The students who spend years getting into banking - and then quit
Arjun Sofat badly wanted to be a banker. An economics graduate (1st class) from the UK's University of Nottingham, he completed three banking internships as an undergraduate and then got lucky. He joined the investment banking division (IBD) of a major European bank when he graduated. But for Sofat, the time he spent getting into the industry outlasted the time he spent working in it – within two years and eight months of becoming a banker, he had changed his mind about his career. And he is far from being alone.
“I can say with certainty that 80% of my analyst class have left,” says Sofat. “There is no one I recall joining with me who is still with the bank today.”
It’s a phenomenon most banks will recognize. While the banking industry has no problem attracting hundreds of thousands of students to apply for its jobs, keeping hold of them is an altogether different matter. For many highly ambitious and highly intelligent students, banking turns out to be no more than a career staging post – whether they intended it or not.
The exits are particularly pronounced in Sofat’s area – IBD. Like Sofat, one Goldman Sachs IBD associate estimates that over 80% of his analyst class left after a few years. By comparison, he suggests that the departure rate in securities is lower, at more like 60%.
The major reason for getting out of IBD is burnout. For all banks’ fine words and fancy strategies for cutting juniors’ working hours, the job remains a grind. “There were quite a few occasions where we would work for 24 hours non-stop,” says Sofat, who left banking in February 2017 – long after such practices were supposed to have been outlawed. “We’d get to the office at 9am and at 9am the next day we’d go home shower and then come back in again.I can remember feeling very excited when I got six hours’ sleep a night.”
Like most junior bankers, Sofat also has his share of stories about holidays being cancelled and friendships falling by the wayside. “The expectation wasn’t that you could take leave when it was convenient for you.” Facebook made things worse: "You definitely fet the FOMO looking at social networks and seeing what everyone else was up to."
What makes it difficult for banks though, is that hours aren’t the only issue. If they were, keeping juniors would be a simpler matter. However, for Sofat, as for the others of his generation who spent years jumping through hoops to get into finance only to leave once they arrived, it was also a question of fulfillment. They wanted it; for whatever reason they decided it was not on offer in a bank.
“I wanted to get back in touch with the creative part of myself,” says Glenn Regis, a former European government bond trader at Bank of America Merrill Lynch, who left 18 months after joining. When he looked around at his colleagues on the trading floor, Regis says he was struck by their wasted potential: “What we were capable of could be better used elsewhere.”
As with Sofat, Regis knew what he was getting into - or should have. He spent three months interning with BofA before joining full-time. He says he’s still interested in markets and “how things work”, but that after 18 months the mundanity of the menial work done by trading floor juniors was too much. “A lot of the people who go into banking are very intelligent but the work is just not very stimulating and doesn’t use their intelligence properly. I think I’m using my brain much harder and better after leaving.”
Regis left Bank of America in February 2018. He’s running creatyve, a crowdfunding website where artists can raise capital from investors by selling shares in their art. The site is due to launch this week and Regis expects some of his former colleagues to be among its supporters. “There are a lot of people on the trading floor who are looking at ways to invest their money – this can help them do that.”
Sofat too is targeting some of his former colleagues in an entrepreneurial capacity. Months after leaving banking, he set up Free Soul, a company offering nutritional supplements formulated for women. “My dad became sick and during that time my mum felt very low on energy. I started working with leading nutritionists to develop protein blends that are helpful to females” says Sofat. "A few of my friends are in finance and they are saying they really feel its benefits too."
While Regis and Sofat are no longer in banking, neither begrudges the time they devoted to pursuing their lapsed finance dream. "I worked on the trading floor for almost two years and it was good," says Regis. "M&A teaches you a great work ethic that you can take elsewhere," says Sofat. "I have no regrets about working in IBD. What I do regret is all the coffee I drank while I was there."
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