Code user group blog: Investment Banking

Apologies for the slight delay in postings a summary of the January user group discussions. We have been focused on the completion of the UK companies house data project (more on that soon!).

In the January user group we focused on the role and remuneration of investment bankers.

Given the level of their remuneration and career trajectory, investment bankers are often a core focus of prospect researchers. However, based on our data and insights, Investment bankers only typically become donors in the latter part of their careers. This is especially the case as those in the analyst to VP roles are often younger and focused on spending their money! As such developing relationships with them early (for example inviting them to undertake guest talks if alumni etc) is a good way of ensuring continued engagement.

Investment banks are focused on providing financial services to organisations (along with very wealth individuals). Therefore, their operations are significantly different to retail banks.

 As a reminder, bulge brackets investment banks consist of:

·      Goldman Sachs

·      JP Morgan

·      Barclays

·      Citi

·      Bank of America

·      UBS (who recently acquired Credit Suisse)

·      Deutsche bank (just!!!)

Whilst these are the most commonly recognised investment banks, those mid-tier banks such as Wells Fargo, Jefferies etc have considerable clout in financial markets and remuneration is often similar to that in bulge bracket banks, especially at the very senior levels.

Whilst there is no definitive list of investment banking operations, for the purposes of remuneration we have split activities in to 5 key areas by order of typical remuneration)

·      M&A

·      Underwriting

·      Sales, trading and corporate finance

·      Asset management

·      Research

When undertaking research on a prospect, being able to identify which of these categories an individual’s role Is focused on is important. We worked through a series of examples to support this identification process. We are here to help though if needed!

The career of an investment banker will usually take a fairly structured progression route, centred around progression every 3 years. Whilst some banks have different names the titles are typically:

·      Intern

·      Analyst

·      Senior analyst / associate

·      Vice president (VP)

·      Senior vice president (SVP)

·      Managing director (MD)

 It is important to note an MD is not a typical managing director operating at board level. Instead they are an MD of an operation  / unit etc and might lead a team of 10-20 staff. During the session we discussed the term role inflation in relation to this!

It is important to note that many will ‘top out’ their progression at VP level with only those who are seen as rainmakers progressing further.

The rest of the session we explored the need to review recent investment bank league tables (i.e. to identify which banks are doing well in the big ticket fee earning deals), along with going over the typical month and timing of bonus payments for the main banks (this can be seen in the slides circulated).

I hope this short recap provided a reminder of what was discussed and can be used as a quick reference point if needed in the future.

 Thanks,
Jon