Commercial Banking Career Ideas

Tellers are the face of retail banking, but there are many more careers in the field.
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The concept behind banking is deceptively simple. Take in deposits from people or businesses with excess funds. Lend the money to people who need funds. Pay the depositors less interest than what you charge the borrowers. Turn a profit on the "spread" between the rates on deposits and the rates on loans.

Of course practically speaking, banking is somewhat more complicated. One of the most important jobs in banking is that of a loan officer, who reviews applications for loans and decides whether to grant them and, if so, on what terms.

Large banks also devote considerable resources to credit analysis, developing predictive models and scoring systems to assess the risk that a particular borrower may default (that is, fail to pay back the loan). Therefore, people with strong quantitative backgrounds are normally in demand at major banks. For people orientated towards sales and client services, large banks also have relationship managers who meet the needs of their most important clients.

Commercial vs Personal Banking Operations

Commercial banking focuses on business clients, both as borrowers and depositors. Savings banks, on the other hand, focus almost exclusively on a clientele comprised of individuals, not businesses. However, over time, the lines have blurred somewhat. Major commercial banks typically will also have significant consumer (also known as retail) banking operations. The opposite, however, does not usually apply: savings banks tend to restrict themselves to servicing individuals.

Career Opportunities

In general, commercial banks, due to their large size, tend to offer more career opportunities, especially for entry-level employees.

Trends in Banking Branches: Trends in branch banking have large implications for employment opportunities, especially for bank tellers. The banking industry regularly goes through cycles of opening branches, followed by closing them, then by opening them again.

According to SNL Financial (as quoted in "HSBC to Scale Back Global Reach," The Wall Street Journal, 5/12/2011), total bank branches in the U.S. were:

  • 96,412 in 2002
  • 107,382 in 2009
  • 106,088 in 2010

However, a 2015 report by CNBC, quoting FDIC data, indicates that 2014 saw the largest number of branch closures in history, bringing total U.S. branches down to about 86,000. That said, it's worth noting that local market trends differ. In Manhattan, for example, major banks were still adding branches.

As the pendulum of banking branches swings back and forth, so does the pendulum of employment opportunities for branch staff, such as tellers and branch managers, as well as for back office staff that supports branch operations.

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