Saturday 24 August 2019

Now is a good time to pursue a career in international financial services

The IFSC was a lucrative game-changer - but the game is changing again, and we've got to change to stay ahead. That's why IFS 2020 is a good start, says Jonathan Lowey

The IFSC was a lucrative game-changer — but the game is changing again, and we've got to change to stay ahead
The IFSC was a lucrative game-changer — but the game is changing again, and we've got to change to stay ahead

Jonathan Lowey

With the Government announcement that it plans to create over 10,000 new financial services jobs over the next five years, it's the right time to consider a career in Ireland's international financial services (IFS) sector.

As the current chair of the Federation of International Banks in Ireland (FIBI), I've had to engage with industry players, public sector and government bodies at national level - as well as key individuals at European policy and regulatory level. And what's clear is that Ireland's IFS is undergoing an enormous level of change.

The financial services industry in Ireland is now 30 years old. It has grown from less than 60 people employed in the International Financial Services Centre (IFSC) in the Dublin Docklands in 1987 to a truly national industry, providing work to some 35,000 people across the country.

One of the great advantages of the IFS sector is that it is not dependent on a country's economic performance or to a specific geographic region - as it is linked to the global economy. Consequently, employment in the sector has demonstrated considerable resilience.

Success has come as a result of Ireland's distinctive strengths, such as the availability of highly-skilled talent, a culture of innovation, tax competitiveness and a strong client focus. Its economic significance is reflected in its accounting for an estimated 12pc of the overall tax take.

When the IFSC started in the late 1980s, Ireland was a relatively low-cost location on the western periphery of Europe with a largely untapped pool of well-educated graduates. From these beginnings, the financial services industry was able to grow into one of the top 10 financial centres by 2009 according to Z/Yen's Global Financial Centres Index (GFCI).

While the financial crisis did have a significant impact on Ireland, as well as on the perception of Dublin as a financial centre, there are now strong indications that the country is on its way towards the top of the financial services charts again. Dublin has climbed 24 places in just one year and is now back firmly inside the top 50.

There's no room for complacency in this fast-moving sector and therefore IFS 2020 is a welcome development at a crucial time. This is the strategy launched by the Government earlier this year, setting out a five-year plan for the future growth of the international financial services sector. It follows last year's appointment of Simon Harris as Minister of State, with specific responsibility for international financial services - and he has demonstrated real drive and determination. IFS 2020 sets out a compendium of 30 actions that fall into five main categories:

1. Promote Ireland as a location for international financial services

2. Improve operating environment and competitiveness of Ireland's IFS sector

3. Drive research, innovation and entrepreneurship in IFS sector

4. Develop emerging IFS sub-sectors

5. Establish an implementation framework for IFS 2020.

The overall focus of the strategy is job creation, with an ambitious target of 10,000 net new jobs by the end of 2020. A key element of the strategy is education, as there is a direct relationship between the increase in the numbers at work and the pipeline of available talent.

Therefore the question for school leavers (and their parents) is what skills will lead towards a successful career in financial services?

Traditionally, as one might expect, the qualifications that do well in financial services are accountancy, law, economics and business studies. However, IFS 2020 is bringing together government departments with education providers and industry participants to ensure the country can stay ahead of the game as the industry develops into a new financial technology - fintech - age.

Disruptive developments and new competition from non-traditional financial services firms driven by ICT and big data are changing the industry landscape. These bring new challenges in the form of anti-money laundering monitoring, cyber security, data privacy and mobile technology.

It is imperative that Ireland is ready to support operations from at home and abroad that lead to value-creation and decision-making based in this country. These will be complemented by high-quality risk management professionals with strategic thinkers in key positions of responsibility, possessing skills in areas of technology, engineering, maths and statistics as well as in the more traditional areas already mentioned.

From big data, to crypto- currencies, to peer-to-peer lending, fintech innovations have captured the attention and imagination of customers, investors and the industry. It is not clear, however, what the nature and extent of the impact will be on the sector.

What is clear is that our IFS sector must appeal to a new generation of talent with a multidimensional and resourceful approach to challenges and opportunities. The international financial services sector is wide-ranging, with participants of all sizes from start-ups to the more established firms. JP Morgan, for example, has operations in Ireland that range from the traditional to the disruptive side of the financial sector. It is one of the largest custodians and providers of fund services with over $300bn in assets. It also has its European HQ of its payment services business in Ireland.

Chase Paymentech's payment-processing and merchant-acquiring business supports businesses of all sizes to process payments (including credit, debit, and digital, alternative and mobile payment options) in more than 130 currencies.

What differentiates Ireland as an attractive location is the availability of high-quality, well- educated, problem-solving staff. In the past, the relatively low cost of a talented pool of available staff gave birth to the IFSC - but the dynamic has changed. It's no longer possible to compete with so many low-cost locations with equally well-educated staff. Therefore, the new-look financial services industry in Ireland is evolving into a centre for risk analytics, compliance, governance, anti-money laundering services and innovation that involves IT skills. This calls for a wider range of disciplines and skills than ever before.

Working in an IFS company in Ireland gives people tremendous opportunities for mobility. JP Morgan is one of many international firms based here which has operations all over the world - and actively encourages mobility. For a rewarding career in an industry at a time of unprecedented change, Ireland's international financial services sector has much to offer.

Jonathan Lowey chairs the Federation of International Banks in Ireland, the principal voice of the international banking and financial services sector in Ireland

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