Credit risk analysts have become hot property in China this year, reflecting both the growing opportunities and hazards in the country's rapidly evolving financial markets.
Chinese state-owned banks had enjoyed a virtual monopoly on lending for decades, but the market has now been opened to new players who need specialists to price in risk as they go into a business fraught with uncertainties.
The economy faces a massive overhang of debt built up during a government-sanctioned credit binge to steer China out of the 2008/09 global financial crisis. Credit risk flared this year as the Chinese economy slowed and triggered landmark defaults, so more analysts are needed to parse that risk.
China recorded its first bond default in March, when Shanghai Chaori Solar Energy Science and Technology missed an interest payment. Importers also defaulted on US$300 million in soybean cargos as of April, and Evergrowing Bank defaulted on a 4 billion yuan (HK$5.1 billion) off-balance sheet credit product in September.
The scale of the risk is unclear as much of the financing derives from China's less-regulated shadow banking sector, the third largest in the world.
"People's perception about risk and attitude about risk is really changing," says Jin Wu, vice president at China Chengxin International Credit Rating. With high-profile defaults putting credit risk "front and centre", analysts are now in high demand, he adds.
Bank risk departments and credit rating agencies that meld fresh-faced university graduates into analysts face a horde of firms seeking to poach away their trained talent.
Headhunters and industry insiders say hiring is up by as much as 40 per cent for credit risk analysts, approval officers and operations staff.
The liberalisation of the financial sector has brought in more competitors to banks. Among them are peer-to-peer (P2P) lenders and guarantee companies, as well as established players in other fields, like asset managers and insurance companies.
State-owned banks with rigid pay structures are particularly vulnerable to poaching. One of China's top five banks has lost 20 to 30 per cent of its risk approval department in Shanghai in the past two years, a source inside the bank says. "The salaries here are too low. Many left for trust companies and asset management firms," the source says.
Pay rises for credit risk analysts are 20 to 30 per cent on average when changing jobs, with lower-level analysts commanding 50 per cent raises and smaller increases for senior positions, said Laura Yu, a manager at recruitment firm Robert Walters in Shanghai.
Job-hopping typically slows in the second half of the year because analysts hold out for Chinese New Year bonuses. But this year, hiring firms have been willing to buy out year-end bonuses, often equivalent to three to five months' salary, to bring in new recruits, says Erick Zhou, an associate director at recruiter Lloyd Morgan in Shanghai.
Nascent fields like P2P lending, which connects retail investors with those looking for loans, have experienced particularly explosive growth. "Some of the new financial institutions, they're doing really well - they receive consistent capital injections from private equity firms and venture capital firms," Zhou says. "So they're very aggressive in terms of hiring experienced credit analysts from banks and asset management firms."