How Does Investment Banking Recruiting Work？
Investment banking is a highly competitive and popular field. Investment bankers are expected to help clients raise capital to fund their activities and expand their businesses as well as act as corporate financial advisors.
During the investment banking recruitment process, banks screen and interview candidates to extend offers for internships or full-time positions. Ideally, applications and informational interviews should begin 3-6 months prior to the beginning of recruiting.
Key Learning Points
- There are different types of recruiting in investment banking: Internship Recruiting, Full-time Recruiting, and Off-Cycle Recruiting.
- An internship is a steppingstone but an important prerequisite for a full-time offer.
- When applying for a role in investment banking, it is important to understand the requirements of the position. Your resume should be consistent with the job description.
- Investment banks use filtering software to sort large volumes of applications and therefore it is important to highlight related keywords and phrases.
- It is possible to break into investment banking after graduating and working in a different industry. Advice on changing careers often recommends getting an MBA or seeking internships and positions in finance.
Different Types of Investment Banking Recruiting
Internships: Many of the top banks, including Goldman Sachs, J.P. Morgan, Morgan Stanley, and the RBS Group, offer summer internships in investment banking. On-the-job experience and practical skills training can provide would-be bankers with the perfect foundation for an investment banking career. The best-performing students may receive full-time job offers after graduation.
Full-time: Once upon a time, it was easier to get a last-minute job in investment banking if you had good grades and went to an Ivy League university. It was only when full-time recruiting began that many students became interested in finance and competed for on-campus interviews. In the past decade, that path has become less viable. Summer intern recruitment at investment banks has become much more competitive, with recruiting starting earlier and full-time non-intern recruitment close to “endangered species” status. If you don’t get a summer internship offer, it will take longer to get into the industry.
Off-cycle Recruiting: If you have graduated from university, graduate, or business school and find yourself behind the curve, it’s a good idea to target small and mid-market investment banks, which may still consider you for a lateral role.
Recruiting Pathways into Investment Banking
Undergraduate and Internship Recruitment
The standard route for investment banking begins with an internship during the undergraduate years. Although it’s not entirely necessary to be a finance major, it’s important to have a strong foundation in math and knowledge of economics or business/management. This is the easiest way to break into investment banking, and it’s important to consider how your undergraduate coursework can help before applying to related positions. Moreover, given that recruiting starts so early, competition tends to be fierce, making it extremely challenging to secure internships and entry-level jobs in investment banking. It’s essential to decide early on that you want to go into investment banking and start preparing to stand out in a highly competitive group of candidates.
Graduate (non-MBA) Recruitment
As a graduate student, you will still apply for entry-level analyst positions, so the application process is much the same: apply for internships as early as possible before graduation or accept a position related to investment banking after graduation and move into investment banking from there.
MBAs Route Recruitment
If your undergraduate degree doesn’t provide a strong academic background in economics, finance, or quantitative methods, or if your full-time work experience is not finance-related, an MBA may help you on your way to a banking career. To break into the industry, it’s important to enroll in a top-ranked MBA program. Attaining the CFA designation may also give you an advantage. If you are looking to get a head start and receive the same training as new hires at the top 4 investment banks, enroll on our online investment banking course.
Career Change Route
While the routes above are the most common, it’s still possible to break into investment banking after graduating and working in a different industry. Advice on changing careers often recommends getting an MBA or seeking internships and positions in finance. If you’re well beyond the MBA level, for example, if you have more than 10 years of experience and are at the senior executive level, you may be able to move into investment banking based on industry experience.
Where to Start
Whether you are looking to break into finance or change roles, enroll on The Investment Banker and receive a Wall Street recognized certificate along the way. Develop practical skills you can use to impress in interviews. The course covers accounting, financial modeling, valuation, and M&A and LBO analysis.
Investment Banking Recruitment Timeline
The investment banking recruiting cycle varies from bank to bank but usually comes at the same time each year. Most investment banks recruit, interview, and hire full-time analysts in the fall of each academic year. And an increasing number of full-time job opportunities are going to applicants who participated in internships the previous summer.
Undergraduate and MBA summer internship interviews usually begin in January. Some banks open their summer analyst applications before September, so you’ll need to start looking in July and August to see if applications are open. Internship applications are usually due in mid-to-late November through December, but banks often hire on a first-come, first-served basis, so apply as soon as possible after positions open. In the U.S. some banks have been known to close intern applications as early as July.
Ideally, you’ll get a place in a 10-12 week summer analyst program (internship) in the summer. Successful interns are likely to be offered a full-time position upon graduation.
In general, investment banks start full time recruiting for undergraduate and MBA students in August or September. Typically, banks prefer to fill their graduate programs with interns from the previous summer, so competition for remaining positions is fierce. Some banks open their graduate recruitment processes in July or earlier, so graduate job seekers should keep a close eye on recruitment websites throughout the summer. In the US, the usual deadline for full-time investment banking applications is October; In Europe, it could be November. Different companies stagger their recruitment processes, so graduate candidates may complete one company’s recruitment process in October, while others may hold off until December.
Small and mid-market investment banks have a less structured interview process. They usually hire on demand, so interviews at these companies can take place all year round. The timing here could best be described as “random,” which usually means that investment banks hire on an as-needed basis.
The Standard Investment Banking Recruitment Processes
- Internships are a steppingstone: As investment banks attach great importance to work experience, an investment banking internship at the undergraduate or MBA level is an important prerequisite for a full-time offer. If you have already completed an internship at an investment bank, you’ll have a better chance of success in getting a full-time job after graduation. Second, look at an internship as a long-term job interview. If you want to get a full-time job, you must do well enough to make the team like you.
- Prepare a resume: When completing a job application, it’s important to understand the requirements of the position. Your resume should be consistent with the job description. Make it stand out by highlighting your internship experience, skills, and relevant personal characteristics such as discipline, perseverance, attention to detail, etc.
- Networking: Once you have internship experience, a good story, and a solid resume, you should start networking as soon as possible to get investment banking interviews.
- Submit application: Investment banks receive thousands of applications from all over the country. One way they manage and sort the large volume of applications is by using filtering software, so you need to highlight related keywords and phrases.
- Online testing: Another key part of the application process is completing an online test administered by the bank. These tests are designed to measure candidates’ abilities in relevant areas.
- Assessments centers: The assessment center gives investment bank recruiters the opportunity to learn how candidates work in teams, solve problems, and fit into the organizational culture of the organization.
- Complete the interview process and get an offer: The final stage of the recruitment process will be a classic interview in front of a panel. Interviewers will want to get to know candidates better and test their technical skills and adaptability. Investment banking interviews are notoriously tough, so preparation is essential.