What they really think

Neil Smith, CA
Chief Operating Officer, Credit & Operational Risk Management
Deutsche Bank
London

Stage: Qualified CA
Trained with: KPMG
Degree: Business Studies
University: Robert Gordons

“As part of my degree I completed a one-year industrial placement with Mobil North Sea and it was there that my boss, who was a member of ICAS, offered me a piece of advice – ‘Do CA, it’s not only the best qualification but it delays making a career decision straight after university, and if your plans change then you’ve always got this qualification to fall back on, and it is a highly transferable skill’. Great advice! Training as a CA is an excellent way of experiencing different companies, different industries, and different cultures, as you complete your various assignments during the training contract. This gives you the chance to decide which sector and industry you ultimately want to work in, which is why I ended up in finance. I had excellent training with KPMG in Edinburgh, and as part of that experience worked extensively in finance, specifically the booming unit and investment trust business. By getting some exposure to the finance sector, I realised that it was definitely the area I eventually wanted to work in.

“Once I qualified I went to work at ICAS for two years as subject controller for Auditing, and then came down to London for about a year to set up the London training centre. Lecturing was great, I really enjoyed it. Trying to control a group of 20 highly motivated individuals certainly hones your presentation skills. You have to develop the ability to capture people’s attention and summarise complex technical information simply.

“After ICAS I went to work for a bank, but it wasn’t a huge success. I was only there for about four months, primarily because I didn’t really enjoy what I was doing, but it did give me a foothold into banking and I went on to work for Credit Suisse Financial Products. The job involved running the collateral management function. When you enter into a derivative transaction, the market value of this transaction will move up and down over the life of the trade - which can be up to 25 years. The controlling function valued the trade daily and it was my job to collect the collateral every day, and put it into a third party account. The interesting thing was that at the time it was a completely new function in all the investment banks, so everyone was just learning the ropes. It was a fantastic opportunity to be put in charge of something at the very beginning.

“The reason I got into banking was a combination of factors. Yes, it included the fact that I saw you could make lots of money, but it was also the fact that with global investment banks you get to travel around, so you’re not stuck in the office all day everyday.

“Being a CA was definitely the reason I got the job at Credit Suisse. You know they are looking for numerical ability, and being a CA means that you not only have a degree but have taken your studies to a higher level. It proves that you can pass exams, and that you are highly proficient with numbers. You also tend to find that CAs are everywhere, and therefore they tend to look for people who have similar qualifications.

“I stayed with Credit Suisse for about two years, during which time I also ran the European equities product control group for a while. The group’s job was primarily to ensure the daily P&L was as accurate as possible, untangle complex structured trades and also to check the inputs into the trade valuation models. The inputs into these models are complex but can be checked with market parameters and is a vital check and balance to ensure the profit is not being over or understated. Then after another period managing the collateral group again I joined Deutsche Bank (DB) in 1996, initially to set up the collateral management function within DB. After about a year I moved into risk, which is the job I do now, and I’ve been here for about the last eight years.

“When I joined DB they were building the investment bank, and I was given huge amounts of responsibility. You get more and more to do providing you keep delivering, so at a relatively young age you can find yourself responsible for huge numbers. The credit risk function within DB is responsible for managing hundreds of millions of Euros, and at the moment there are over 3,000 people within risk. Because DB is a global organisation I’ve had the opportunity to travel to all the major financial centres in Asia Pacific such as Singapore, Hong Kong, Tokyo and Sydney, as well as spending time in New York, and in Frankfurt where our head office is located. Recently I’ve also spent a lot of time in India because we’re outsourcing our credit research function to a vendor in Bangalore.

“I would have to say that the most memorable occasion in my career so far has been when DB bought Bankers Trust for approximately 10 billion dollars. I was sent over to New York for six months to help manage the integration of the two risk organisations and that was good for two reasons. Firstly, being in New York, and secondly for the experience. We had to merge two organisations together at less than the cost of both organisatiopns. These days there are so few large scale mergers happening, it was great to get the experience when I did it.

“The Risk organisation has become central to the bank’s efforts to increase profitability and our responsibility has increased to areas outside credit. DB is a fairly fast changing organisation and I really like working here. The good and bad thing about banking is that you never know what’s around the corner, that’s what makes it exciting, and for me that is what provides the job satisfaction.”