There are also mid-sized investment banks which are regionally oriented or situated in the middle market such as Piper Jaffray. Small, specialized firms are called boutiques which might be oriented toward an industry vertical, bond-trading, M&A advisory, technical analysis or program trading.
Jobs For Graduates
By far the most common route into investment banking for a graduate’s degree holder is to be hired into a bank's analyst program. MBAs are generally hired as associates. Analysts and associates work within specialized groups but they may not always have control over the group to which they get assigned (analysts especially).
Typically, an analyst will stay in position for two to three years before leaving for an MBA or for a promotion to Associate. An associate will typically be in the position for three to four years prior to a promotion to Vice-President.
Investment banking is a notoriously challenging field to break into. The business involves heady, high stakes deals, huge sums of money and, unusually high levels of compensation. It's no surprise that this is a tough area to get into.
Skill and Talent Needed
Investment banks want employees with a combination of strong analytical and interpersonal skills. Some jobs may require one skill set more than another. For example, brokers need to be mainly sales-oriented; equity analysts require both analytic and interpersonal skills. Other highly sought after skills are:
- People Skills
- Communication skills
- Analytical skills
- Ability to synthesize
- Creative ability
- Sales skills
- Work hours – 50-120/week
Going into 2013, starting salaries for investment banking positions with a bachelors degree should range from $100,000 to $150,000 after bonus. Most of the major banks in NYC are offering a starting salary of around $75,000 plus a $15,000 to $20,000 signing bonus. Further bonus can range from $20,000 to $40,000 depending on performance. Starting salaries with an MBA degree (associate position) range after bonus from $120,000 to $220,000. These salaries vary with firms and with the region of the country you are in. Bonuses typically would be 10-50% of salary to start and can move to one to three times salary later. Lately, salaries have increasingly included an equity component which may not be liquid for up to nine years, although as an analyst you would typically be sheltered from this.
Although banking salaries and bonuses fluctuate according to market condition and the firm’s profitability, many graduates still outperform their peers in terms of first year income even in the tough periods like 2008/9.