Why Culture is Crucial for Building a Challenger Bank

Written by EO Executives on Oct 25, 2018

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For the last seven years, EO Executives has worked with many Challenger Banks of all sizes to provide Executive hires.

Since the opening of Metro Bank in 2010 (The first high-street bank to be granted a licence for over 150 years) there have been several new in entrants in the challenger banking space, as well as many others who are currently going through business planning, licencing and funding. This has been partly due to government initiatives (such as open API legislation and PSD2) and the explosion of Fintech, due to the emergence of new technologies such as block-chain and data analytics tools. 

EO is a leading provider of high-level managers and executives for senior roles within Challenger Banking and Fintech. Historically we have worked with a number of established retail banks to source the talent they need, but more recently we have been working with an increasing number of Challenger Banks and SME's that are looking for experienced individuals who can adapt to the fast- paced and agile world, whilst offering a high level of knowledge. 

What makes a ‘Challenger Bank’ different to any other bank?

A Challenger Bank is a relatively small retail bank set up with the intention of competing for business with large, long-established national banks. (Oxford Dictionaries). Therefore, in comparison to the larger/well established banks, as it stands in 2018, most Challenger Banks will be newly found and in the process of building their footprint, launching into the competitive market and working to build their brand.

With the banking industry being so competitive and hard to break into, the new Challenger Banks are having to offer services beyond the traditional model. If we take ‘Metro Bank’ for example, who are offering customers banking services 7 days a week (typically unheard of in the traditional banking world) they need to have ‘an edge’ to steer customers away from the more established banks. Yet, this is what makes the Challengers so interesting and unique in such a busy market. They are offering customers something different and refreshing.

However, although each Challenger Bank has unique offerings, ranging from small start-ups at funding stage, to those with a banking license and high growth, they have one thing in common- and that is they all thrive off a strong start-up culture.  

What does this mean for the internal requirements of the Challenger Banks?

Challenger Banks are typically founded by ‘High-Network Individuals’ or are Private Equity/ Venture Capital backed. Many of the successful players are growing at an astronomical pace, but this has not come without years of hard work and execution. These individuals will have a ‘start-up’ work mentality and know what it takes to even stand a chance of competing with their competitors.

This reflects on the types of employees the Challenger Banks need in their teams to take their ideas to the next level. Every Executive, be it a Chief Operations Officer; Chief Risk Office or Head of Retail Banking, will need to have the right mind set and cultural alignment to succeed in a Challenger Banking environment.

At EO Executives, when we partner with Challenger/ Retail Banks to source top candidates we know to look for candidates with not only the right qualifications, but also who are highly driven, work at an efficient pace and understand the work it will take to make a new bank a success.

What do Challenger Banks want from their employees?

Our clients always tell us there are two requirements for their employees;

  • High calibre individuals with a proven track record of success in their specialism.
  • The right cultural fit.

What does ‘cultural fit’ mean?

Each business will have its own culture and will have different ideas of what individuals will do well in their teams. Challenger Banks are no different. Especially given the ‘start-up’ culture of a Challenger Bank, owners are often looking for candidates with the following traits;

  • Unphased by continual change- no day is the same in a Challenger/ Retail Bank.
  • They may have worked in a large banking and led a team of approximately 100+ employees but now have a team of one (there in no one to delegate to).
  • They have a practical and pragmatic approach to work.
  • They are adaptable to different situations.
  • Energetic with the gravitas to work at a demanding pace.
  • Can address multiple challengers and see solutions to challenges. 

Leaders in Challenger Banks requirements could typically align with Business Executive and Author Jack Welch’s ‘Four E’s’;

  • Energy in approach to work.
  • Energise and motivate the team.
  • Edge- can make difficult and pragmatic decisions.
  • Execute and deliver on key deliverables.

It is important to remember that your people are the driving force in your business. So, if you are a Private Equity business, HNW investor or CEO looking for guidance on how to place the right level of individuals into your business, please get in contact on 01962 893300 for a confidential discussion.

In the meantime why not download our recent whitepaper; Challenging Times- Challengers on the High-Street.

To uncover the challenges and tremendous journeys these banks have been on, we interviewed some of the leading industry experts. In our 'Challenging Times- Challengers on the High-Street'  whitepaper, these experts provide insights into the highs and lows of running a challenger bank, along with their predictions on what the future holds for the economy and financial services. 

Click on the image below to download your personal copy.

Challenging Times- Challenger on the High Street

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