Career paths

Analyst

This is the lowest position of all and is what graduates become when they join an investment bank. But low doesn't mean easy. According to Andrew Le Lievre, head of graduate recruitment Asia Pacific at Morgan Stanley, "It's a pressure cooker. The hours analysts work is no walk in the park."

What analysts do varies from division to division. In corporate finance, analysts are number crunchers who put together pitchbooks (company and sector research that helps banks win bids) and analyse a company's financial products. In sales, analysts telephone relatively unimportant clients on non-crucial matters. On the trading floor, analysts can't trade until they've passed their regulatory exams, and even then, they are heavily constrained until they have proven they're not going to press the wrong button and lose a small fortune. At most banks, you will be an analyst for three years.

What does it take to move to the next rung?

"You would need to be doing a decent job. At analyst level, they are doing all the worst jobs, general modeling, research and perhaps some degree of involvement in deals, but in those they would have to show their mettle," says Elizabeth Ong, head of graduate recruitment at Deutsche Bank Australia.

If an analyst is not promoted to associate level after three years, many decide to enrol in a Masters in Business Administration (MBA) programme, or leave and find work in other sectors. "They are highly sought after because their records are so good and the experience they've gained is priceless," says Morgan Stanley's Le Lievre. After an MBA, many return to investment banking; the degree can help them over the hurdle that felled them, he says.

Associate

The next rung, associates, are analysts who have made the grade, or business school students who joined after studying an MBA. Associates typically have a team of analysts in their charge, to whom they allocate work.

Expect to be an associate for another three years before any chance of moving up to the next rung, associate director (the position is also called senior manager or, at US banks, vice-president).

Associate director/senior manager (vice-president)

At this level, life starts to get exciting. The title sounds grand, but don't be deceived: senior managers are plentiful at any large investment bank. You'll manage the day-to-day affairs of the associates and analysts beneath you, and you're likely to have more contact with clients. If you work in sales, trading or research, you should have your own book of customers, more relaxed trading risk parameters, or your own list of companies to research.

"If you're made a VP, you can lead a deal in markets generating a decent amount of money. You need to show leadership standards and a deep awareness of the bank's culture, and nuances in a particular industry," Deutsche's Ong says.

This is often the highest point employees reach. Many opt at this point for a new career rather than wait for further advancement and many switch to another bank for promotion. Ong says, "If you're not made a director after two years in a row, you get the message."

Executive director or director

Now the top rungs are within your grasp and you are making a lot of money. Executive directors or directors (the titles are interchangeable) are the right-hand men and women of the real potentates of the investment banking world - the managing directors.

Managing director

You've made it! MDs are the upper echelons of the hierarchy. They make the most money and have the biggest offices. MDs are the people who deal directly with clients and originate (bring in) business.

Very few people who started as analysts make it this far. At one large US bank, only 6% to 8% of directors are promoted to managing director each year. At Goldman Sachs, there are little more than 1,000 managing directors for 20,000 employees.

"These people have already demonstrated excellence in all technical aspects of the organisation, in leadership and communications. What they have that takes them even further is a capacity not just to lead, but to elicit excellence, performance, commitment from their people," says Paula Knowlen, general manager for Westpac Bank and the managed services business at Hudson.

Brain drain

Australia is a net exporter of investment bankers. "The challenge we face is luring them back or finding overseas people for the positions. As this is a much smaller market, it cannot offer the breadth of banking exposure that London or New York can. But where Australia has one big advantage is in the lifestyle it can offer," says Michael Fraccaro, head of HR at HSBC Australia.