Morning Coffee: The cost-effective finance course whose graduates earn $119k, and the sins of the past come back to haunt you at U.S. immigration

It looks like there’s a course where the graduates earn nearly as much as those from a top ten MBA program, but which only takes a year and (therefore) costs significantly less.  The Haas School of Business at UC Berkeley charges $79,920 for its Master of Financial Engineering Program, compared to $61,506 per year for its two-year MBA.  And the alumni financial engineers earned an average base salary of $118, 530, compared to $125, 227 for the MBA. In other words, the MBAs paid 54% more and only earned 5.6% more. 

There’s a catch, of course, and it’s hidden in plain sight in that word “Engineering.” The Master of Financial Engineering is the world’s number one finishing school for quants.  “Launch your career in finance, data science and technology”, as the course website has it, underlining that it’s oriented toward some of the most in-demand hiring sectors in finance right now.  Whereas the MBA suits talented generalists, if you’re going to do the Master of Financial Engineering you’ll need to be exceptionally good at coding and at mathematics.  

The level of mathematical expertise and work involved seems to be a bit of a marketing problem for similar programs worldwide. - The financial engineering degrees at places like St Gallen University are making a slow start in recruiting students.  People on the finance track seem to regard the techie stuff as a bit too difficult and too much like hard work, while genuine quants and natural mathematicians don’t always seem to be interested in doing a finance course when a hard science PhD might be more interesting and seems to be just as valued a hiring qualification (many of the top quant funds are a bit snooty about business school graduates).  Where these courses seem to excel is in taking bright and ambitious engineers who have realised that they like money and want a banking job without necessarily having to go through the standard investment banking analyst recruitment round.  

The hybrid financial engineering course might also help to deal with a longer term career risk: namely, that if you’re a “pure” quant who has come from a hard science background to work purely on algorithms and statistical programming, it’s quite likely that’s all you’re ever going to be.  And although quant trading is currently hot, it might not be forever.  When the market moves on, people with a bit more general financial expertise – and a business school alumni network behind them – might be better placed to keep their career moving forward to the next opportunity.  

Elsewhere, time was when the only thing you had to worry about when filling in an immigration form for the U.S.A. was making sure you didn’t accidentally tick the box for “Were you involved in any way in persecutions associated with Nazi Germany and its allies?”  But in the last couple of years, the rules have begun to be enforced significantly more strictly, and as of a few weeks ago U.S. immigration authorities are asking for social media identifiers so they can check up on you.  This can lead to some awkward situations; in order to qualify for the visa waiver program, British bankers have to affirm that they have never “possessed, used or distributed illegal drugs”, which can be a difficult claim to support if the guy at the desk has access to your party photos on Instagram. “If banks checked “drug records” many traders would be jobless,” one trader at a large U.S. bank tells us. 

There’s no concept of a “spent” criminal conviction for US immigration either – an old drunk driving offence, or an police caution for youthful high spirits in your college days can also be taken into consideration.  Although a past indiscretion doesn’t necessarily bar you from ever being allowed to visit North American clients, getting found out for fibbing can turn into quite a nasty situation.  As a result, a number of people have been quietly approaching immigration lawyers, to see if they can smooth things over, rather than having to work the whole thing out in front of a tired crowd at JFK. 

Meanwhile … 

MBA graduates need every cent of their 5.6% salary premium over financial engineering grads; half of them are leaving business school with six figures worth of debt. (Bloomberg) 

There were 25 cases of bullying and harassment reported at the Bank of England between 2009 and 2019; the regulator’s HR department is having a review to see if there’s anything in particular that’s going wrong. (Financial News) 

New start up wealth management firm Azura is looking at the top end of the top end of the market; it’s only targeting billionaires.  Run by former Julius Baer and Credit Suisse bankers, it’s opened up in Monaco, where else? (Bloomberg) 

Controversial comedy auteur Lena Dunham is filming a new TV series about twentysomethings trying to break into the world of international finance.  It’s filming in Cardiff, which is presumably being used as a cheap stand-in for a more recognisable financial centre?  (Dealbreaker) 

An interesting thought for the long term; although there has been huge hiring in AI and compliance over the last few years, eventually the compliance issues will get solved and the robots will get built and then … most of the people hired during the great boom will be redundant, won’t they?  Nordea and Danske Bank (who both might be considered brave for talking about cutting compliance staff right now) both think so (Bloomberg) 

The iron law of bank HR is that turnover begets turnover; another senior fixed income salesperson is leaving Bank of America (Business Insider) 

Citi is merging its rates and currencies desk, as Paco Ybarra starts to put his stamp on the investment bank (FT) 

An interview with Tidjane Thiam, where he claims to have inspired Credit Suisse’s compliance staff with an analogy about his (presumably fictitional) cow called Geraldine. (Euromoney) 

Have a confidential story, tip, or comment you’d like to share? Contact: sbutcher@efinancialcareers.com in the first instance. Whatsapp/Signal/Telegram also available.

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