Transitioning from academia to KBC
After 7 years in the academic world, PhD in Banking and Household Finance, Alvaro Gallegos decided to switch to the private sector. Excited to see how theory translates into practice, he is now applying his skills in the Risk Group of KBC.
What does your job entail, Alvaro?
I am a Risk Manager at KBC, focusing on Market Risk. I am involved with conducting risk assessments and ensuring regulatory compliance — activities which are intertwined. I mainly deal with the risks related to KBC’s financial derivative positions.
A financial derivative is an instrument that allows companies to hedge specific risks. Imagine, for example, a local manufacturer wishing to purchase equipment from the U.S. in a year’s time. The currency used in this transaction is the U.S. dollar, which has a varying exchange rate. To hedge against the risk of the exchange rate becoming less favourable, the manufacturer could ask KBC to secure the exchange rate, for example, at the current rate so it matches the planned budget.
KBC, of course, needs to hedge their own risks in that dynamic. It is in settings like this where my colleagues and I come in. We support the Front Office in monitoring and assessing risk exposures. We also report to management and regulators, such as the European Central Bank or the National Bank of Belgium, on risk performance and on compliance with all regulatory requirements.
You have an academic background; what made you switch to the private sector?
Making that switch with limited experience in the private sector is challenging. However, I was determined to find a job that allows me to see how theory is translated into practice and achieve tangible results. I started reaching out to acquaintances and friends who already worked in the private sector, seeking their advice. In this process, though, I noticed that some of the happiest amongst them worked at KBC. I doubled down on my efforts to land my current job, and luckily, the application went smoothly. The managers I met were friendly and open to getting to know me.
My research background is an asset in developing effective, sound, and efficient risk management tools, which is also an important aspect of my job. Although the topics I researched were different, the skills I developed have been very useful.
There are actually quite a few PhDs in KBC’s Risk Group, which is overall very diverse in terms of age, gender, nationality, and education. Some colleagues have a business or an economics background, but many studied statistics, maths, engineering, or computer science. As we are an international group, our working language is English, which allows me to continue to learn Dutch at my own pace.
What do you like about your job?
Besides loving my tasks, I appreciate the atmosphere in the team. In the academic world, there is hierarchy and tight competition among peers. That’s not the case here. Our focus is on teamwork and our main competition is with other financial institutions. The cultural organisation is horizontal, meaning all levels of management are approachable. That makes communication and collaboration very pleasant.
I will give you an example. The Board of Directors sets the risk appetite of KBC. How much risk is KBC willing to take? Even though risk managers don’t make that decision, we are encouraged to develop a view and understanding of KBC’s risk positions. Only then can we give good advice on when KBC’s activities match the set risk appetite, when they do not, and why. We are empowered to challenge things, and speak up.
Do you have any advice for others on how to make good career choices?
Take a step back and think about what makes you happy. What are you doing right now that you want to continue? What don’t you like? Talk to people and get guidance. Don’t be afraid to reach out to someone, even if you don’t know them yet. Usually, people want to help, and nothing bad happens even if they don’t.
