Investment banking overview
When it comes to exciting careers, investment banking has got it all: money, status, power, adrenaline and risk.
However, a career in investment banking does not always reward expertise and hard work with consistent success. It is a journey full of ups and downs, highs and lows. Ever heard of the credit crunch?
So before you make the decision to embark on the path towards becoming a successful investment banker, you should firstly discover what investment banking is really all about.
What is an investment bank?
First of all, an investment bank is nothing like your local high street branch. You cannot simply withdraw a tenner from it or deposit a cheque. An investment bank is a specialist financial institution that predominantly deals in stocks, shares and bonds.
These companies essentially consist of two distinct sections: capital markets and corporate finance. The capital markets division actively trades bonds, stocks and other assets on behalf of wealthy individuals, companies, or for the investment bank itself. This is the proactive, fast decision-making, buying and selling side of the company.
Corporate finance divisions advise companies on how to expand their businesses and raise their capital by helping them to distribute shares and bonds. They also provide advice and assistance on corporate mergers and acquisitions. This is the consultative side of investment banking and focuses on providing the most efficient and lucrative advisory service possible to other companies.
Investment banks are widely famed for providing their employees with a handsome wage, and the starting salary for a career within one of the world’s biggest investment banks, such as Goldman Sachs, Citigroup and UBS, is likely to be one of the most competitive around.
What skills do investment bankers need?
However, with great reward comes great responsibility. A career in investment banking allows you to play an incredibly important role in society, as the world’s most influential organisations will ultimately be dependent on your expertise.
Investment banking careers are ideally suited to people with endless enthusiasm, huge ambition, an unbeatable work ethic and the ability to handle immense pressure. The lifestyle, status and money can be fantastic, but in order to thrive and survive in such a competitive industry it is essential to consistently perform at the top of your game.
Front office and back office
Understandably, the various departments and intricacies of each company mean that investment banking cannot be defined as one single career. However, the many different roles can basically be grouped into two different categories: front office and back office.
Front office positions are widely considered to be the more prestigious careers. These are the client facing jobs, such as fund manager and stockbroker, and are conventionally geared towards people with unassailable confidence and a ‘work hard, play hard’ attitude.
The back office functions (often known as ‘operations’) provide the glue that holds the hectic world of investment banking together. These employees include administrative staff, who process trade confirmations, and IT professionals, who support the bank by providing innovative and efficient computer solutions.
If you’re interested in the fast-paced and exciting careers involved in investment banking, read more on our sister site AllAboutFinanceCareers, apply for a few positions on our jobs board or check out the following occupational profiles: