White Paper Examines Mortgage Industry’s ‘Talent Crisis’

""Caldwell Partners"":http://www.caldwellpartners.com/ released a new white paper addressing what it believes is a crucial issue at a transitional time in the mortgage industry: the lack of knowledgeable leaders able to manage their business' new needs.

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""The mortgage banking industry stands at a turning point in terms of talent, and companies that don't recognize the world has changed will likely be left behind,"" said Carol Hartman, a partner in the Financial Services Practice at Caldwell and co-author of the white paper, named ""Developing a new generation of mortgage banking leaders.""

Hartman was joined in authoring the paper by Glen Korso of ""National Mortgage Insurance"":http://www.nationalmi.com/. In the paper, the two authors argue that the upcoming talent crisis stems from a more competitive financial services environment.

""Banks, hedge funds, private equity firms, law firms and accounting firms are all scrambling to find senior-level executives who can operate in a more regulated environment. In short, the mortgage banking industry is in danger of losing the recruiting battle, based on recent [COLUMN_BREAK]

experience in securing top-level talent for mortgage banks,"" the paper reads.

The issue's urgency is compounded ""because the founders of successful firms are in unfamiliar terrain and are uncertain about hiring executives who are generally more risk averse.""

One step to combating the problem, the authors say, is to increase compensation to compete with hedge funds, accounting firms, and other businesses. They also suggest aligning compensation to avoid functional conflicts of interest--for example, executives should be rewarded for reducing loan losses rather than increasing origination (which could conflict with the responsibilities of risk officers).

As of this moment, the paper notes five positions critical for any company: general counsels, CFOs, CROs, CCOs, and CIOs. Many firms may need to look outside the industry to fill those positions.

""[T]he industry has not been in a position to groom the next generation of leaders for a long time,"" the authors write. ""The shortage of existing leaders with the backgrounds and insights described will require the mortgage banking industry to seek executives from a broader population within financial services including banks, broker-dealers, regulators and institutional investors.

However companies fill those positions, they will need to do it quickly.

""Mortgage banking stands at a turning point. Institutions that recognize the industry's new dynamics can transform this challenge into an opportunity,"" the paper concludes.