the guide to find a job in the financial sector

8/4/2019 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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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.



9/88 GettyImages -

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.


10/88


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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.



12/88

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

[email protected] 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


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


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.


15/88


16/88

It all begIns wIth a handshake

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Corporate & investment banking / investment solutions / speCialized finanCial serviCes

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ue le: Cororte d ivetet bkg, ivetet soluto (aet

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07/2010visuelJMF/WoolooMooloo


17/88

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


The author

is a sales

professional in

an investment

bank


18/88

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



19/88

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21/88

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



22/88

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



23/88

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


24/88

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



25/88

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



26/88

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



27/88

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


28/88


29/88

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.



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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



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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.


32/88

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.


33/88

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.

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