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Trends for top talent.

Skills become obsolete just as quickly as new talents are needed; continuously evolving as the world around them change.

The P4Capital team investigates what skills are desperately needed in the capital markets today, and how companies can capture them.

Stay tuned.

Transcript


Amanda: Who are the people your company should be looking for? What skills should you have to make yourself appealing to those employers? In this week’s round table discussion, the P4Capital executive team examines who the top talents are, and what skills they possess.

Stay tuned.

Jim: Today’s topic is about what needs we have seen in the technology/ capital markets area since the beginning of January of 2015.

Archana: For those of you just tuning into our weekly podcasts, a quick round of intros – we are the P4Capital team. A division of the established Planet4IT staffing agency, and we are the people who are close to the market makers – the Capital Markets as well as the wealth management professionals. And yes, we are nearing the end of the of the first quarter, and what we plan on doing, just like Jim said, just discussing in terms of where financial technology stands, and also a quick handbook for job aspirants; what are the skills that would be in demand for the rest of the year.

Shaheerah: I just want to start out with the importance of the capital markets: capital markets are where  both Canadian and International companies from all over the world come to raise capital in order to run their businesses and to expand globally. And it’s going to be done both through debt and also through equity. And Capital Markets is also a place where companies can come out and they can seek advice on potential transactions and strategic advice on implementing their business plans. And although this is a male dominated industry, there is now a growing need for women in the field as well. And you will see a lot of companies are launching new programs in order to attract more females into this career.

Jim: The interesting part is in the trading side of the financial institutions business, is we’ve gone through 36 months of high frequency routers, dark pools, low latency – and the rationale behind all that was to get better analytics on the trade, get better understandings of liquidity; obviously there’s been a heavy influx of new regulations and reporting. And that’s kind of affected the old creaky systems that have populated the world. So the talent, not only are we looking for the best and brightest of the female and male side, but we’re also looking for difference makers now too. And we hope to carry on more conversation about that momentarily.

Jeremy: Risk Data Aggregation and Reporting, RDARR* as it’s written sometimes, seems to be a big hot button topic for all of our clients. There’s a Basel 3 deadline with 21 months to go now, December 21 2016 that needs to be met, and all the banks and financial players in town need people who understand risk and are able to put it together into a model that will make sense for decision makers.

Archana:  Some of the trends that we’ve witnessed so far, and something that we’re definitely going to see more of, going forward, obviously the falling oil prices that’s been a hot button topic really, and a lot of the banks and financial services companies have been majorly impacted with the falling oil prices. Another thing that’s happening that we’ve witnessed is restructuring: a lot of banks are shutting down and really focusing on their core business and trying to automate a lot of these processes that don’t really have direct customer interaction. Another thing that we’ve witnessed, and this is definitely a growing, trend is  I call it the deconstruction of the traditional walls that have surrounded the large investment banks and how they’ve been privy to customer information and access to all this data. So this deconstruction obviously is happening as we speak, because access to data in this changing market is majorly on the rise. And another growing trend where banks are losing out on hiring talent is definitely to the digital guys, so banks are revamping their strategy to attract the brightest minds that are out there.

Jim: The position growth, if you will, I’ve also kind of thought to myself was interesting it’s core programming: Java, C, C#, C++. I  haven’t as yet seen the advanced analytics programming needs that the digital world is demanding, the R’s, the Matlabs, s and those types. We’ve also seen a heavy influx of business analysis. So people, as Jeremy alluded to, anything that has a strong element of risk process knowledge is in great demand out there. Traded products, front office products – also in great demand out there. Traditional, other support jobs like software package support or infrastructure support, not as much. But hardcore developers yes, hardcore business analysts with solid process knowledge, yes.

Archana: I agree with Jim that we haven’t seen so much of big data and data analytics on the capital markets, side, but I do think that’s something that’s set to change going forward. A lot of these data scientists have been employed by these capital markets firms. They’ve largely been restricted to governments, risk and compliance areas, but increasingly they are going to be used in the front office, and working hand in hand with the Quant guys.

Jeremy: Especially when we get to the phase where banks are going to be analyzing data in real-time, they’re really going to bring in some new and dynamic solutions. We’re really going to see that in the next year.

Jim: I’m hoping though that those people are still available for them Jeremy. We’ve seen in our Planet4IT part of the business, where people with knowledge of how to program advanced algorithms are being captured by game companies, big market data companies that have a service feel to them. And where do they draw them from? Obviously the traded markets, and the people that learned their skills there and have applied them successfully, and they’re being offered great sums of money to do so. I’m 100% in agreement that the front office people will have to come back onto the market, but I think they’re being overshadowed right now by the need for regulation people.

*RDARR stands for Risk Data Aggregation and Risk Reporting program


 

That was the P4Capital team discussing the Trends for Top talent, and how to be competitive in the workforce. Want to know more? Check out our website  and previous posts at www.planet4it.com or follow us @p4capital. Thanks and see you next time.

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Volckers Volley or Folly

Paul Volcker is an American economist who was the chairman of the Federal Reserve, under Presidents Jimmy Carter and Ronald Reagan. He is still working though, and is still making recommendations that could forever change the American banking scene.

The P4Capital team investigates.

Stay tuned.

Transcript


Amanda: Change is never easy – but sometimes it is necessary. In this week’s round table discussion the P4Capital executive team talks about former chairman of the Federal Reserve, Paul Volcker, and changes he is recommending be made to US banking.

Jim: Today’s topic, or this week’s topic, is about Paul Volcker’s recommendation to put US banking and financial industry under one roof.

Shaheerah: Yes, he has outlined a new plan for revamping the way that the US government is going to oversee their financial plans. And he’s going to be publishing a paper soon which is going to talk about consolidating and reorganizing the US financial regulators, so what they’re going to do is create one single agency to supervise the financial institutions, while the Federal Reserve will be responsible for writing these regulations.

Archana: Paul Volcker is not new to devising strategies. When he was the Chairman of the Federal Reserve he actually was the person who in fact tamed inflation at that time. More recently, he also came up with the Dodd Frank initiative itself, where we wanted banks to engage less and less in risky, Wall Street style trading, and I guess this Volcker Alliance, which terms itself as a think tank, was basically set up to improve the way government essentially works at the local state and the federal level in terms of policy making and the financial decision-making.

Jim: With that said is, the current system in the US has a heavy regulation feel to it. The institutions that play in the US are now pushing back at a fairly aggressive rate, of saying “My business is my business. My business is not supporting your regulation.” In fact, the US has leaned heavily on the regulators side over the last seven years since 2008. Some of the legislation is badly needed, but some is over the top and more importantly, in Volcker’s words, is “why is the futures exchange being regulated by the Ministry of Agriculture?”

Shaheerah: This new plan is that the Fed would write the regulations, and then another agency would make sure that these rules and regulations were actually being followed. So this would be a combination of the Federal Deposit Insurance Corporation, the office of the controller of the currency, the Fed and then the other regulators such as the SEC and the CTFC. Paul Volcker was also responsible for proposing the Volcker rule, and the role prohibits short-term proprietary trading that Archana was talking about, of the securities of the securities, derivatives, commodity futures and options on these instruments on their banks’ own accounts. Basically this rule is to prohibit activities that don’t benefit the banks’ customers.

Jim: But in fact benefit the banks themselves, as long as they introduce the element of low to very high risk. Correct Shaheerah?

Shaheerah: Yup. And it was estimated that the banks would have to hire 3000 new employees in order to implement these rules, and another study had already mentioned that it would actually cost 350 million dollars for the banks and the investors in order to implement this rule.

Jim: So a billion dollar overhead put onto the banks by and large by the representatives that may or may not have their voters’ best interests at heart. It’s an interesting conundrum. We are hoping Paul Volcker wins this one.

Archana: So by the way, while we’re on this topic of regulations and compliance, we at P4Capital – we specialize in these kinds of jobs. So if you’re a person, or a capital markets professional with specialization in this area, or any other capital markets area, please do not hesitate to either give us a call or to send us your resume. We absolutely look forward to hearing from you. And that number by the way that we can be reached at is (416)363-9888. And you can either ask for Shaheerah Kayani or Archana Ravinder.

Jim: And the interesting part of what Archana just mentioned there, is not only are we at P4Capital dedicated to this space, we also understand the heavy impact that new legislation, new rules, new governing bodies have on the overall industry, and the complexity of big data coming onto the market from a global sense. So when we look at Chairman Volcker’s think tank recommendation, we understand the very many sides that he is speaking from. Not only from a centralized regulatory body, but the impact on big data, the impact on being able to do very fast high frequency trading, and be extremely competitive in the world.


 

That was the P4Capital team discussing the Volcker Recommendations, and the impact they could potentially have on banks. What to know more? Check out our website  and previous posts at www.planet4it.com or follow us @p4capital. Thanks and see you next time.

Don’t stress the stress test

In this week’s P4Capital discussion, the executive team talks about something most of us try to forget – the great recession of 2008.

The news isn’t bad though; for the first time since they were invoked, all American banks have passed the Stress Test.

The P4Capital team investigates what this means, and how it will protect the world economy should the worst come to pass again.

Stay tuned.

 

Transcript


Amanda: Do you remember the recession of 2008? When the banks all caused the world economy to crumble? When  jobs evaporated like shallow water and dollar values plummeted worldwide? Well, the banks certainly do, and to make sure the Great Recession doesn’t happen again, they introduced a series of stress tests. And for the first time, in 2015 all the American banks have passed.

Jim: This week’s topic is about the American banks passing stress tests, and the significance to not only the North American economy, but the global economy as well.

Jeremy: For those of you that don’t know what a stress test is, the top 30 or so US banks have all agreed to undergo stress testing, in which they will look at different factors and variables and examine how these would affect their capital reserves, and their ability to do business. So for example they might look at what would happen if unemployment was to rise by 2%, inflation were to rise by 3% and interest rates were to be cut by  .5%.

Archana: Just backtracking a bit here, the stress tests were essentially introduced after the financial meltdown of 2008, and it’s seen as a huge step in boosting consumer confidence in the US financial system.  In 2008, we all know how that story played out; the banks had to be bailed out, the government essentially funding about 700 billion to bail out the biggest lenders in the US.

Shaheerah: The whole purpose of these tests is to ensure that the banks will have enough capital, and they will be able to continue to lend to businesses and households even in a very dark economic recession. These stress tests focus on some important risks, and those risks are credit risk, market risk and liquidity risk.

Jim: The interesting part, now the US Greenback is soaring  out there and the banks that support the US dollar are now passed all the latest stress tests, is that it looks like the US economy is now back on extremely firm foundation and footing, and will be the engine that drives the global economy. We haven’t seen that in a while. The argument can be at least 7 years, some argue all the way back to 2000.

Jeremy: It’s actually the sixth year anniversary today of the low of the S&P 500. It’s up over 200% over the past six years, so it’s been one heck of a bull market.

Amanda: The date we are recording this is March 9, 2015 for our listeners who are tuning in at a later date. What does this mean for the Canadian economy?

Shaheerah: Yes, so now bringing that discussion back to Canada, Canadian banks are ranked the world’s soundest for seven straight years by the world economic form. Canadian banks are actually outperforming the US banks even in the midst of the dropping oil prices, and part of the reason is we have fewer regulations and less competition than the banks of the US. And both TD and BMO, among other banks are also expanding in the US because the US will see more economic growth than Canada over the next two years.

Jim: Therefore, expansion equals more jobs and more overall health to the Canadian economy which has in fact had a phenomenal bull run itself for almost a decade, with the exception of that mid, let’s call it September 2008 to September 2009 period, which is very good news indeed. The interesting part was the measurement of risk as well, and watching how the different financial institutions are now responding by getting rid of their archaic technologies and moving into faster engines which are allowing them to monitor risk with more clarity and make better decisions going forward.

Jeremy: Also, if banks in the US don’t pass their stress testd then sanctions can be placed on them such as what happened with Citibank. I believe it was last year they failed some of the stress tests so they weren’t able to have any share buybacks or authorize any dividend increases. They did pass them sufficiently enough so they didn’t have to cut dividends though. Not coincidently there is a new CEO implemented there.

Jim: Yeah, no kidding! How many of the competent Citi people fled to get to financial institutions that would pay them appropriate bonuses and how many should have got fired?

Jeremy: True. Goldman actually didn’t do as well as expected on these tests, so their share price was down 1.7% the day the tests were released, largely as investors are concerned that the similar sanctions may be in the future for Goldman Sachs.

Jim: Well, considering the US government is one of the largest borrowers on the planet, and they’re only going to borrow money from their financial institutions that pass their rules-

Jeremy: and China!

Jim: -And China, yeah! I think it’s very important that these FI’s that are on the line get up to speed.

Archana: Incidentally, this is apparently the first year since the Dodd-Frank act stress test, or as it’s called DFast,  that all the 31 US banks actually passed the test. Citigroup actually flunked the test last year and the CEO actually went on record saying that he is quite intent getting the books in order, or otherwise his job is on the line. And apparently they did well this year. Again, this DFast is apparently round one of the new stress test measures that the government has introduced. Part two is to be unveiled this week, which is primarily concerned with whether the Fed will announce whether the capital plans of these big banks are going to be accepted or rejected in terms of their share buyback and dividends. So it’s not exactly clear whether all 31 banks will go through – that remains to be seen.

Jim: Could be a lot of nervous executives wondering if they can get their bonuses paid or not!

 


That was the P4Capital team discussing the Stress Test, and how it will protect the economy going forward. Want to know more? Check out our website  and previous posts at www.planet4it.com or follow us @p4capital. Thanks and see you next time.

Hedge Funds: The Wild West

Welcome to the wild, wild west. Have you heard about the Canarsie Hedge fund? More money was lost in three weeks than most of us will see in our entire lifetimes. How did this happen and why? The P4Capital team examines this in this week’s Round Table Discussion.

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Robbing the Bank

Ever wonder how easy it would be to rob a bank? Well, it happened recently at RBC in Vancouver by two ex-employees of the company. Find out how they pulled it off in this week’s Round table discussion.

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The next industrial revolution – The Conclusion

This week, the P4Capital team continues it’s discussion into the Next Industrial Revolution.

Stay tuned.

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The next industrial revolution

The first industrial revolution saw the creation of many incredible technologies that changed the very face of the planet. Today, with the advent of 3D printing, globalization and manufacturing, we are beginning another one. How will this change the face of the planet in the 21st century?

The P4Capital executive team investigates.

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Which way will the markets blow in 2015?

What will 2015 bring for good or ill? It is a new year, and in this weeks discussion we sit down and try to predict which direction 2015 will bring for Capital Markets.

The P4Capital executive team investigates.

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Steal from the Rich and Give to the Poor — in stocks?

Welcome to 2015 everyone! We start this year off with stealing from the rich and giving to the poor. Well, not us per se – but a new app called Robin Hood.

The P4Capital executive team investigates.

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What did 2014 bring to the Digital world? P4Digital investigates

Happy New Year listeners and welcome to 2015! In honour of the new year, The P4Digital Executive team will be examining what 2014 brought to the Digital World, and what 2015 might change.

Stay tuned and enjoy

Transcript

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