HKMA's Roadmap to Effective Talent Management in Banks

The latest HKMA circular provides guidance to assist Authorized Institutions' (AIs) assess, maintain, and enhance the competence levels of their workforce and address talent shortages - which is a proactive step to drive the up-skilling and re-skilling of banking professionals.  

To assess talent development practices, the HKMA conducted a targeted review of major retail banks. During this review, the HKMA observed various practices that had well-defined expectations in four crucial areas.

• Manpower planning: AIs should have a clear and robust process to map out manpower planning that corresponds to their business plans, and put in place effective action plans with measurable targets to fill any talent gaps. The Board of Directors (the Board) should set a clear direction for manpower development to support business priorities. HKMA expects the business development activities of AIs to be supported by:
  
  
  • sufficient manpower in terms of headcount and skill-sets; and 
  • adequate financial resources for training their staff and nurturing prospective practitioners.
    
    
• Up-skilling the workforce: AIs are expected to put in place policies and procedures to monitor staff competence, and appropriate arrangements to equip their staff with up-to-date skills and knowledge that can help them keep pace with the ongoing changes in the industry and fulfill their duties and responsibilities properly in their existing job roles.
  
  AIs should determine the up-skilling needs of their staff at regular intervals and provide suitable and timely trainings for them. The up-skilling needs should cover both qualitative (e.g. training scope) and quantitative (e.g. minimum training hours per year) considerations.  AIs should also promote a conducive learning environment and culture to motivate and facilitate their staff in enhancing their competence levels.
  
  
• Re-skilling the workforce: AIs need to develop a comprehensive and forward-looking plan for re-skilling that includes effective strategies to enable employees to acquire new skills and knowledge related to emerging job roles. This plan should take into account the valuable experience gained from their previous roles. It is important to establish measurable targets within the re-skilling plan, which should be approved by the Board. AIs should also differentiate between routine job rotations and re-skilling requirements caused by technological or business changes. These changes may render an employee's existing skills outdated in the near to medium term, prompting the employee to transition into a different functional area.
  
  
• Recruiting talent: AIs to devote efforts to expanding the overall talent pool for the banking sector by attracting and better equipping prospective industry practitioners, rather than poaching existing practitioners from other AIs to satisfy their own talent needs.

Some positive practices observed in AIs are: 

• AIs offer complete funding in advance for relevant training programmes.
• AIs regularly arrange town hall meetings and sharing sessions to promote a mindset of growth and cultivate a positive learning environment in the organisation.
• AIs have introduced specialised programmes for interested employees to discover new development opportunities and gain practical experience through project assignments, short-term attachments, secondments, and job shadowing.
• AIs have incorporated ECF professional qualifications as one of the evaluation criteria in their job postings.

The proper execution of talent management plays a crucial role in advancing both AI and the industry as a whole - our regulatory body has articulated this with great clarity.

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