What is the process for getting hired in Investment Banking?
An analyst or associate position in investment banking can be one of the most competitive jobs to secure upon leaving undergraduate or graduate studies. The process to position oneself for either an internship or full-time position can take several months to years and can involve internships, research, networking, and compiling the proper coursework. The interviews, which can be difficult to obtain, are very challenging both mentally and physically as they often stretch over several hours. Overall, thanks to the growth of the private equity and other financial sectors, there are more opportunities in finance for new candidates and similarly, there are many more resources available to help prepare.
Key Learning Points
• Key factors for success in getting hired in investment banking include a strong university pedigree, academic excellence, relevant internships, networking through alumni and diversity organizations, and demonstrating quantitative aptitude.
• The recruitment process includes multiple rounds of interviews, the first round is often on campus or virtually, and subsequent rounds involve in-depth Superdays with multiple professionals from the bank.
• Successful candidates receive offers with a salary, possible signing bonus, and a deadline to decide. When making their decision candidates may need to weigh different offers.
Key CV Points to Note
- While not exclusively important, a university pedigree is a key driver of hiring success rates
- Top academic performance in conjunction with well-rounded campus and community activities makes a candidate stand out in a large applicant class.
- Internships can be critical for full time hires.
- Networking through university alumni, family and friends, diversity organizations, etc. is one of the best ways to guarantee an interview slot.
- Business degrees or coursework is not necessary but extremely helpful: regardless, quantitative aptitude must be demonstrated.
How to Get a Job in Investment Banking
The Recruitment Process
- The first round interview is usually conducted either on campus as part of a formal recruiting process or one-to-one with a bank representative from the banking division or human resources
- Subsequent rounds of interviews are lengthy and often part of Superdays where candidates are interviewed back-to-back by multiple professionals at all levels of the bank
- Offers made will often be “exploding” meaning that a decision must be reached in a certain period of time
Laying the Groundwork
Ideally, every full-time applicant will have a related finance internship or possibly two before applying for a position in Investment Banking. Many full-time roles will be filled prior to the start of recruiting season with interns that have been asked to join full time. Obtaining an internship is statistically more difficult than a full-time position due to the smaller number of slots. The process for obtaining an internship in investment banking mirrors the full-time process. Even without an investment banking internship, one can still pursue a full-time position in the field.
Investment banks target certain schools and universities for recruitment. A key point is that the schools are considered targets because of the number of successful alumni at the bank. Bankers will tend to form recruitment teams of alumni at the bank to compete on campus for top candidates. The list of target schools has grown over the years. Therefore, if a candidate is not studying at a target school, identifying and networking with successful alumni in banking can be essential. Even for applicants from target schools, the competition for interview slots on campus is intense so networking and positioning oneself is necessary.
The Banking Resume
We have included here two examples of resumes – a good and a bad version. The good version is crisp, succinct, and leads the eye from well-chosen highlight to highlight. The bad version is bland, wordy, and uninteresting. There are many examples of good and bad resumes on the internet as well as resume workshops. It’s a good idea to circulate your resume to professionals and ask for constructive feedback before submitting it to your top choices.
As mentioned, university pedigree is important. However, a strong resume will always consist of exceptional academic performance, demonstrated teamwork and leadership skills, related work or internship in finance, and character well-roundedness via extra-curricular activities and/or community involvement. Financial coursework at school is not necessary but helpful. There are also great online resources, with some providers even offering micro degrees and certificates of completion that can help fill gaps in financial knowledge.
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The Interview Process
Initial interviews tend to occur on campus for targeted recruitment schools. For candidates outside those target schools, the initial screening may be virtual or possibly in the office depending on the candidate’s proximity to the bank. The first round of interviews will probe a variety of areas such as personality, knowledge of the position, knowledge of the bank, and quantitative aptitude.
The first round often consists of two separate interviews: one with a human resources professional and another from the banking team. Interviews are approximately 25 minutes throughout the process. Candidates with strong resumes, work experiences, and strong interview performance will be asked to a second round, often called a “super” round. Every firm is different in terms of how they handle this process.
Super rounds, sometimes called ”Super Saturdays” are all day affairs with each candidate meeting with a slate of interviewers, all from the various banking businesses. The interviews will cover similar ground as the first round, however in much more detail. Each interviewer will handle a specific area for the entire interview. Candidates will be asked to explain their relevant work experience, team building/leading activities, demonstrate knowledge of the firm and banking position, and prove their quantitative/problem solving ability.
Questions can range from theoretical to specific. Candidates that have strong coursework in finance will usually be tested on their knowledge of finance, such as explaining a DCF or enterprise value etc. Non-business majors will likely be tested to see if they have attempted to research the job content. They may be asked “how would you value a business” or “what are different ways to raise capital”. Along with getting to the correct answer, the interviewer will also look for problem solving skills and ingenuity in tackling a difficult problem.
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Find out what to expect from the interview process, how to tackle tough questions and watch an example of a successful interview, including questions and answers.
After the “super” round of interviews, the interviewing teams meet to discuss their choices. Once final decisions are made, the firm will contact each candidate with an offer, a salary and possible signing bonus, and a deadline to decide. Individual firms will handle these offer components differently: some firms hire everyone as generalists and then make division assignments later.
Others hire directly into a business group. At this point, a candidate with an offer will have a limited amount of time to decide. This often includes weighing an offer from a top firm in a group that is not the candidate’s first choice, with an offer in the desired business group, but at a firm that was not the first choice. For those who have been through this challenging process, having any offer at all is something to celebrate.