Tag Archives: investment banking recruitment

A new breed of banker?

26 Apr

 ‘Difficult but talented’ replaced by ‘Pedestrian but hard-working’.

A slew of regulatory reforms have made banks much safer places – Dodd-Frank in the US, and the Markets in Financial Instruments Directive (Mifids 1 and 2, as they are affectionately known) – have made it harder for banks to market and sell risky securities to ‘unsophisticated’ investors, and regularised professional trading standards to combat volatility.

But now that over-the-counter derivatives and so-called ‘dark pools’, where large trades can be placed anonymously without the onerous reporting obligations of licensed exchanges, have been strait-jacketed by legislation, is there any place for the dashing, risk-loving daredevil of popular stereotype?

According to eFinancial careers, which keeps a close eye on trends in the industry, the typical banker has become almost… boring.

“A lot of people who had successful careers – the most talented people of my generation – have left the industry to do other things,” Kerim Derhalli, the ex-Deutsche MD who himself has quit banking to head Invstr, a social network for amateur investors, told the recruitment firm.

It is certainly true that investment banking still pays the highest starting salary for graduate recruitments, according to a UK survey by graduate recruitment research company High Fliers. Their report, on ‘The Graduate Market in 2016‘, put the welcome package at investment banking firms at £47,000, the top-ranking sector, with banking and finance ranked third at £36,000.

Though the number of positions at banking and finance companies did not increase by even a quarter of the increase seen within IT & Telecommunications, which went up 219% compared to just a 37% rise in finance positions.

The High Fliers report recorded that “The number of entry-level positions available for graduates in IT & telecommunications and in the public sector has more than doubled over the last ten years, whilst recruitment at the top consulting firms has increased by two-thirds.”

This is corroborated by another eFinancial careers source, former head of rate sales at Deutsche Bank Chris Yoshida. “When I went into banking [in 2000] my graduate class was comprised of the best students from the best universities in the world,” said Yoshida, who now advocates for the Kairos Society, an organization that helps young entrepreneurs effect global change. “This is no longer the case – the very top students now want to work for Google and Facebook. Banks are attracting the students who are in the top 50% to 75% (rather than the top quartile).”

 

Even banking interns, such as those enrolled in the Goldman Sachs 2016 ‘summer analyst class’, which prepares those keen on a financial career in its inner workings before they have even graduated, have become less motivated by materialism.

Goldman Sachs, which has a spoof twitter account under the label ‘GSElevator… Straight to Hell’, reported on its blog that its interns were predominantly interested in saving to buy a house (46%), while just 3% wanted to own luxury items. I suppose it might come across as presumptuous before you’d even been offered the highly desired and competitive job to say ‘I just want a Ferrari’, but… the tone of the industry has definitely changed.

Perhaps this is partly due to the emergence of multiple sources of alternative finance like crowdfunding and peer-to-peer lending platforms; and alternative payment systems such as Paypal and now blockchain-linked crypto-currency mechanisms.

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