What Does an Investment Banker Do?
Investment bankers specialize in complex financial transactions for clients, from building financial models and conducting company research to producing pitch books. From beginning as analysts or associates they eventually progress into vice presidents or managing directors roles.
Career in finance involves adhering to stringent standards and precision; any mistakes could cost millions or billions in revenue and be highly competitive.
Education and Training
Investment bankers utilise their expertise and skills to assist companies with expanding by investing, borrowing or merging. Furthermore, investment bankers assist companies with capital raising by selling shares (also referred to as equity) or whole companies on the market.
Journeying towards becoming an investment banker involves extensive formal education and work experience. A strong background in business administration, finance, commerce or economics would be advantageous; those hoping to pursue this career path must be adept at working with numbers while being capable of crafting compelling financial arguments.
Gaining employment as an investment banker can be extremely competitive, and multiple applications may be necessary before finding success. Many investment banks provide internships to undergraduate and graduate students looking for work experience; those able to secure these will find that their chances of employment increase significantly. It is vitally important that your resume remains up-to-date, listing any additional qualifications which might help set you apart from other candidates.
Getting a Job
Investment banking can be an extremely arduous job, and only those most dedicated candidates will succeed. One way to increase your chances is to attend a university approved by relevant bodies as this will provide you with a degree that banks will accept.
As well, it is also essential that you network effectively and build relationships with those working in your industry. Making connections can give you an edge when applying for internships or graduate jobs.
Investment bankers typically gain experience through summer internships, typically at analyst level for undergraduate students and associate level for graduates studying for an MBA. Such internships provide a good introduction to the industry while offering you the chance to make contacts in your desired field of specialism – and successful ones may even lead to job offers!
Advancing Your Career
Investment bankers typically charge fees based on the value of transactions they manage (whether it’s selling a business or raising capital) that fall under their responsibility. They conduct research on financial information and market trends; assist with mergers and acquisitions, manage private equity settlements and help clients cope with periods of financial distress.
At one time, entry to an investment bank was highly selective. Successful applicants often came from top universities with strong alumni networks. Furthermore, their academic records included impressive test scores and GPAs.
Now, with increased competition for positions, banks have become less restrictive when selecting candidates and are offering roles to a wider variety of individuals. Candidates who demonstrate exceptional performance, networking skills and leadership experience may quickly progress into associate status after two years and ultimately vice presidency roles; other opportunities could exist in private equity funds or corporate development as well.
Investment bankers who are just starting their careers work long hours and often face intense pressure, creating an exhausting yet highly rewarding and lucrative environment.
Investment bankers spend much of their time away from the office meeting with clients, banks, insurance agencies and fellow investment bankers – meetings which may include clients, banks, insurance agencies or fellow investment bankers.
Travel is part of their job description; working across time zones may be required in order to accommodate clients in various regions. You should expect to work weekends and holidays as well as long days and nights on an ongoing basis.
Entry-level investment bankers typically start off their careers with an estimated starting salary of about $150,000, rising steadily after three years to around $290,000. Analyst compensation will reach approximately $290,000. After four years as an associate you could reach $470,000; once promoted as director this could exceed $1.1 Million! It should be noted that these figures can vary widely depending on which banking firm your job takes you with.