Are investment banking analysts happy? This is a question that plagues banks, forever fearful of losing their juniors to another sector. Pay increases have not resulted in greater satisfaction. Reduced working hours still mean they spend most of their lives in the office. Greater responsibility hasn’t helped increase average tenure.
So, what do junior bankers want? We’ve spoken to over 50 analysts in banks across London and New York (off the record) to find common frustrations and factors that keep them happy in their jobs. This is our list of junior bankers career loves and hates.
Junior investment bankers love:
1. Dealing with complex problems: Whatever their contribution, being involved in complex M&A, equity or debt capital market deals when companies are in the middle of a “strategic overhaul” and seeing that work come to fruition is a source of satisfaction for juniors. “These deals will shape their future for years to come,” enthused one.
2. Steep learning curves: To even get into an investment bank these days – assuming you’re not a poet – you need relevant experience, impeccable academics and have usually studied finance or economics at university. Even so, once you’re in, the training programmes and on-the-job learning is intense. “I learned more in the first few weeks than I did through an entire finance degree at university,” says one.
3. Rotations: Not all banks offer these, but being given the chance to spend the first two years of their career rotating around various front office teams is a big plus for most analysts. Millennials don’t like being pigeon-holed and getting exposure to various specialities early on is valued: “This means I’m well skilled, I guess,” said one analyst.
4. Great people!: Juniors like their colleagues - this was almost universally highlighted as a plus point. They like the exposure to senior bankers who can help and guide them, and the like working with like-minded individuals in the analyst pool. “I have great colleagues that I can work with an learn from,” said another analyst.
5. The range of deals: Not every deal can be a big hitter, but some are. Not every deal is working with an international company, but when they are it broadens analysts’ horizons. “Being exposed to companies with international operations that conduct cross-border activities both on the financing or the M&A side is enriching from a cultural perspective, as well as intellectually stimulating,” said one.
6. ‘Constant coaching’: Senior bankers are under pressure to ensure that juniors get what they need. Away from the formal training programmes, juniors are given ‘constant coaching’ from either senior bankers or their associate ‘buddies’, they suggest. “Senior people always try to help me when they can,” says one.
7. Pay: Yep, juniors are in it for the money. Earning potential in investment banking may not be as great as it was, but compensation of £77-109k ($112-159k) in your first year is not to be sniffed at. “As a new graduate, the pay is a big plus point. I’m earning vastly more than my university mates,” said one.
What junior investment bankers hate about their jobs:
1. Being seen as a ‘banker’: Image means a lot, and – assuming the juniors have enough time to maintain their network of friends outside of the industry – analysts working for a bank have to deal with misconceptions about working in finance. “There are great opportunities for young people. Not all bankers are greedy monsters,” said one.
2. Pedantry: A few years in banking and you’ll be an attention to detail nut. Getting figures wrong in pitch books has obvious implications, so ensuring everything spot on is an important skill, but worrying about corporate colours or misplaced bullet points is a frustration. “Unnecessary attention to detail in pitch books is annoying,” says one analyst.
3. Lack of client exposure: One analyst who spoke to us had been in the industry for three years, but was still desk-bound. Senior bankers deal with senior executives in industry, and juniors rarely get a look in. “Client exposure is fairly limited as traveling time is a luxury we have because we often switch from one task to another in a back-to-back fashion,” says one analyst.
4. Working hours: 70, 80, 90 hours a week are still pretty standard, suggest the analysts. Saturdays off is one thing, but the hours in banking are still very intense.
5. Unpredictability: A good junior investment banker must be prepared for the unexpected and is at the beck and call of their seniors and client demands. “Anything can happen at any time of the day or night and readiness is key. Meetings, especially between very senior people are rarely booked well in advance and always end up requiring brutal hours and dedication for the completion of the materials or analysis ahead of the deadline,” said one.
6. Volume of clients: Juggling various clients at the same time and working on transactions back to back means that the number of clients can be overwhelming for junior bankers. “Good deal flow is motivating, but the sheer number of clients we’re expected to cover is difficult,” says one analyst.
7. Rigid hierarchy: Investment banks say they want to hire entrepreneurial millennials, but they breed automatons. “Analysts easily fall into the trap of just doing what they are asked, which often results in engaging in very repetitive work that pleases their bosses immediate needs,” said one analyst. “Few question the dynamics, the reasons behind meetings and corporate actions or market movements.” This is actually seen behaviour to be encouraged in the first few years in the job. Unfortunately, when analysts move up the ranks and need to be more self-sufficient, many fail, he said.