the guide to find a job in the financial sector
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2012
Edition
The graduate guide to fnding
work in the fnancial sector
Careers in
Financial Markets
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Our
to responsiblecommitment
growth
CRDIT AGRICOLE CORPORATE & INVESTMENT BANK
Crdit Agricole CIB is the Corporate and Investment Banking arm
of the Crdit Agricole Group.
Crdit Agricole CIB was the first French bank to adhere to the Equator Principles in 2003, whichhave since become the standard for responsible project finance. Since 1997, the Bank has beenstrongly committed to financing renewable energy and is a leading player in the sector. For the Bank,being responsible means providing our clients with products and services that contribute tomeeting social objectives.
When it comes to Corporate Social Responsibility, there is no better partner for clients than
Crdit Agricole CIB.
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WELCOME
Welcome to the 2012 edition of Careers in Financial Markets,
from eFinancialCareers.com. By picking up this guide, youve
taken the rst step towards gaining an edge as you strive for
a career in nancial services and youll denitely need one.
Investment banking is one of the most competitive industries you
could choose to enter. Last year, for every vacancy at investment
banks or fund managers, there were more than 230 applications, while
nancial services companies received more than 70 for every open job,
according to the Association of Graduate Recruiters.
We hope that this guide, now into its 11th edition, will help get you
started. Careers in Financial Markets is a global publication and it offers
tips on how to make it through the application process in Europe,
Middle East and Africa (EMEA), North America and Asia-Pacic.
In the rst part we cover application forms, CVs, interviews and
assessment centres, including exclusive insights from banks graduate
resourcing teams and recruitment experts in the nancial industry.
Then we look at the job roles in investment banking, from front-ofce
positions to operational functions. We then move on to careers elsewhere
in nancial services, including hedge funds, private
equity, accounting and IT in nance.
All the articles feature contributions from
industry insiders, and use the US dollar
(denoted simply as $) as the default
currency for pay and revenue gures.
This guide is designed to be used in
conjunction with the Student tab on
eFinancialCareers.com. The website
features news and regularly updated
advice on how to stay ahead
of the competition.
Careers in
Financial Markets
GETTING IN
A GLOBAL INDUSTRY 2
A LOCAL START 4
GLOBAL RECRUITMENT
TIMELINES 6
CVS, COVER LETTERS & APPS 10
THE S.T.A.R.
INTERVIEW TECHNIQUE 11
FRONT-OFFICE INTERVIEWS 12
GRADUATE RECRUITER Q&A 16
TESTING, TESTING 20
THE FAMOUS FIVE 22
DIVERSITY CHALLENGE 23
INVESTMENT BANKING
MERGERS & ACQUISITIONS 24
CAPITAL MARKETS 28
SALES, TRADING & RESEARCH 32
ELECTRONIC TRADING36
COMPLIANCE &
RISK MANAGEMENT 38
OPERATIONS 42
FINANCIAL SERVICES
FUND MANAGEMENT &
INVESTMENT CONSULTING 44
ALTERNATIVE INVESTMENTS 48
GLOBAL CUSTODY 50
WEALTH MANAGEMENT 52
INTERDEALER BROKING 56
CORPORATE BANKING 58
DATA PROVIDERS
& RATING AGENCIES 62
IT IN FINANCE 64
INSURANCE 68
ACCOUNTING 70
EMPLOYERS
COMPANY PROFILES 72
Careers in Financial Markets 2012
is published by eFinancialCareers Ltd www.efnancialcareers.com
Project Manager: Janice Chalmers
Designer: Valerio Italiano
Editor, eFinancialCareers.com: Sarah Butcher
Editor, Careers in Financial Markets: Paul Clarke
Contributors:AP Simon Mortlock, Shree Ann Mathavan; EMEA Nicole Degli Innocenti;US Fred Yager, Scott Krady, Myra Thomas, Janet Aschkenasy
Sub-editors: Sue Balding, Annabella Gabb
2011 eFinancialCareers Ltd
No part of this publication may be reproduced without permission.
Paul Clarke
Editor, Careers in
Financial Markets
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The diversity of roles within the nancial sector is matched
only by the wide range of expertise in countries across
the globe. We examine the key strengths of each region.
Europe, Middle East & Africa (EMEA)Its easy to see why, despite recent wobbles, London remains the
top global nancial centre. It has the largest slice of the biggest
nancial pie in the world: London accounted for 36.7% of the
average $4 trillion traded daily on the foreign exchange markets.
London also has a 45.8% share of the $1.2 trillion traded daily on
the over the counter (OTC) derivatives market, and the London
Metal Exchange accounts for 90% of all non-ferrous metals
traded in the commodities sector.
Both Zurich and Geneva are in the top 10 of global nancial
centres, primarily because of large commodities and wealth
management sectors. Switzerland has $6 trillion in assets within
wealth management, and is number one for trading numerous
physical commodities.
France is Europes largest fund management hub, with $3.7
trillion in assets under management (AUM). Germany has the
Continents biggest debt capital markets sector $378.5bn
worth of deals were completed in 2010 and a sizable fund
management industry, with $2.6 trillion in AUM.
Ireland and Luxembourg are major centres for global custody,
administering assets of $2.7 trillion and $3.2 trillion respectively.
Scotland is gaining a reputation for investment banking operations
expertise, and the Middle East has numerous large sovereign
wealth funds, and is attracting more global private banks.
The Nordic region and the Netherlands are big institutional
investors, while Belgium is home to post-trade services rm
Euroclear, which clears $721 trillion of securities annually.
United States and CanadaWall Street has long been a magnet for nancial professionals
but the United States and Canada are also home to six of the
worlds top 20 nancial hubs: New York, Chicago, Toronto,Boston, San Francisco and Washington DC. The US leads
the world in debt capital markets, with more than $2.5 trillion
worth of deals in 2010. There were also $913bn of mergers and
acquisitions (M&A) and $210.5bn of equity capital market deals
last year.
Although New York remains the nancial epicentre of North
America, the migration of nancial jobs to other cities such
as Seattle and Salt Lake City continues unabated.
Wall Street today is more a state of mind than a location, since
most nancial sector rms have moved elsewhere and it is no
longer necessary to work in New York to have a nancial career.
Chicago is one of the worlds leading centres for commodities
A GLOBAL INDUSTRY
A birds eye view o each global fnancialcentre and its individual strengths
Rio
Boston
Stamford
Salt Lake City
Raleigh-Cary
New York
Toronto
Chicago
2 Careers in Financial Markets 2012 efnancialcareers.com/students
The worlds financialhubs at a glance
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and for the $600 trillion OTC derivatives market, while Boston
is known for its fund management rms such as Fidelity and
State Street, which together account for $3.7 trillion of the
total $13.4 trillion the US has in AUM.
Elsewhere, Connecticut has become synonymous with hedge
funds, while nancial giants such as Schwab and Wells Fargo
are headquartered in San Francisco.
Asia-Pacific
Asias key banking cities, supported by economic growth in
China and India, have rebounded quickly from the crisis, andnancial institutions are expanding across the region. Hong
Kong, Singapore, Tokyo, Shanghai and Sydney are all top 10
global nancial centres.
The wealth held by high-net-worth individuals in Asia-Pacic
rose 30.9% to $9.7 trillion between 2008 and 2009, helping
Singapore cement its strong position in global private banking.
The country is an operations and IT centre for several
investment banks.
It is also Asias top energy trading hub and increasingly a
location of choice for other commodities, including agricultural
products, metals and minerals.
Singapore fund managers looked after a record $1.1 trillion in
assets in 2010, representing a rise of 13% on the year before
but still no match for Hong Kongs $1.6 trillion in AUM.
One of Hong Kongs main strengths is its securities market.
Funds raised by initial public offerings (IPOs) hit a record high of
$57.1bn on the Hong Kong Stock Exchange in 2010.
Despite Japans recent natural disasters, Tokyo remains one
of the worlds top nancial centres. It is Asias main foreign
exchange market and has the largest asset management
industry in the region.Although Shanghai, Beijing and Shenzhen cannot yet match the
product sophistication of more mature centres, China is exing
its nancial muscles in terms of equity capital markets volume,
ranking second globally in the second quarter of 2011.
Australias nancial sector has a comparatively domestic focus
and is dominated by its Big Four commercial banks. Within
investment banking, the booming resources sector is driving
M&A and capital markets activity.
GETTING IN
Edinburgh ParisLondon Frankfurt
Switzerland
Mumbai
Moscow
Shanghai
CapitalMarkets
Commodities
Derivatives
FundManagement
FX
Hedge Funds
M&A
Operations
PrivateBanking
Hong Kong
Tokyo
Singapore Sydney
Financial
Centres
1. London2. New York3. Hong Kong4. Singapore5. Tokyo5. Shanghai7. Chicago8. Zurich
9. Geneva10. Sydney10. TorontoSource: Z/Yen Global Financial
Centres Index 2011.
efnancialcareers.com/students Careers in Financial Markets 2012 3
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4 Careers in Financial Markets 2012 efnancialcareers.com/students
Banks value the diversity of an international workforce but
securing a graduate place in a foreign location is not as
simple as it once was.
EMEA
Most investment banks base the vast majority of their
European graduate trainees in London, but new UK immigration
restrictions are causing a headache when it comes to recruiting
students from outside the European Union (EU).
Traditionally, non-EU students have been able to arrange their
own tier one post-study work visas that granted permission to
work in the UK for two years after graduating without the need for
a sponsor employer. But the government has announced plans
to close this route from April 2012. At present it is unclear if the
closure will denitely go ahead or what will replace it if it does.
Instead, non-EU graduates who wish to be recruited via the
UK are advised to look to tier two restricted visas, available to
those who have been offered a (skilled) job. This means you
need a job offer rst.
The good news is that the bank generally does the paperwork
for these once theyve decided to appoint you. The bad news
is that there are currently only 20,700 of these available to all
UK companies. Worse still, these are released on a monthly
quota basis and, with most banks tending to apply for their
graduate visas in June and July, this reduces their share of
the 20,700 still further.
Perhaps surprisingly, despite the gloomy outlook and
administrative burden, most banks insist that theyre
maintaining the number of foreign students they employ.
US
It has been a difcult couple of years for those from outside
the US who are looking for a nancial services job opportunity.
A lull in the job market has meant foreign-born professionals,
who need H1-B visa sponsorship, face an uphill struggle.H1-B visa numbers are set by U.S. Citizenship and
Immigration Services and have remained at for some
time, at 65,000 annually.
Wendy Tsung, associate dean and executive director of MBA
Career Services for Emory Universitys Goizueta Business
School, says foreign-born students have found jobs in nance
hard to get in the US.
Firms are less likely to sponsor someone when theyre unsure
they will be able to stay, says Tsung. The price of the visa
isnt overly burdensome but the training costs and the cost of
getting someone up and running in a position is a big factor.
H1-B visas generally last for up to six years. After that, foreign-
born workers must start the process anew or seek permanent
residency status.
Asia-Pacific
A growing number of graduates want to work in Asia because
they want to be based in a region of high economic growth.
However, banks demand a genuine knowledge of Asia,
without which opportunities for foreigners are limited because
employers have a large local talent pool from which to choose.
Any foreign national with aspirations to work in Hong Kong or
Singapore needs the support of their employer, who then sends
a visa request to the Ministry of Manpower in Singapore or the
Immigration Department in Hong Kong.
Foreign nationals who have attended university in Asia have an
advantage over those coming straight from institutions in other
parts of the world. Fluency in Mandarin is helpful, especially
in Hong Kong where most rms are increasing their focus on
mainland China.
Completing a local internship will also boost your chances of
securing a graduate place because you wil l have demonstrated
a commitment to the region and the employer. But getting an
internship in the rst place can be problematic, because some
banks are less willing to consider non-local applications for
short-term roles.
If you are studying outside Asia and havent done an Asian
internship, consider visiting in the summer before you graduate
to network and become a known entity.Investment banks in Australia, which tend to have a smaller
number of entry-level vacancies, generally ll their intake
with local graduates.
A LOCAL START
Te hurdles you have toovercome as a foreign graduate
Firms are less likely tosponsor someone whentheyre unsure they willbe able to stay.
WENDY TSUNG
Associate dean and executive director, MBAcareer services, Emory Universitys Goizueta
Business School
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Working to improve the future.
Join the EIB
The EIB, as the Bank of the European Union, is dedicated to improving the
future of peoples lives in Europe and around the world. It achieves its goals
thanks to a diverse and highly qualified workforce, motivated to supportthe financing of sound investment projects that deliver tangible results.
Join the European Investment Bank
www.eib.org/jobs
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EMEA
Deadlines Most full-time graduate programmes close
between late October and mid-November, although some
banks recruit into early December. Certain divisions, notably
technology, operations and nance, have extended the
recruitment process into the new year. Summer internship
deadlines close in mid-January.
Application form or CVIncreasingly, banks are favouring
CVs because of the volume of applications they receive. For
more tips and guidance, see CVs, Cover Letters & Apps on
page 10.
Interviews The majority of banks recruit on a rolling basis so
interviews will take place from September, when applications
open. You should nd out whether you have made it to the rst
round of interviews within one to four weeks, depending on the
volume of applications, with the actual interviews taking place
a couple of weeks after. The rst round of interviews is usually
with human resources (HR) and/or representatives of
the division youre applying to, and consists of a rst round of
competency-based interviews and a possible presentation or
case study. If you are successful, banks aim to inform you
24 to 48 hours afterwards, with the aim of staging the second
round one or two weeks later.
The second round is also sometimes the assessment centre
(see Testing, Testing on page 20) and will generally consist of
more competency-based and technical interviews, a group
exercise, psychometric tests and a networking event.
Target schools Most banks target a restricted number of
universities in each country. In the UK, think Oxbridge, LSE,
Imperial and UCL; in the eurozone, think HEC, Essec, Paris
Dauphine, WHU, EBS, SDA Bocconi and Universit degli Studi
di Genova, to name a few.
GLOBAL RECRUITMENT
TIMELINES
What to expect fom the recruitment processin EMEA, the US and Asia-Pacic
I graduated in May 2010, then pursued an
internship during the summer. In October I
sent my CV, covering letter and completed
application form to Socit Gnrale (SocGen).
The form consisted of a series of competency
questions and also asked why I wanted to work
in banking in general and SocGen in particular.
Less than two weeks later I had an
invitation to complete numerical tests
online, for which I practised on other
tests I found on the internet. A week
later I was asked to do a telephone
interview, during which I was asked
about my previous experience and my
leadership and team working skills.
Two weeks later I was invited to attend an
assessment centre. That day I had three
interviews, more numerical tests and a group
exercise.
I received my offer of a job a few days after the
assessment, in mid-December, and I started
my job in February. It was quicker than usual
because I had already graduated and was
available immediately.
MichelangeloVitiello
M&A Analyst, Coverageand investment banking,
Socit Gnrale CIB
I received my offer ofa job a few days afterthe assessment, in
mid-December, andI started my job inFebruary.
6 Careers in Financial Markets 2012 efnancialcareers.com/students
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W E B R I N G O U T T H E B E S T
I N E V E R Y O N E T O B U I L D
T H E B E S T P O S S I B L E T E A M
TO VIEW OUR CURRENT JOB OFFERS,PLEASE VISIT CAREERS.SOCIETEGENERALE.COM
Theres no team success without indiv idual success, and no company progress without personal development.Thats why Socit Gnrale of fers a l l i ts employees career prospects that are deeply fu l f i l l ing and rewarding.
With more than 157, 000 employees from more than 120 di f ferent national i t ies working in 85 countr ies, we respectthe diverse range of ta lents avai lable. And with 3.5 mi l l ion hours of tra in ing provided per year, we also respect
and develop the qual i t ies of each indiv idual . Thats team spir i t too.
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US
Deadlines Assuming you submit your application online
rather than apply through a target university, the deadline is
towards the end of September or beginning of October for
full-time positions. For internship recruitment, the deadlines
run from mid to late January.
Application form or CVBoth. Some banks will accept
resumes from students while on campus; others require
students to submit them electronically or ll in an online
application form. They are reviewed in January and, if youre
attending a university on the campus recruitment circuit, banks
will inform you and allow you to sign up for interviews a week
before their visit.
Interviews Expect two rounds of interviews. You will meet
numerous people during this time, with the rst taking place
in early February. The nal rounds of interviews will take place
about one or two weeks later. Some banks take this process a
step further. For instance, Bank of America Merrill Lynch runs a
series of super days, during which candidates are interviewed
in New York over a single day.
Target schools Denitely. A lot of banks ll many business
areas through their on-campus recruitment programmes, which
normally target a core of 30 universities. These include Wharton,
Dartmouth, NYU, and Columbia.
Asia-Pacific
Deadlines In Singapore and Hong Kong, application deadlines
are similar to Europe: October or November for graduate schemesand November to January for internships. Australia follows a
different calendar, with most banks closing full-time graduate
programmes in March or April and internships in July or August.
Application form or CVMost banks in Asia-Pacic
request a combination of application form and CV. The former
extracts standard information about an applicant, and ensures
that all candidates answer the same questions. CVs offer
an opportunity for students to highlight information that the
application form has missed.
Interviews You should nd out whether you have an
interview within a month of sending your application, and
you will typically be given up to two weeks notice before the
interview takes place. Depending on the bank, rst-round
interviewees face a grilling from human resources and/or
representatives of the division they have applied to. Waiting
times for the next stage depend on when you were initially
interviewed, but it is best to prepare for a quick turnaround of
just a week or two.
The second round may consist of a competency-based
interview, case-study presentation, group exercise,
networking event, and sometimes a psychometric test. This is
similar to the assessment centre approach used by banks in
other locations.
Target schools Banks in Asia-Pacic actively target
returnees from leading universities in the US and Europe.
Closer to home, they like graduates of colleges such
as The National University of Singapore, Singapore
Management University, The University of Hong Kong, City
University of Hong Kong and The Chinese University of
Hong Kong.
In Australia, some of the preferred institutions are: The
University of Sydney, The University of New South Wales,The University of Melbourne, Monash University, The University
of Queensland, The University of Western Australia and The
University of Adelaide.
GETTING IN
I joined a business fraternity, Beta Alpha
Psi (BAP), in my junior year at university.
This helped a lot, because it introduced me to
alumni in the fnancial sector and I also learned
about the responsibilities of an i-banking analyst.
When the recruitment process kicked off,
I studied investment banking guides to capitalise
on my knowledge gained through the BAP
programme. I also relied on the alumni
to help me with the more technical and
behavioural questions.
Expect some tough brainteasers such
as, Who would have a higher beta a
supermarket chain or a biotech company?. The
hardest part, though, was the stress interviews
designed to take you out of your comfort zone.
You need to remain calm throughout.
Id advise others to start early and stay optimistic.
When I was going through the interview process, I
had a buddy who interviewed for consulting jobs.
By motivating and supporting each other, it was a
much easier process.
Joe Ma
Graduate analyst, M&A,Morgan Stanley Hong
Kong
The hardest part wasthe stress interviewsdesigned to take youout of your comfortzone.
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In recent years more banks have started to ask students
to submit a CV in place of (or sometimes as well as)
an application form. Here, three graduate recruitment
professionals offer advice on how to approach the written
application.
CVsLength Ideally one page, but never more than two.
Contact details Put your name in a bigger font at the top
(in the page header) to help it stand out, and your contact
details underneath in a smaller font.
Email address Dont try to be clever with your email address
boywonder2011@hotmail.com will make a bad impression.
Education Make sure this section is on the rst page, and
put your educational qualications in reverse chronological
order, i.e. most recent rst.
Dates Dont put the dates on the left the readers eye will
fall on the left-hand side rst when skimreading; instead, put the
qualication or job title (i.e. what youve actually done/achieved)
on the left, the uni where you studied, and then the date, so
BA Business & Law, Imperial College London, Sep 08 Jun 11.
Achievements This is the new trend with CVs, replacing the
emphasis on skills. The idea is not just to list your duties for
every job that you did, but also to describe what you achieved,
rst for your employer by way of business results, and second
for yourself in terms of skills and development.
Hobbies / Extracurricular activities Keep them relevant,
i.e. loaded with employability skills such as leadership,
teamwork, initiative. If youve climbed Mount Everest, this shows
planning, grit and stamina. If youve set up an investment club
at university, this demonstrates an early interest in nance.
ApplicationsNo shortcuts We often come across applications with
answers that have been cut and pasted, and candidates
sometimes even forget to change the name of the bank theyhave applied to, which doesnt reect well, says Natalia
Garland, head of global graduate marketing and infrastructure
at BNP Paribas.
Use of space Fill it. Try to use up the wordcount allowed for
each answer answers that are too short can make it look like
you havent really taken great care or time over the application.
But of course, it also depends on what you put in the space.
Be sensible, advises Linda Jackson, MD of consultants
Fairplace. Do not devote more space to your victory on the
pitch than to your summer working for a big bank, because it
will send the wrong message about your priorities.
Questions to expect There will probably be a question
on your motivation(s) for breaking into the industry, and for
applying to a particular division or bank, along with questions
on your industry knowledge. Then there are the inescapable
competency questions, for which you should use the S.T.A.R.
formula to frame your answers (see opposite).
Cover lettersTheir purpose People underestimate the importance of a
cover letter, says Sarah Harper, head of recruiting, EMEA and
India at Goldman Sachs. It is a useful mechanism to show
your enthusiasm for the rm and the particular job you are
applying for. It can really make a difference.
Top and tail Cover letters are still rather formal affairs,
so never address it to the persons rst name. If you know
the surname of the person you are writing to, write Dear Mr/
Ms X; then sign off with Yours sincerely; if you dont know
the surname of the person you are writing to, write Dear Sir/
Madam, and sign off Yours faithfully.
Tailoring This means making sure you get the name of the
person and company youre writing to, address, job role and
reference spot on, for a start. Then pull something from the job
ad or job spec to show you know what theyre looking for, and
tell them how you match it.
A word of thanks Dont forget to thank them at the end
for considering your application.
Not forgetting emailEmail etiquette Its best to treat this as an online cover
letter, so keep it formal and no SMS speak.
CVS, COVER LETTERS & APPS
What (not) to writewhen applying to the banks
We often come acrossapplications with answersthat have been cut andpasted, which doesntreect well.
NATALIA GARLAND
Head of global graduate marketingand infrastructure, BNP Paribas
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The S.T.A.R. technique may sound like a recipe for reality
television success, but i ts actually the evidence and
competency-based method of interviewing which is
increasingly favoured by investment banks.
S.T.A.R stands for Situation, Task, Action, Result, and is a
method that allows the interviewer to assess your competencies
(read skills or abilities) as a candidate by analysing how
you handled specic events in your past. Instead of asking
hypothetical questions, you nd out how the person actually
reacted in a real situation, making it much easier to distinguish
between strong and weak candidates, says Dr Rob Yeung,
corporate psychologist and director at leadership consulting
rm Talentspace.
It is possible and indeed necessary to prepare for a
S.T.A.R interview. Step one is to identify the core and common
competencies or skills that the banks tend to look for in their
potential graduate recruits. Think leadership, teamwork, initiative,
problem solving, communication, commercial awareness. Step
two is to prepare a bank (no pun intended) of examples of how
youve demonstrated these competencies in the past. Your
examples may come from your work experience, studies, extra-
curricular activities, volunteering etc. Step three is to apply the
S.T.A.R formula to your examples to make sure you cover all the
elements the recruiters will be looking for. But dont learn your
answers parrot-fashion, warns Dr Yeung. Remember the details
so you can give a smooth answer, but do not learn the stories off
by heart or you will sound robotic, he advises.
SituationThis is basically the scene-setting for your example, or the
once-upon-a-time opening to your story. One day, during myinternship with Bank X You shouldnt spend too much time
(or space, if on an application form) on this bit. Set the context
for the story clearly in a few sentences.
TaskNow you are homing in on the specic problem you faced.
The task should be credible so using Lehman was about to
collapse so they turned to me to solve it as an intern probably
wont wash. Instead, you should show a combination of realism
and ambition, choosing a task that was achievable but without
setting your sights too low.
ActionNext, it is time to move on to what you actually did in order to
accomplish the task. This is the really meaty part in which your
skills are put to the test. The key is to show that a) you had an
objective clearly in mind; b) you assessed what needed to be
done; and c) there was logic in your action(s). By the way, theyll
expect more than one action.
Talk about the obstacles you faced and how you overcame
them. Explain what you did, give details of how you carried it
out and why you chose that course of action. Be prepared to
be interrupted and asked to expand.
ResultThey are now waiting to hear or read what happened as a
result of what you did project completed, money raised,
happy customers, contract won or whatever, pitch book
delivered, universe saved (OK, maybe not that one).
Be specic about the result for the company or group
your task involved, and also the result for you for example,
what you learned. If the results were positive, underline your
contribution and highlight your achievements. If the results were
negative, remember that a setback can actually reect positivelyon you showing that you assess the consequences of your
actions, that you are able to learn from your mistakes, and
that you are resilient in the face of adversity.
THE S.T.A.R.
INTERVIEW TECHNIQUE
Te formula to use to answercompetency questions
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GETTING IN
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Three former students, now gainfully employed in
front-ofce roles, give the inside scoop on what to
expect during interviews for investment banking,
sales and trading positions.
Investment banking interviewsIf you make it to the nal round of aninvestment banking interview process,
you will encounter an assessment
centre. Most banks use them. At that
centre, the nal stage will be a round
of interviews.
While rst-round interviews are about
competency and t, assessment centre
interviews focus on evaluating your ability to do the job, so
expect a technical interview with members of the business.
Macroeconomic questions They may start by taking
a general route and ask you macroeconomic questions on
ination, unemployment, gross domestic product, foreign
exchange (FX) and your view on the economy, such as:
What is the dollar/yen exchange rate today? Where do
you think it will be in one year and why?
What is the current price of oil? What have we seen in the
last three to six months? Where will it go?
What is your view on the current sovereign debt situation?
Technical questions Then theyll drill down to more specic
questions, such as:
You purchase some Ford Motor Company bonds. How can
you hedge your interest rate risk? (Go short on treasuries,
so you are left only with the rm-specic Ford risk.)
Graph the price-yield relationship of bonds. What is an inverted yield curve?
How would you explain credit spread?
Brainteaser questions Finally, there are also the apparently
trick questions designed to test your logic, such as:
You have a balance that doesnt tell you how heavy each ball
is. You can only use the balance twice. How can you identify
the heavier ball?
If one tap lls up a swimming pool in two hours and another
tap lls it in four hours, how quick will it be if both ll it up at
the same time?
My advice Practise as many brainteaser questions as you
can. The key to questions you cant answer is to make a good
intelligent guess and try to explain how you are thinking about
the answer, to demonstrate your thought process.
I always remember when I got a really nasty volatility question,
which the interviewer turned into an FX question and I got lost.
My formula was right but my maths went to pot.
He was kind enough to walk me through my mistake so I took
a breath and said, Oh I see, what you are saying is that I
should have done X, Y, Z.
He was impressed that I had listened and picked it up quickly,
and we moved on. He also recommended me as a good hire.
Trading interviewsIf youre interviewing as a trader,
you should also be prepared for
the following:
Can you tell me about a time
when you took a risk?
The key to this question is not the risk
but the analytics surrounding it . Talk
about your thought process before
taking the risk, how you weighed up the opportunity cost etc,
then the results of taking the risk.Do not be surprised if your interviewer throws other possible
outcomes at you in order to see your reaction and how you
would handle it.
FRONT-OFFICE
INTERVIEWS
Insider tips on investment banking,sales and trading interviews
Practise as manybrainteaser questionsas you can. The key toquestions you cant answeris [...] to demonstrate your
thought process.ANONYMOUS JUNIOR
Bulge-bracket bank
12 Careers in Financial Markets 2012 efnancialcareers.com/students
The author is
a junior in a
bulge-bracket
bank in
London.
The author is
now a front-
ofce markets
professional at
a US investment
bank.
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It all begIns wIth a handshake
natixis Challeges that fuel your expectatios
Corporate & investment banking / investment solutions / speCialized finanCial serviCes
.ixi.com
Wth 22,000 exert worldwde, ntx oer creer oortute three jor
ue le: Cororte d ivetet bkg, ivetet soluto (aet
mgeet, prvte bkg, iurce) d seclzed fcl servce.
07/2010visuelJMF/WoolooMooloo
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How do you handle stress?
The market has a way of turning cool, calm, collected
individuals into irrational, impulsive and angry players. If you fall
into the latter group, you will not succeed.
If I were to give you 250k, where would you invest?
Follow the markets to make sure you have an answer to this
question and can rationalise and justify your decision.
Are you willing to put the interests of the company and
a client before your own?
I beg of you not to wafe on about the ethical implications of
this question; it is simply a direct loyalty question and you just
need to answer yes.Which attributes do you think are vital to a good trader?
Demonstrate you have these.
A good trader is able to digest large amounts of information
and to play out scenarios that tie in together. If you want to be
a trader you will need to think for yourself and piece together
various scenarios and outcomes. Youll also need to keep your
objectivity when things unfold in a fast and volatile market.
To prepare for this question, focus on competencies and
abilities suited to trading roles.
What is a call option?
Technical questions will depend on who is interviewing you.
For example, a yield guy, a commodities guy and an equities
guy will all tend to ask questions based on their product.
Other examples include: if the yen/dollar exchange rate
is 110 yen/dollar today and the one-year forward rate is
115 yen/dollar, what does this imply? Would the price of
a call option go up or down when the maturity of the
option is longer?
My advice Whichever role you go for in an investment bank,
some questions are inevitable. You should always be prepared
to say why you want to work for that bank and why you want
that job. And you should always come with some questions
of your own.
Sales interviews
I cannot guarantee 100% that you
will be asked these questions if you
interview for a sales position in an
investment bank but I can say that
they are the questions I like to ask
when Im interviewing graduates
and the kind of question I was asked
myself. You have been warned
Tell me about yourself walk me through your CV.
Lets face it, if you cant sell yourself, you have little hope
of selling anything to a portfolio manager.Why do you want to work for Bank X?
This is your opportunity to demonstrate you have researched
and prepared. It is not enough to sit and reel off a million
statistics about the achievements of the rm. Touch on the
people, the culture, the structure of the graduate scheme.
Make it personal. What genuinely interests you in Bank X?
Why sales?
The answer to this question will help weed out those who truly
love selling from those who just happened to fall into sales as
a profession. Your interviewers are looking to discover your self-
awareness and motivation. Know your strengths and be able
to show how they relate to sales.
What part of the sales process most appeals to you
and which part do you think is most important?
The question is effectively designed to test your knowledge
of the sales role within the bank/division, and whether your
selling style ts the culture of the rm or particular desk.
If the desks revenue is based on a long sales process, the
interviewer will be looking for a sales person with patience,
diligence, organisation and the ability to follow up.
High-sales-volume ow desks will want someone driven to
get the trade and close.
What attributes do you think are vital to a good sales
person? Demonstrate you have these.
The key to this question is to focus on the abilities
that every sales graduate needs and to provide concrete
examples of situations in which youve demonstrated them.
They include understanding your target audience, asking
the right questions, listening to the client, and negotiation
skills.
If you werent to have a career in sales, what would you do?
This question is designed to unearth your true career goals.
I personally ask where do you see yourself in three/ve/10
years? You often nd candidates havent prepared to discuss
their true ambitions. The off-the-cuff response often received
reveals much about their long-term t within the rm.
My advice However these questions are phrased, theyare designed to nd out more about you. How motivated and
passionate are you? Can you sell? Will you achieve good
results? Do you t into the culture and style of the rm/desk?
GETTING IN
Technical questionswill depend on who isinterviewing you. Forexample, a yield guy, acommodities guy and anequities guy will all tendto ask questions basedon their product.
ANONYMOUS
Front-ofce markets professional,US investment bank
efnancialcareers.com/students Careers in Financial Markets 2012 15
The author
is a sales
professional in
an investment
bank
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QWhat are the top qualities you are looking for in yourgraduate recruits?
AHonesty and integrity are top of the list: the candidate must
share our values. Then curiosity, the hunger to learn and try
new things. Finally, exibility and adaptability. We believe leadership
never comes from replicating what was done before but from
constantly asking how we can do it better. We encourage creative
new ways of thinking and a combination of enthusiasm and rigour.
QDo you look for any particular academic qualications,and how can a candidate make their CV stand out?
AWe always look for evidence of a high level of skill and
motivation, as well as something that makes you stand out
from the crowd. Its very important that the candidate thinks
carefully about their career and makes an informed decision about
which division and which bank theyre applying to. Read the job
description carefully and take time to research the bank we
expect to see more than whats on our website. You must be able
to demonstrate some enthusiasm for your chosen career.
QWhat are the most common mistakes that studentsmake when applying?
AUndoubtedly, the most common is a lack of attention to
detail. Any grammar and spelling mistakes look careless
and unprofessional, especially as it is so easy to avoid them now.
Some CVs contain too much information, which makes it difcult
to nd what is relevant to us, while others contain too little, whichmakes it hard to establish if the candidate is right for the job.
During interviews, candidates are stressed so they often do not
listen carefully to the question asked.
QWhat non-work-related activities do you lookon favourably?
AOne of the key things we look for is activities that
demonstrate team spirit, or an ability to work well with
others. This could be something like charity work or sporting
achievements. Candidates need to be able to create a link
between the activities theyve been involved with, and how the
skills theyve gained from this are relevant to the role theyre
applying for.
QWhat would make you pick out one graduate CV overthousands of others you receive in Asia-Pacic?
AIts not purely about academics. Yes, candidates need
to achieve a certain academic standard but they should
GRADUATE RECRUITER
Q&A
Advice fom investment banks graduaterecruiters on how to make it through the process
Any grammar and spellingmistakes look careless andunprofessional, especiallyas it is so easy to avoidthem now.
LAURENCE RAISON
Global head of talent management andpeople development, Socit Gnrale
Corporate & Investment Banking
Isabella Crocker
Vice president, APAC
graduate recruitment,
Deutsche Bank
Laurence Raison
Global head of talent management
and people development,
Socit Gnrale CIB
16 Careers in Financial Markets 2012 efnancialcareers.com/students
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Sharp enough?
Get in touch
www.exane.com
C a s h E q u i t i e s
E q u i t y D e r i v a t i v e s
Asset Management
P A R I S - L O N D O N - B R U S S E L S - F R A N K F U R T - G E N E V A - M A D R I D - M I L A N - S T O C K H O L M - Z U R I C H - N E W Y O R K - S I N G A P O R E
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GLOBAL SERVICES
SunGard Global Servicesrecrute 250 consultants en France
SunGard Global Services, leader sur ses marchsen France, propose des activits de service et de conseildans les secteurs de la banque, la fnance, et lassurance.
Avec plus de 5 000 collaborateurs travers le monde,nous allions un savoir-aire technique et mtier unique,afn de rpondre au mieux aux besoins complexesde nos clients. Nous les aidons grer leurs donnes, optimiser la chane de leurs processus mtiers et intgrer leurs systmes.
Nos collaborateurs dveloppent, au cours des missionsralises, un savoir-aire qui apporte aux tablissements
fnanciers une valeur ajoute autour des mtiers suivants :
Technology Consulting :
Ingnieur tudes et dveloppement Chef de projet
Architecte Expert technique IT Commando
Support applicati
Business Consulting :
Business analyst PMO Finance/Banque
Management de projet Finance/Banque
Conseil Finance/Banque
Nous rejoindre : candidature-consulting@sungard.com
SunGard Global Services
des diffrenciateurs clairs
Nous rejoindre, cest :
Dvelopper une expertisemtier, cre et maintenuepar notre spcialisationet nos actions de ormation
Rejoindre une quipede haut niveau, slectionne
avec attention par notrerecrutement afn de garantir nos clients linterventiondes meilleurs consultants
Disposer dun suivi dansla dure de votre carrire,eectu par un manager attitr
Accder plusde 4 000 missionspour lesquelles nous sommessollicits par nos client grce
notre position de Leader
2011 SunGard - Inormation sur les marques: SunGard et le logo de SunGard sont des marques commerciales ou des marques dposes de SunGard Data Systems Inc ou de lune de sesaflies aux tats-Unis et/ou dans dautres pays. Tous les autres noms commerciaux sont des marques commerciales ou des marques dposes appartenant leurs dtenteurs respectis.
www.sungard.com/globalservices/rance
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also be able to show that they can manage their workload
effectively perhaps through balancing a heavy course load
with extracurricular activities or a part-time job.
Applications must be well written and concise. Attention to
detail is very important and spelling errors are not tolerated.
Thorough preparation and communication skills are the most
important aspects of the application process students need to
articulate clearly why they are strong candidates and why they
want to work for Deutsche Bank.
Q
How integral is gaining an internship to securing a
full-time offer eventually?
AVery important. The internship programme is more than
just summer work experience it is a two-way interview,
as it allows the employer to assess your ability and potential,
and enables the candidate to determine whether this is the right
industry, rm, or division for them.
Hiring for the graduate programme is a long-term commitment,
for both the employer and the candidate, and the internship
programme is a key pipeline. It is therefore important that
candidates approach their search for an internship with the
same rigour, commitment and focus as they would for a full-
time job.
QCan you offer any tips on how to prepare forthe interview process?
AThe key is to evaluate your own strengths,
weaknesses and development areas, so that you
can anticipate the questions you will be asked during
the interview. Its also important to research Deutsche
Bank not all investment banks are the same and
candidates need to know why they want to work for
us over other rms.
Interviews arent always about knowing the right answer to
questions. Most questions are designed to test your thought
processes and logical reasoning skills rather than specic
nancial knowledge. We do, however, want to see a real
interest and enthusiasm for the banking industry.
Remember that the interview is a two-way process. If
candidates dont have any questions at the end of an
interview, it doesnt send out a positive message.
QWhat are the chances of a candidate from theWest securing a position in Asia-Pacifc?
ADeutsche Bank aims to recruit the best students
wherever they are studying. Our graduate training
programme is truly global, and whether you choose to start
your career in London, New York, Tokyo or Singapore, you can
expect the same high standard of training and opportunities.If you are interested in working in a specic country, it is
important to do your research and articulate what interests
you about the region.
QWhat is the number one reason why applicantsare rejected?
AWe assess the qualications of an applicant based on
a variety of factors. Its difcult to specify one particular
reason. We look at academic performance, work experience and
leadership qualities. There are multiple factors that we take into
consideration when making a decision on a candidate.
QWhat are the three characteristics that describeyour ideal graduate hire?
AWe look for a number of things including top talent, overall
cultural t within the bank, and people who are team players.
We also look for leadership qualities and assess their overall work
and academic experience to determine what a candidate brings
to the table.
QDo you arrange work permits, or help foreign studentswork at the company?
AIf a candidate requires a work permit we can work with them
to help with this process.
QIf a candidate does poorly in a core subject, can theystill pursue a career in investment banking?
AWe look at the overall academic performance. Our focus is to
develop a holistic view of a candidate that allows us to look at
their entire academic record, so normally one course would only
be a small component of a candidates full prole.
QDoes the bank have any preferred universities,colleges or schools that it selects from?
A
We have success at schools with strong nance programmes,
but also nd successful candidates with liberal arts and other
academic backgrounds.
GETTING IN
The interview is a two-wayprocess. If candidatesdont have any questionsat the end of an interview,it doesnt send out apositive message.
ISABELLA CROCKER
Vice president, APAC graduate recruitment,
Deutsche Bank
Larissa Goodwin
Associate recruiter,
J.P. Morgan
efnancialcareers.com/students Careers in Financial Markets 2012 19
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Banks will test your numeracy, and logical and verbal
reasoning skills from the initial application stage through to
the nal hurdle at their assessment centres, especially in
EMEA and Asia-Pacic, so be prepared.
The problem is, though, that different banks use different tactics
when setting psychometric tests. Some will expect everyone to sit
a numerical test as part of the online application process. These
are not as difcult as those encountered later in the recruitment
process, are usually taken online, and last about 20 to 25 minutes.
Other rms will only require you to sit an online numerical test if
your CV or application form makes it through their initial lters.
If you perform well here, expect to be invited to take a verbal
reasoning test and, if you succeed, expect an interview.
Finally, some banks will only roll out psychometric tests at their
assessment centres, so if you make it this far, you will almost
denitely encounter them there.
Online numerical testsFor anyone with a reasonable amount of maths education, the
online numerical tests should be relatively simple. They centre
around addition and subtraction, percentages, compound
interest, graph reading, analysing tables and problem solving.
However, they are also designed to catch people out if they
dont read the question properly.
For example, you may see a simple XY graph where X is year
one, year two etc. and Y is some numerical statistic. The
question will ask you what was the Y gure in year three and
candidates will jump to the graph and quickly tick their answer
to move on, while missing that the Y column was cumulative.
The trick is ensuring you have enough time to answer everything.
You have about 20 to 25 minutes to cover 30 to 40 questions,
so it is not advisable to spend ve minutes on one question.
Even though youll probably be doing these on your laptop at
home, prepare as you would for any other exam. Have ready
a scrap of paper, an open Excel spreadsheet and a calculator.
Take the exam when youre sharp and in a quiet place. You willoften receive an email with a link directing you to a test site,
asking you to complete it in ve business days. Make sure you
know when the deadline is, and sit the exam before it expires.
The student section of eFinancialCareers.com offers a series
of numerical practice tests to help students prepare for the real
thing. To take our practice tests, go to enancialcareers.com/
students and click on Numerical Tests.
In-house numerical testsIf you make it to interview or to a banks assessment centre,
youll be required to sit an in-house numerical test. These are
harder than the online ones, touching on things such as bond
maths, differentiation and interest calculations.
Ask the banks human resources team whether the in-house
test questions are likely to get harder as they progress. Often
they do, so youll need to make sure you get the easy ones right
you dont want to lose vital easy marks from sloppy work.
Verbal reasoning testsVerbal reasoning tests are all about attention to detail. Banks
want to see that, within a limited timeframe and in a pressurised
environment, you can digest and quickly disseminate information.
You are usually provided with a passage of information and
required to evaluate a set of statements by indicating whether
each statement is:
A True (does it follow logically from the information or opinions
contained in the passage?).
B False (is it logically untrue based on information or opinions
contained in the passage?).
C Cannot Say (based on the passage, are you unable to
determine if the statement is true or false without further
information?).
Practice is important to passing these but the key is to read each
statement carefully and ensure you understand what its saying.
Everything you need to know is included in the passage of text.
It is about how you interpret this to form a logical conclusion.
These tests are less about general knowledge and more about
attention to detail and being able to maintain high standardsunder pressure. These are qualities banks want to see and the
tests are designed to draw them out, says Sarah Butcher,
editor, eFinancialCareers.com.
TESTING, TESTING
Your guide topsychometric success
Tests are about attentionto detail and being able tomaintain high standardsunder pressure. These arequalities banks want to see
and the tests are designedto draw them out.
SARAH BUTCHER
Editor, eFinancialCareers.com
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Calculating yourFutureValue is easier
than you think
Calculating the future value of an investment is easier when you know how to approach it.
At eFinancialCareers.com, we help you approach the challenge of securing a first internship
or graduate role, and continue helping you right through your career in finance. Our Student
Centre focuses on graduate recruitment at major banks and financial firms, giving you the tools
and insight you need to stand out. Invest in your future today by visiting:
www.efi nancialcareers.com/students
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You may not be able to predict what questions you
will be asked at interview but you can know the types
of question to expect. The questions banks ask will
generally come from one of ve categories.
Competency questionsLoved by graduate recruiters and human resources interviewers
everywhere, the aim of this type of question is to establish your
behaviour in a given situation. This type of question allows us
to focus on what the candidate brings to the table beyond their
technical skill set. We want to determine whether candidates
have the personal attributes to succeed. Do they have good
judgement, are they self-starters, are they inuential and can
they lead? conrms Keisha Smith, global head of recruiting,
Morgan Stanley.
Come with at least two answers prepared for each type of
major employability skill or competency that you can identify.
Some examples:
Tell me about a time when you faced a challenging experience.
How did you overcome it and what was the result?
Can you describe a situation in which you showed initiative?
Motivation questionsThis is the why this company/division/job question. There
is no excuse for not prepping this type of question correctly.
They want to know a) if you know the difference between their
bank/division/role and another, and b) if you have a genuine (or
plausible) reason for wanting to work in it. Some examples:
Why this particular division as opposed to sales and trading?
What set of skills does a private banker need?
Brainteaser questionsThese are the apparently cryptic questions originating from
the tech geek interview-style espoused by companies suchas Google or Microsoft, which have migrated to interviews
for banks. Often they will pop up in between competency,
motivation and/or technical questions.
There is no right answer. While many are pure mental arithmetic,
others are designed to see your logic in working them out.
Some examples:
Why are manhole covers round? (if you say because the hole
is round youre out.)
What is 21 x 19?
Technical questionsMostly asked by business interviewers, i.e. the people running
the desks in the business area you want to join. They ask these
to weed out the time-wasters students who havent kept
up with whats going on in the economy or markets around
them. Even at graduate level, a certain standard of industry
knowledge is expected. Some examples:
What is your top stock pick and why?
How would you persuade a German pensioner to save Spain?
Your questions for themYes, they do expect you to come with questions at least
two. Avoid the classic mistakes at this stage. One, thinking
the interview is over now youve reached the have you any
questions for us stage? Two, using this as an opportunity to
ask about pay, holidays, benets. Instead, ask questions about
the industry, company and the job itself. All safe.
Some examples: I read recently that M&A activity is turning a corner. Would you
be willing to give me your view on the M&A trend in the market?
How is performance on the graduate programme measured?
THE FAMOUS FIVE
Tere really are only fve typeso interview question
We want to determinewhether candidateshave the personal
attributes to succeed.
KEISHA SMITH
Global head of recruiting, Morgan Stanley
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Depending where you are in the world, the notion of diversity
is a widely subjective and extremely relative experience.
In the US, where diversity has become ingrained into the
corporate strategy of most large companies including all of the
major banks, it dates back half a century to when the Presidents
Committee on Equal Opportunity was created in 1961. It was
followed by afrmative action in 1970 with its quotas, goals and
timetables. But it wasnt until the 1980s that having a diverse
workforce became valued as a business strategy.
While that strategy still holds today, in a few regions there are signs
some industries are less diverse than they were a few years ago.
How female-friendly?Within investment banking, the nancial crisis has not been
benecial to diversity initiatives. The number of women in senior
level management, which was already disproportionately low,
had dropped to just over 15% in 2009 from nearly 18% in 2007.
In the US, the number of women working in nance has fallen by
141,000 over 10 years, while the ranks of men grew by 389,000.
In China, Taiwan and Vietnam, more women than men are
taking MBAs. A Bloomberg survey found that 76% of Chinese
women considering business school are aiming for a top job,
compared with 52% of American women.
Financial services has some catching up to do, but is it really the
case that banks and investment rms are not devoting as many
resources to diversity initiatives as they did in better times?
Milton Irvin, a managing director and Americas head of diversity
and inclusion at UBS, believes not. Diversity programmes
continue to involve a multifaceted approach, devoted to
leveraging talent, impacting culture, and delivering on and
taking advantage of marketplace opportunities, he argues.
LGBT leading the wayGlobal banks and investment rms have a variety of structured
efforts in place, including internships, immersion events andmentoring programmes. For example, UBS has its Freshman
Forum and Sophomore Symposium to get undergraduate
students interested in the nancial sector. These programmes
are geared to women and ethnic minorities, as well as lesbian,
gay, bisexual and transgender (LGBT) candidates.
In fact, in the US, the LGBT community has become one of
the most vocal elements of the diversity movement. Recently,
Deutsche Banks New York headquarters hosted a summit
called Out on the street, dedicated to advancing the ranks of
LGBT banking leaders.
Bank of America Merrill Lynch, Barclays, Citi, Goldman Sachs and
Morgan Stanley also participated in the event. They discussed
progress to date, particularly the emergence of private banking
and advice-giving practices for gay couples, by gay advisors.
A revolving door?People in the eld say initiatives not only need to focus on
recruitment but also on the more critical issue of retention.
Irvin says there is clearly more to be done to hold onto qualied
talent. The problem in the nance sector, says Irvin, is that
highly qualied professionals can easily nd other opportunities
outside the industry or even at the entrepreneurial end.
Jennifer Hatch, president and managing partner at Christopher
Street Financial, a wealth management rm catering for the
gay and lesbian community, was one of those people. She
previously served as a vice president at J.P. Morgan and as
a managing director at Bear Stearns, working in equities andhigh yield bonds for institutional investors.
Back when I rst started, women couldnt even wear
a professional pant suit into the ofce, she says.
DIVERSITY CHALLENGE
Ensuring equal treatment for all?
GETTING IN
Back when I rst started,women couldnt evenwear a professional pantsuit into the ofce.
JENNIFER HATCH
President and managing partner,
Christopher Street Financial
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Because of its reputation as the glamour side of
investment banking, mergers & acquisitions (M&A)
is one of the most competitive sectors to break into.
M&A teams in investment banks advise client companies
on mergers (where two companies join up as equals) and
acquisitions (where one rm takes over part or all of another).
Big investment banks only get involved with transactions worth
at least $100m. At the top end, the deals can be worth billions.
A career in M&A demands considerable commitment. M&A
bankers advise their clients at stressful and critically important
periods in a companys lifetime, so must make themselves
available whenever the client needs them. Junior bankers work
long hours and can expect to work late at night if need be.
M&A is heavily quantitative so while you dont need to be
an economics or maths major, you do need to be a strong
quantitative thinker, says K. Don Cornwell, managing director,
investment banking division at Morgan Stanley.
Key playersThe big US investment banks dominate the 2010 advisor rankings.
The highest-ranked European player was Credit Suisse.
Roles and career pathsThere is a relatively straight route up the career ladder in
M&A. You start out at analyst level for three years, move up
to associate for three years, then vice president, director and
managing director, although the job ti tles may vary. Within those
roles you have a chance to focus on sectors such as consumer,
nancials, oil and gas or media and telecommunications.
The more senior you get in M&A banking, the more youll deal
face to face with clients. At the junior level you may attend client
meetings with more senior bankers but mainly youll be focused
on complex nancial modelling and research to compile the
pitch book the document the rm uses to outline its ideas on
which companies a client should buy or sell to.
As an analyst, your key tasks will include working on these
client service presentations, largely for M&A deals, but
occasionally for initial public offerings. A lot of this will involve
building a nancial model, valuing a company or benchmarking
it against its peers.
It is only later that you step away from the number crunching.
The key difference between an analyst and an associate isthat you take more responsibility for the transactions and
projects. Youll be assigned more tasks, so expect your
workload to multiply.
MERGERS &
ACQUISITIONS
Te international jet-setof investment banking
M&A is the toughest areaof investment banking tobreak into
Expect long hours, numbercrunching and a steep learningcurve at junior level
Senior bankers do most ofthe client liaison
Financial advisor Rank value ($bn) Market share (%)
1. Goldman Sachs 554.5 22.8
2. Morgan Stanley 538.0 22.13. J.P. Morgan 440.1 18.1
4. Credit Suisse 412.7 17.0
5. Deutsche Bank 341.7 14.0
Source: Thomson Reuters.
Global advisor M&A rankings (announced deals) 2010
How hot
Money
Prestige
Opportunities
M&A is heavily quantitative so while you dont needto be an economics ormaths major, you do needto be a strong quantitativethinker.
K. DON CORNWELL
Managing director, investment banking
division, Morgan Stanley
24 Careers in Financial Markets 2012 efnancialcareers.com/students
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Leading in fnancial advice, worldwide
Apply for our Graduate Programme, Summer Internship
Programme or Long Term Internship Programme and you could be
working with world-class teams that provide market leading advice
to governments, corporations and individuals, within a culture that
values innovation, integrity and intellectual rigour.
Submit your online application form at
www.rothschild.com/careers
No other investment bank could
have given me the opportunity to
work on so many deals and so give
me such a great learning experience
Analyst, Frankfurt
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Pay and bonusesMany banks have mitigated regulatory pressure on bonuses by
increasing base salaries, as well as altering the structure of variable
pay to include deferrals and a larger proportion paid in stock.
This is reected in the numbers below, as well as pay gures
related to other areas of investment banking covered elsewhere
in this guide.
Skills soughtGiven that youll be working on complex nancial models
for valuing companies, and piecing together presentations
to clients, numerical and analytical skills are essential.
Second languages are valued for working with overseas
clients, as are stamina and attention to detail.
While it is not necessary to have a nance or mathematics
degree, you are expected to have rst-rate analytical and
numerical skills, which are required for valuation exercises and
nancial modelling that could form the basis of a client pitch,
says Jasper van Balen, global banking analyst programme
manager at Royal Bank of Scotland in London.
Many of an analysts duties are focused around nancial
modelling but, as you get more senior, these technical skills
need to be combined with softer qualities.
As well as having strong technical and nancial skills,the best M&A bankers are also part-lawyer and part-
psychoanalyst, says Jason Morris, executive director, head
of southeast Asia M&A, Nomura. This combination marries a
strong knowledge of the local regulations in each market with
an ability tactically to develop an overall deal strategy based
on the dynamics, motivations and cultural considerations of
all stakeholders. It also brings to the table smart negotiation
skills to secure the best outcome for your client.
Client focus, impeccable ethics and team orientation are vital.
Having teams made up of individuals with diverse experiences
and backgrounds helps us to serve clients better, adds Celine
Desaedeleer, executive director, investment banking division at
Goldman Sachs.
You also need to be a self-starter, and to try to be ahead of the
curve in anticipating the next appropriate step, because you will
not always get day-to-day guidance on what youre supposed
to be doing, adds Morgan Stanleys Cornwell.
Were often asked to do analyses with limited information or
inputs, so being creative during the nancial modelling process
is important, he says.
INVESTMENT
BANKING
Role Base Bonus Bonus YoY
1st-2nd year analyst 90-100 40-80 -5%
3rd year analyst 110-170 70-100 -6%
1st-2nd year associate 120-200 110-200 -6%
3rd year associate 160-180 150-225 -7% Vice-president 200-250 200-300 -41%
Director 250-300 300-500 -34%
Managing director 300-500 800-1,400 -23%
Source: Options Group Intelligence Unit.
Average global investment banking pay 2010 ($k)
What are the key elements of your job?
One of the most important pieces of advice
we give is our opinion on how much clients
should expect to pay for a company or sell
a company for, so a large part of the job
involves coming up with a suitable valuation.
We need to understand the business and
take a view on the outlook for the industry.
Whats your average day like?
If Im working on a live transaction I would get
involved with tasks such as writing an information
memorandum (describing the company for sale to
potential bidders) or management presentations.
If Im helping write a pitch book I would spend
time researching the potential clients businessand industry. I also do nancial modelling
and analysis for valuation purposes. If
Im lucky I might get invited to a client
meeting. When its quiet I nish around
8pm; on busier days its after midnight!
What are the best things about your job?
You can take on a lot of responsibility quickly,
something you really start to notice
once people begin to trust you more.
Its a constant learning process all
the way through your career.
There must be some downsides though?
The long hours take a bit of getting used to, and
its difcult to make plans during the week as its
quite rare that Im out of the ofce before 10pm.
How do you see your career progressing?
In ve years time I hope to have started
to build my own list of client contacts and
to have worked on a large and varied list
of transactions. I expect Ill be much more
involved in client pitches as well as in the
management side of a transaction process.
Nathalie Ferretti
Analyst, M&A,Rothschild
Nathalie studied economicsat Bristol University andjoined the Rothschild graduateprogramme in 2010. You can take on a lot
of responsibility quickly,something you really startto notice once peoplebegin to trust you more.
efnancialcareers.com/students Careers in Financial Markets 2012 27
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Before nancial products are traded, they must be
created. And its the pink-collared bankers in the capital
markets divisions of investment banks who work on the
production line.
Equity capital markets (ECM) bankers help companies raise
money by issuing shares and related derivative products, which
are sold to investors. They act as underwriters in the process.
This means that, in exchange for a fee, they guarantee they will
sell the shares the company is issuing for a certain price. If they
cant nd enough people to buy the shares at the price theyve
agreed with the client, the bank is obliged to buy the shares.
Debt capital markets (DCM), meanwhile, deal with saleable units
of debt in the form of bonds.
Bonds come in all shapes and sizes, including treasury bonds
issued by governments (the least likely to default), investment
grade bonds issued by companies (not too likely to default) and
so-called high-yield bonds (which are more likely to default so
pay a higher rate of return).
DCM is also called the xed-income market. This is because
bonds typically pay a xed amount in interest until their
redemption date (i.e. when the original issuer has to pay back
the money on the bond to whoever owns it at that time).
For example, a bond worth 100 (60) might pay out 10 a
year, making the interest rate 10%. If the rate paid on a bond
falls, the amount the bond is bought and sold for will therefore
need to rise until the redemption date at the end of the bonds
life, when the owner will receive its face value, in this case 100.
Financial products that have been created by capital markets
bankers in the so-called primary markets go on to be bought and
sold by banks salespeople and traders in the secondary markets
(see Sales, trading and research, page 32).
Roles and career pathsAs banks are essentially offering similar services, they have
to convince clients that their rm is the one to use. So before
new equity or debt-related products can be created, dealoriginators are deployed to bring in new business.
Origination specialists spend a lot of time travelling to clients
to gain an insight into their nancing needs. However, you are
unlikely to become one until youve worked in capital
markets for some time.
As a junior capital markets professional, you are more likely
to be involved in structuring the products so that they meet
the client companys nancing needs and are compelling for
investors, or in the syndication process (preparing for the sale
of nished products to investors).
These days, it is often not sufcient simply to be an equity or a
bond specialist. Banks such as Morgan Stanley, J.P. Morgan,
Citigroup and UBS have combined their equity and debt
origination businesses, so it helps to understand both sides
of the coin.
Pay and bonusesIn Hong Kong, DCM professionals with one to four years
experience can earn anything in the range of HK$300k-850k
($38k-109k), according to the Robert Walters salary survey.
This rises to HK$1.6m+ ($205k+) at the senior end, and ECM
bankers can expect a similar gure.
In the UK, meanwhile, DCM salaries start at 30k-45k
($48k-73k), according to the 2010 Michael Page salary survey.Associates (those with three to ve years experience) can earn
50k-75k ($81k-122k), while managing directors should expect
a salary of up to 250k ($407k).
CAPITAL MARKETS
Where fnancial products are born
Capital markets teams bringfinancial products to market
Junior bankers structureproducts, rather than originatebusiness
Equity and debt capitalmarkets teams are becomingmore closely linked
How hot
Money
Prestige
Opportunities
Product knowledge,such as how to structureand price various equityproducts, and marketunderstanding are key skillsof a capital markets banker.
DARIUS NARAGHI
Director, equity capital markets, Deutsche
Bank in Hong Kong
28 Careers in Financial Markets 2012 efnancialcareers.com/students
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jpmorgan.com/careers
is youropportunity.strength
Our
J.P. Morgan is a marketing name of JPMorgan Chase & Co. and its subsidiaries worldwide.
2011 JPMorgan Chase & Co. All rights reserved. J.P. Morgan is an equal opportunities employer.
Our strong position in the market has been built on the character and
intelligence of our people. To maintain that strength, we are committed
to recruiting and developing top talent. This means that if you want to
really advance your career, you should become part of our team. Its our
goal to make sure you achieve your goals.
Graduate Deadline: 11 November 2011
Internship Deadline: 11 November 2011 Asset Management,
Finance, IB Risk, Investment Banking, Sales, Trading & Research
8 January 2012 Operations & Business Services, Technology
Apply via the Europe section of our careers website.
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See yourSelf moving onwardand upward
At Barclays Capital, your unleashed potential is our most powerful
asset. Thats why we look to your drive, ideas, ambition and talent
to become the future of our business. And whatever you put
in, we will match with unparalleled training, support and globalopportunities. We understand that cultivating top talent is a critical
business priority, not just a nice to have.
So expect to be stretched. Expect to go further, faster and higher.
And expect to have your potential fulfilled.
Exceed your expectations at b./ss
expect opportunitieS
ssued by Barclays Bank PLC, authorised and regulated by the Financial Services Authority and a member of the London Stock Exchange, Barclays Capital is the investment banking division ofBarclays Bank PLC, which undertakes US securities business in the name of its wholly-owned subsidiary Barclays Capital Inc., a FINRA and SIPC member. 2011 Barclays Bank PLC. All rightseserved. Barclays and Barclays Capital are trademarks of B arclays Bank PLC and its afliates.
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INVESTMENT
BANKING
In the US, capital markets analysts can expect $60k-65k in
their rst year, rising to $70k-90k after two years, according
to recruitment sources.
Skills soughtIf you want to work in capital markets, it will help to have an
understanding of, and interest in, the technicalities of company
nancing, but this isnt the limit of the job.
Product knowledge, such as how to structure and price
various equity products, and market understanding are key
skills of a capital markets banker, says Darius Naraghi, director,
equity capital markets at Deutsche Bank in Hong Kong.
As ECM bankers become more senior, it is also important
to develop strong relationships with regional companies that
are looking to raise money, and also with institutions that arelooking to invest.
Following the nancial crisis, banks are less busy issuing
complex nancial products than before, but it will help if you
have the mathematical ability to deal with complex products
in case they become popular again one day.
Finally, if you want to progress, it is important to look at the
bigger picture and take an interest in industries and sectors
outside your current area of specialisation, suggests George
Davis, managing director, RBC Capital Markets. You need
to understand your role, where you t within your immediate
group, and where your group ts within the rms broaderobjectives, he says.
You should also have a clear understanding of client
needs and the utmost in ethical conduct.
Although you will be given a high level of individual
responsibility, capital markets careers are not like trading
careers, where individual excellence can reap the highest
rewards.
You have to be a real team player, largely to keep a variety
of parties happy throughout a complex process.
Bookrunner Proceeds ($bn) Market share (%)
1. J.P. Morgan 452.9 7.5
2. Barclays Capital 448.4 7.5
3. Bank of America Merrill Lynch 413.3 6.9
4. Deutsche Bank 393.7 6.6
5. Morgan Stanley 320.9 5.3
6. Citi 297.9 5.0
7. Goldman Sachs 295.7 4.9
8. Credit Suisse 284.9 4.8
9. UBS 262.2 4.4
10. RBS 216.3 3.6
Source: Thomson Reuters.
Top 10 bookrunners: global debt, equity & equity-related activity 2010
How did you end up in capital markets?
I started my career on the buy-side during the
fnancial crisis. It was obviously a challenging market
and I decided Id rather move to a more diversifed
investment bank to help broaden my skill set.
After visiting the Morgan Stanley careers website,
I leveraged some prior relationships and attended
one of the banks networking events. Eventually I
was accepted onto its training programme and that
helped me get up to speed as quickly as possible.
Why do you think youre good at what you do?As a capital markets analyst, I need to be able
to juggle multiple tasks simultaneously and
absorb and react to all sorts of data. I am
dependable and exercise good judgement
two assets I acquired on the job.
What are the most appealing aspects?
Being on a team and the competitive
dynamics of the job appeal the most. They
remind me of my time on the University of
Maryland golf team. The job requires you
to work hard and earn the trust of team mates.
Being able to have a direct, meaningful impact
on clients also makes the job rewarding.
What have you found most challenging?
Unpredictable requests, particularly those received
at the last minute. We have to be able to prioritise
tasks and stay organised all the time. Id say that is
one of the most challenging, demanding and integral
parts of the job. But the more experience you get,
the better you become at balancing the workload.
What are you working on today?
Im currently working on some debt fnancing
transactions, in collaboration with our mergers
and acquisitions team in investment banking. I
also speak frequently to the treasury teams at
large companies to provide fnancing terms andmarket updates for live and potential transactions.
Jason Occi
Analyst, globalcapital markets,
Morgan Stanley
Jason studied at theUniversity o Maryland andmajored in fnance. He isnow an analyst in MorganStanleys global capitalmarkets division, havingjoined the bank in 2009.
I need to be able tojuggle multiple taskssimultaneously andabsorb and react toall sorts of data. Iam dependable andexercise good judgement
two assets I acquiredon the job.
efnancialcar
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