Reputation of the FRM in Europe

[emilioalzamora1]

Hi All,

I am very curious about your experience and understanding how the FRM is 'judged' by recruiters (and even practitioners) in Europe? Explicitly Europe, NOT the U.S. or Asia.

Sadly, from my experience I do come across many recruiters (even from very big agencies) who don't really know the FRM, nor its content and think it's a mainstream exam for 'everyone', much worse than the CFA.
Put differently, they don't see any value added if someone has the FRM credentials. This is simply shocking and somewhat utterly ridiculous! And part of it is owed to the fact that nowadays recruiters simply tick boxes (don't have degrees or awareness of the field/current industry standards and development - many of them have worked as a chef or whatever in their former life).

Why is this? Would be great if you share your experience and thoughts with all of us.

Many thanks!

 

[Dr. Jayanthi Sankaran]

Shocking indeed to say the least!

 

[Mkaim]

Hi All,

I am very curious about your experience and understanding how the FRM is 'judged' by recruiters (and even practitioners) in Europe? Explicitly Europe, NOT the U.S. or Asia.

Sadly, from my experience I do come across many recruiters (even from very big agencies) who don't really know the FRM, nor its content and think it's a mainstream exam for 'everyone', much worse than the CFA.
Put differently, they don't see any value added if someone has the FRM credentials. This is simply shocking and somewhat utterly ridiculous! And part of it is owed to the fact that nowadays recruiters simply tick boxes (don't have degrees or awareness of the field/current industry standards and development - many of them have worked as a chef or whatever in their former life).

Why is this? Would be great if you share your experience and thoughts with all of us.

Many thanks!

Hi @emilioalzamora1 ,

I'm from the U.S. but I thought I'd share my two cents. The fact of the matter is that the FRM designation is not well known at all within the finance community (but it's getting there). However, those who know about it value it much more than the CFA, and that's a fact. For example, I recently got an offer from a company because I had FRM next to my name. I'm a CFA level 3 candidate and a certified FRM; and when I mentioned to the hiring manager that I'm a certified FRM, the reply I received was "oh, that's much better". The hiring manager was also a certified FRM.

I totally agree with your recruiter comment. But here is the bottom line, unless you're dealing with an analytics based recruitment agency (usually quant recruiters), they're not going to know much about the FRM whether you're in the U.S., Europe, or Asia. But this is where you have to do a little bit of a sales pitch. There is nothing wrong with letting them know that the FRM is on par, if not more challenging, than the CFA and this is precisely what I did. I personally believe the FRM is much more difficult, but that's just me.

 

[brian.field]

I would also like to add the following:

IT IS UP TO US TO PROMOTE THE FRM!!!! @Mkaim is exactly right! Indeed, I think I will start saying, "Oh, That's much better!" whenever someone asks me to compare the FRM to the CFA!

 

[Mkaim]

I would also like to add the following:

IT IS UP TO US TO PROMOTE THE FRM!!!! @Mkaim is exactly right! Indeed, I think I will start saying, "Oh, That's much better!" whenever someone asks me to compare the FRM to the CFA!

#ohthatsmuchbetter! - one day trending on Twitter

 

[brian.field]

#ohthatsmuchbetter! - one day trending on Twitter

Fanstastic!!!

 

[seidu]

Great stuff guys!! thanks for the moral booster @Mkaim,FRM and @brian.field,FRM. I wish we will always have you around the forum for insight like this.
You make me feel more happy for opting for the FRM (Though is not well developed in Afrca as well, but we are moving there!)

Thanks
Seidu

 

[emilioalzamora1]

@Mkaim

thank you very much for your comment! Appreciate all your input and opinions, guys!

 

[pengfrm]

Hi everybody,

I am currently job hunting across Europe and during the process called up some of the HR departments to get more information about the risk related vacancies. I would say that HR people do not know too much about any kind of certification.

Comparison of hits per country (not representative):

CFA 76 vs 10 FRM
CFA 166 vs 37 FRM
CFA 36 vs 29 FRM - skewed because they use the term FRM also for fraud risk management.

Probably, the most efficient way to leverage the FRM is by going to the chapter meetings if there are any. Network, find out where the other FRMs work and apply there.

BTW: A little rant...for lots of the positions in a specific country, they are looking for somebody with a quantitative master/phd, experience, programming skills, FRM or PRM preferred, fluent English + native level of local language(s). I am wondering how big their applicant pool can be given that we were nine people who took the part II exam there (and yes, I was declined straight away for linguistic reasons or maybe they were just being nice - je ne sais pas )

 

[emilioalzamora1]

@pengfrm, which countries are you referring to here?

Across Europe the FRM is still not known a lot (and this won't change for the next years I am afraid) and what I hate most about all the job descriptions (across the globe) is the fact that if there is, for example, a vacancy purely related to risk then very often you will notice that the job requirement section (or nice-to-have section) says something like this:

It's regarded as a plus if you have the CFA or the FRM....

I mean if we are talking about a pure risk role what sort of value-added does the CFA bring? What role does a CFA play in a risk role? Barely anything!

This clearly shows that all these people compiling the jobs specs have simply no clue about the striking differences between CFA ('return designation' if we wanna call it like this in a CAPM risk-return framework) vs FRM ('risk designation' if we wanna call it like this in a CAPM risk-return framework)

 

[pengfrm]

Those were Germany, Belgium and Switzerland.

I am not an expert on the CFA but I suppose that when you apply for a pure risk role you have a quantitative background anyway and the CFA is just an extra on top that signals to others that you have a solid understanding of the financial markets as well.

Good luck with explaining the CAPM to HR folks I was interviewing at one of the Big 4 for a risk related role and asked the HR rep if there are any FRMs in the department - she did not know the answer.

 

[Longpips]

Got a call from a recruiter in Europe. theyre looking for Solvency II consultants with actuarial and /or FRM background (I am an actuary and an FRM). It looks like Solvency II (Basel II equivalent for insurance) is creating jobs for risk professionals there.

I checked FRM's most recent syllabus and it has "some" coverage of Solvency II, but not in depth - of course actuarial exams covers this in more depth.

Perhaps GARP should consider adding more depth to the Solvency II coverage in the exams, at least same as Basel II coverage? Pattern it after actuarial coverage perhaps?

There aren't enough actuaries to do the work, so perhaps FRMs can fill in the demand.

What do you guys think?

 

[emilioalzamora1]

I think the Solvency topic is rather a niche one which affects a minority of people on a daily basis. This is why GARP won't cover it; as you said it is a topic which will/should be covered in an actuarial exam and not in a more general program like the FRM. For sure you can always argue why a certain topic is not dealt with in more detail but in general I think the GARP syllabus is great except the 'Current issues' section which becomes outdated quite quickly and is of no real long-term value for exam takers (my two cents)

 

[merkamalu]

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[antogiar]

Few weeks before the exam I had a job interview for a Risk Manager position. I mentioned the FRM exam (though it was already specified on my CV that I am a candidate for FRM part 1) to the hiring manager (a conducting officer who supervises the risk management function). He told me these same words : "I don't give a sh** about your exam. Titles mean nothing to me." Several times...He got mad. I after this I was sure it's a big NO for me. But the sad thing is that, this person kept the same attitude during the entire interview: not being professional but mostly he LITERALLY HAD NO CLUE WHAT RISK MANAGEMENT IS. He asked me the traditional question about where I see myself in the next 5years. I emphasized my passion about risk management; that I will be always seeking knowledge and gaining expertise in this field and will be excelling at my role etc. Then I mentioned the new risks that arise -since risk management is a continuously evolving field- especially nowadays financial institutions are discussing the impact of climate risk. The guy interrupted me to tell me it is all bullshit, that I'd rather stop listening to random talks and focus on managing the real relevant risks. Then he asked me irrelevant questions thinking they are risk related (he asked if I perform AML/KYC checks on the underlying investors because he believes this is the way operational risk is managed). When I told him that the risk management sets outside the portfolio and acts as the 2nd line of defense as per the governance best practices, he said that in his company they are not lazy and don't have this mindset.
Anyway, I just felt I wasted my time and energy with such an ignorant person.
There is a real problem here about risk management culture in Luxembourg. At previous roles I heard that asking such questions (when I had to investigate operational risk loss/gain events) is not for my level, being a risk associate, but rather it's the management's role. There is a real lack of risk management and governance culture in many companies here.
I'd like to know how things are in other European countries? Because this ignorance makes me sick sometimes.

I sincerely think that you find the wrong person and company. Being a CO in Lux myself I know for experience ( I changed job recently) professional companies are asking for FRM or willingness to pass it and they are aware about the FRM. It seems that the position you were interviewed for was more Compliance / Investment compliance rather than Investment Risk and the person in front of you was a guy with a Legal and Compliance background. Keep looking for the right company and person to work for and with but please do not generalize only because you had a bad experience. Cheers

 

[Longpips]

I am US-based. However, I have worked for global consulting firms. They value FRM a lot. In fact, in one role, they required it, the job involved modeling and hedging derivatives. FRM was perfect.

At another job I had, it was in model governance. The requirement was either you have a PhD (Econ, Math Stat, etc) or a Masters PLUS FRM or CFA. So, again, FRM is valued highly.

I have interviewed for a job at a global consulting firm for a risk consultant role. The hiring manager didnt have an FRM or CFA. He had a MBA. During the interview I could sense he hated these exams (probably failed it). So, he didn't like people with FRM, totally biased against it.

So, what I have observed is some companies value it, some dont, and those who dont either were due to hiring manager not aware of it, or worse, failed it and hate FRM holders now.

Well, there are now 50,000+ FRMs globally and this will just keep growing. We are still in early stages (20 yrs), give it another 3-5 yrs and you'll see greater awareness and respect.

GARP should push for making FRM a regulatory requirement for risk jobs in banks and investment firms, similar to actuarial certification requirements for insurance companies.

Just my 2 cents.

 

[merkamalu]

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