and Gabon Kenya and Nigeria
As a result of the growth in banking within countries and across the region, there are opportunities for qualified people in all management and support functions. All companies need leaders; aspiring managing and finance directors will find attractive vacancies which provide wider scope than working only within one country. There is a need for Human Resources specialists, especially in recruitment, training and management development in the new growth markets. If you are looking for an expat job in Banking or finance, click here.
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What is Microfinance?
Microfinance is the provision of financial services such as loans, savings, insurance, and training to people living in poverty. Many diverse types of organizations are involved in this sector. Although dedicated Microfinance Institutions are the largest percentage, they are followed by Non-Governmental Organizations (NGOs), financial co-operatives, development projects, all practicing microfinance. Banks are not extensively involved in this function.
Microfinance is one of the great success stories in the developing world in the last 30 years and is widely recognized as a just and sustainable solution in alleviating global poverty. Over the last decade the microfinance sector in Africa has expanded its financial service offerings to better meet client needs. For example, The International Finance Corporation (IFC), the private sector arm of the World Bank Group, has $4 billion invested in various kinds of financial institutions in 88 countries: including banks, leasing companies, credit rating agencies, and pension funds.
Jobs in the microfinance sector are very interesting and varied. There are opportunities for business development officers that drive and manage business activities at regional and branch level, branch managers and loans officers that assess and fulfill client requirements.
Personal attributes that are prized in microfinance are self-motivation, maturity and interest in social and economic issues.
Microfinance organizations make it a priority to serve the particular needs of women, since more than 70 percent of all those living in extreme poverty are female. Women are often excluded from education, the workplace, owning property and equal participation in politics. They produce one half of the world’s food, but own just one percent of its farmland. When women improve their circumstances, they also improve the lives of their children. By investing in nutrition and education, they help to create a better future for their children and their communities.
The World Bank says that the industry is not close to meeting the demand despite excellent progress. Five hundred million people living in poverty could benefit from a small business loan and only one-third of the world’s population has access to any kind of bank account. The lack of access is particularly severe in sub-Saharan Africa providing attractive work opportunities in microfinance in Africa.
More about microfinance.
http://www.un.org/esa/africa/microfinanceinafrica.pdf
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Banking jobs in Africa
Available jobs in banking in Africa are becoming more plentiful as the global recession recedes. Expatriates working in the banking sector enjoy premium salaries, low taxation, attractive benefits and generous leave provisions. Opportunities abound for ambitious professionals to drive the growth strategy and business development of major international and regional banks in Africa. You can impact the profitability and market share of an organization and exert influence on its place in a given market. You can build a sizeable reputation for yourself within the banking sector at the same time.
Solid banking experience can be useful not only in the financial sector but also across other industries such as oil and gas, mining, logistics and telecommunications. All successful large multinational companies have a treasury function that manages their external financial transactions and ensures compliance to government regulations and internal procedures. Risk management is a career which rose into prominence in the finance sector but is a role that is increasing in importance within the manufacturing, FMCG and other business sectors.
You don’t have to be a banker to work in the banking sector. All the normal business functions have to be fulfilled in a banking enterprise, marketing, human resources, but fiancé houses especially need experienced people in I.T and telecoms, cash management, logistics, facilities management and security. Expat life in Africa is an attractive option if you work in the banking sector.
Micro-finance is a growing business area in the banking sector in most emerging markets and Africa is leading the way. Openings are available to start new business ventures from scratch where initiative and innovation are part of the job requirements. Working with local partners and being involved in the growth of a start-up can be really rewarding, both personally and financially.
Many expat opportunities are available at all managerial levels and in specialist functions. If you have a degree and a sense of adventure, consider looking for jobs in banking in Africa.
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