The eight top career switches in investment banking now
Moving from a back office role into a front office position has become something of a pre-crisis, pre-Kweku dream.
And yet, changing tack in your career is still possible. These, according to recruiters and bankers who have made the switch, are the current trends.
1. Trading assistant to trader
It might be reflective of how trading jobs are developing into increasingly electronified or process-driven positions, or maybe it’s down to the exodus of investment banking traders to hedge funds, but trading assistants are increasingly being promoted to become actual traders.
One recent example is Martin Lacey, an FX exotics trader at J.P. Morgan, who moved across from a five-year trading assistant job at the bank, having previously worked in a market risk position.
Recruiters suggest that a deep understanding of the product area combined with being a known entity to the bank is necessary to make the move internally.
2. Prop trading to fund management
Prop traders are, of course, being pushed out of investment banks are regulators force firms to close down their internal trading desks. This has resulted in a flurry of new hedge fund launches by senior traders who then poach their former reports. But launching a hedge fund is risky, and many traders who fled to the buy-side have since returned.
Credit Suisse is attempting to sell asset management as an alternative career to prop traders thinking of departing for the hedge fund sector. This could be a good move, as we’ve mentioned previously, trading careers tend to go on a downward trajectory after 30 and asset management presents itself as a viable long-term career.
3. Big Four consulting to programme manager
Consultants at Big Four professional services firms are increasingly looking to reinvent themselves as programme managers for “end-users” on change and transformation projects, says Ben Cowan, director at recruiters Investigo Change Solutions.
“They’re used to stakeholder management, are good communicators and get the project moving. They’re also keen to remove the sales element from their job,” he says.
The pay also helps – programme manager jobs in change pay upwards of £1,200 a day.
4. Mid-ranking investment banker to private equity
The route from analyst and associate in investment banking into private equity is a well-trodden path, and one that has become increasingly popular globally over the past 12 months. However, it’s not a one-way track.
“As surprising as it sounds, a lot of former investment bankers are returning to the sell-side after a few years’ experience in private equity,” says one PE recruiter who didn’t want to be named. “The result is that private equity firms are increasingly turning to associate directors or VPs.”
5. Investment banking to Big Four advisory work
In the old order of things, investment banks used to tap newly-minted ACAs from the Big Four accounting firms for their corporate finance divisions. Now, the flow is all the other way as Big Four firms expand their advisory functions.
The latest recruit is Paul Staples, a former senior managing director at BNP Paribas, who joined Deloitte as a partner in its corporate finance division earlier this month. This follows KPMG’s recruitment of James Agnew, the former chairman of corporate broker at Deutsche Bank, in October and Peter Whelan, a former Rothschild banker, leaving for PwC.
The hours won’t necessarily be any less brutal, but the job security could be greater.
6. Front office investment banker to FinTech start-up
FinTech firms, specifically smaller financial services technology start-ups, are disrupting the way that financial services organisations are thinking about IT. Whether that’s new competitors, or cheaper solutions that would have previously been built in-house, FinTech start-ups are proliferating in greater numbers At the helm of many are former investment bankers.
“There are so many front office investment bankers here,” says Nikolay Storonsky, founder and CEO of fintech firm Revolut based out of Level 39 in Canary Wharf and a former trader. “A lot of the best guys have left the industry.”
7. Trading to risk management
Risk management is becoming better paid, more interesting and higher profile within investment banking. Trading is becoming increasingly electronified, ever smaller and increasingly shaky. Not surprisingly, traders are trying to orchestrate an internal move into risk management.
“We are seeing some front-office staff such as traders transition to the middle office or into risk related roles where their knowledge of products and trade processes is valuable,” says Luke Davis, vice president of Robert Half UK.
8. Technology project manager to transformation specialist
Again, it’s a case of former technology project managers trying to emphasise their experience on change projects for contract roles that could see £200+ added onto their day rates, says Cowan.
“It’s not necessarily a case of reinventing themselves to ride the transformation wave, more re-emphasising their change experience and ability to communicate technology needs to the business,” he says.