[D i g i S y n c]

Hello all,

I must mention that I have read all the threads on Investment Banking. I have read most of the posts by people who have posted a lot about the same. I've used the search option too. I just want to discuss the below given points with people who are really interested. I'm trying to make no mistakes but forgive me if you guys find anything wrong and help me improve.

Investment banking (FO - Front Office positions) is like a dream career for millions but very few get in there. Regarding Investment Banking, do you guys think it is just impossible to get FO positions, even for most of IIT/IIM guys? Past two years or so I've been reading a lot about Investment Banking in U.K. and at times I find things weird when we compare all that with India.

About Investment Banking (F.O. positions) in the U.K.

• Few top Investment Banks accept A level (class 12 equivalent in India) students and let them work in one or more than one of their teams. These students don't really do any number crunching but they are given a 'proper insight' into the industry. Then people are surprised when these 15-16 year olds talk about M&A, portfolio management, prop. trading etc.
• They also accept university students during their undergrads. Students actually work with the seasoned bankers. Just imagine how much exposure they get at the age of 17-21.
• Most of the students who get a full time offer for entry level F.O. positions have done atleast 1 or 2 internships during their undergrads.
• Top hedge funds pick students doing their masters for entry level positions. These funds are not overstaffed like the Big 4's. In some cases employees work 20 hours a day. Guys I won't lie, but that is the fact. You slog and you can make a lot of money. You lag behind and you'll be fired. Hedge fund jobs as usually considered as highly rewarding but very risky.
• Banks give priority to students from Oxford, Cambridge, London School of Economics, University of Warwick, London Business School etc. But even students from outside the top 10 can make it to the IB's.

About Investment Banking (F.O. positions) in India.

• Can't even think of accepting any class 12 students.
• Do not accept university level students until they complete their graduation.
• Internship is usually for IIT/IIM/ other top B School students who are about to complete/have completed their MBA.
• Accept students only from IIT's/IIM's and other top global B-Schools for full time positions.
• Post-gradation from a top B School is like a necessary evil.

About students from top B Schools from India who get into the top IB's abroad.

• 'Very few' (which I believe are the toppers) make it to London, NY and other dream cities.
• If I'm not wrong they usually get into research, quants and other departments where talented Indians are needed to do all the number crunching. These positions can't be called as the F.O. positions right?

My telephonic conversation with some interesting people from the HR department of some of the leading Investment Banks and Boutiques in Mumbai. This was possible only after calling each bank for some 10+ times. In some one or two cases it was easy.

Conversation 1:
Me: Good morning madam, is this the HR?
HR: Yes tell me.
*terribly excited as if I've won some gold medal at IIM-A. It's silly I know but I was really very excited.*
Me: I've read your website in detail but still I do not find answers to few questions. Is it okay if I ask them to you here or send an email to you? Will hardly take some two minutes.
HR: Sure, go ahead. But what is your qualification. Are you a CA?
ME: No but I'm still pursuing my graduation and would like to know about Investment Banking. Especially about few things which no website is ready to explain.
*HR was somehow not interested by then*
HR: Do one thing. Upload your C.V. on our website and the concerned department will get back to you. Take care.
ME: Madam, one sec but I'm not eligible for a job. Still 3-4 years for me to start working full time.
*HR this time was really annoyed I guess*
HR: Mr. XXXXXXX we only take students from 'top' IIMs and 'top' IIT's freshers for our operations in India.
*Now they want to have some competition among the IIT's/IIM's. Like IIT-B and IIM-A are the best. *
ME: Any other B School?
HR: No, not really. We also take C.A's for our investment banking operations.
*end of convo*

Conversation 2:
This was really interesting. I was trying from some two months to speak with an HR. I knew her name but she was never present in her office. I guess they are just over loaded with work? In those two months that operator and me almost became friends. Yes I called some 100 times. Few times she said, "God, I don't understand why these people don't stay in their offices'. I really liked it when she said that. She then asked me what work I had with her. I said, the same. Just some questions about Investment Banking as a career. I want to decide about it from now itself because I don't want to regret later for not preparing anything in advance. She smiled ( I could hear that!) Okay she said. Then after some 5-6 seconds she suggested me some other name. A person from the HR department itself. I'll connect you to her cell. NOOOOOOOO. Please don't I said. She said that I had a good reason and it shouldn't be a problem. She also said that I wanted to speak with the right person about the right issue. But still I was not sure if that would look good. I said okay. She then connected me to the concerned person.

HR: Yes?
ME: Good morning. This is xxxxxxx.
HR: Okay, what can I do?
ME: I'm a student and......
HR: Are you looking for a job? Find the email id for careers from the website and email your CV.
ME: No, I'm not looking for a job. This was actually about the investme......
HR: *before I could finish anything properly* No we do not have any positions in the investment banking division (IDB) as of now. But send your CV.
ME: Ma'am I'm trying to explain to you that I have some doubts which an HR could answer properly.
HR: I think xxxxxxxxx you should atleast be an MBA/CA from top B School really. That helps. First complete your graduation. Still a lot of time for you.
*This HR was really good but she kept thinking that I'm just asking her for a job. I was going to say thank you for your help and then hangup. But then I won't get a chance to speak with her again. I knew that. I managed to ask one more question!
ME: Apart from IIT's/IIM's which other......
HR: No sorry, there are no positions in IDB.
*I thought she is not really interested at all*
ME: Thanks a lot ma'am.
* end of convo*

I remember I banged my receiver after that. I was seriously depressed. Had no one to ask all those questions. I thought that I won't go to IIT's/IIM's. Even if I go what's the point? But still I had to thank the operator who let me connect to the HR on her cell!!! She really was curious if I got all the answers. I didn't want to say no and bother her anymore. I said yes, she answered me. I sounded different and she said ok xxxxxxx I hope that is true. I know you are focused and trying hard for it. All the best!!! Those lines made me smile. I said in mind I wish you were in her (HR's) position.

I had many such telephonic conversations but as I had no personal contacts nor the IIT/IIM tag. As expected, I couldn't really speak with them in detail. I do not blame them and I have no complaints at all (in reality I feel like screaming at times for not listening properly and for not doing what an HR - careers/campus recruitments is supposed to do) But for sure I know that Investment banking activity in India is very different from that in the U.K./U.S. Which is one reason I want to go abroad for my PG. The finance sector is so vast that one really has to spend some time researching each and every sub-division and then think what is best for him or her.

Please share your thoughts on the above mentioned points. Here in India they give so much stress on the technical details. I know a guy (not personally) who did Geography from Oxford but now works in the Sales and Trading department in a leading Investment Bank. (The one which rules in derivatives!!!) It's all so different. I'm not asking any specific questions but I need to know if you guys agree with what I mentioned. It will be great if you people continue discussing.

Cheers!!!

[BaBu]

Well, UK is a developed economy producing $ 2 trillion in output using 55-60 million britishers.

India is a developing economy producing $ 4.3 trillion in output (PPP basis) using 1200 million indians.

A country like UK with a per capita income of approx $ 28,000 will have more opportunities in every sector as compared to a country like India with a per capita income of $ 3300 (PPP basis).

In India, there are limited investment banking jobs and unlimited applicants. Hence firms can be choosy and top jobs go to IIM/IIT.

In Australia, if you complete a 3 year b.com course it is considered as an achievement and you will be considered for jobs in banks, accounting, finance etc.

Now compare to 2 million ordinary B.com graduates which India produces year after year. Thanks to outsourcing and GDP 9% growth, some of them are getting employed.

This is the reason MBA is a religion in India- Limited opening, many applicants so India 1000 business schools are churning MBAs year after year thus pushing ordinary graduates behind.

If you have funds arrangement and a university offer letter, you should definately move abroad to persue IBs opportunity.

God bless reforms, we are uplifting 20-25 million indians every year out of poverty with 8-9% growth but i have done a simple calculation which shows:

In about 34 years from now, India will have almost same per capita income as singapore is having today. I have taken singapore growth as constant but even singapore is marching ahead with 3-5 % growth, so you can imagine at that time singapore will still be earning more however the gap will reduce.

Anyone migrating to UK/singapore/ canada, in one stroke of life, shifts from a developing country growing pain to a developed country 'benefits'. It is indeed tough to get settle initially in a foreign but over long term it pays.

And coming to main point, i agree with your article word by word. You have posted a reality situation !

[D i g i S y n c]

Nice post BaBu and thanks for the concern.

What you said about about opportunities in Investment Banking (IB) in India is right. There are very few IB's but unlimited number of applicants. But won't you find the same situation in the U.K. and even in the U.S.? Which also means that they should be very picky too?

When we talk about careers in IB's in the U.K., we usually think of London. That is the place where most of the Investment Banks/boutiques are located. There can be some 10-100 students applying for 1 single position. Quite possible. If you think this way, it's still the same in India, U.K. and the U.S too. A large number of applicants for any given position.

Worst part is that freshers applying for entry level positions are usually our Indian graduates from IIT's/IIM's. Good for them that international students don't apply for those positions. This aint the case abroad. We find students from all over Europe, Asia and even few from the States applying for U.K. based firms. I think that there are more number of applicants per place for U.K and the U.S based IB's/boutiques. Thus, they obviously can be very picky and stick to the top 10 universiteis/B-Schools. But they don't. They do accept students who are capable but are from out of the top 10.

In India, like I mentioned before, comparatively there are lesser number of applicants per position. Banks still prefer to be picky. Shouldn't they change their approach and give others a chance too? When I say others I do not mean sub-standard students at all. But the ones who really are capable but do not have the IIT/IIM tag.

Few IIM/IIT students make it to IB's/boutiques abroad. Anyone who would discuss about the divisions they get into? Also about their life 3-5 years after joining? I have some idea and have also read about life of IBankers in any given department. But would like to know about our Indians going abroad.

Cheers!

[anandv]

If I'm not wrong they usually get into research, quants and other departments where talented Indians are needed to do all the number crunching. These positions can't be called as the F.O. positions right?

If you as an employee are working in a market where you talk to clients, visit company locations, attend analyst meets, meet top management of companies, that position will be in capacity of front office. So if you do equity research-sales-trading in Indian markets, that will be front office. So front office-ness has more to do with the market location rather than the position.


Coming back to your point, Now the problem with India is our narrow-minded mentality about graduation stream. We are reinforced by parents in 12th standard that engineering is the way of life, a pathway to earn a safe and secure job. And if we get into any other stream like arts, science, commerce, we will be big losers, we won’t get good jobs etc.
So the result is that every a$$hole aspires and gets into engineering. So the thing is that here, all the brilliant people end up in engineering and the people in other streams are relatively not-so-good.
Now this is not the case in foreign countries where courses like economics, commerce are extremely valued. So this results in equally brilliant people getting into non-engineering fields.
So when IBanks go on recruiting in India, they find people like: fresher engineers or engineers with IT workex. Now given this background, it is safest bet for the firm to hire IIT/IIMians. In my viewpoint, 50 out of 100 guys should be good in II* but only 5-10 Guys/100 will be good in say BA Geography course in Mumbai univ. Having said that I do not necessarily mean that non-branded schools’ people are not good. But taking the viewpoint of IBank, it is their safest bet to hire someone who has historically proven their capabilities rather than taking a chance against BA guy. Also there will be 1000s of BA geography guys, and interviewing them to find the diamond will be extreme waste of money and time. Compared to that II*s and ICAI present pools of smart people to the companies so that 25-30 potential candidates can be quickly assessed in 1 day without extreme waste of time and money. So generally Banks prefer going to II*s or CA rankers.
Ofcourse, these days banks have found new arsenals of talented pools and have started going to Stephens, SRCC,DSE etc. But yes, BA geography guy will need some more yrs!

[D i g i S y n c]

Originally Posted by BaBu

If you have funds arrangement and a university offer letter, you should definately move abroad to persue IBs opportunity.

I had missed this. I do have some good offers from universities in England. But not sure if I'll go. Few IB's always pick students from those universities. I hope that I get a chance to move abroad this year!!!

[D i g i S y n c]

Originally Posted by anandv

Coming back to your point, Now the problem with India is our narrow-minded mentality about graduation stream. We are reinforced by parents in 12th standard that engineering is the way of life, a pathway to earn a safe and secure job. And if we get into any other stream like arts, science, commerce, we will be big losers, we won’t get good jobs etc.
So the result is that every a$$hole aspires and gets into engineering. So the thing is that here, all the brilliant people end up in engineering and the people in other streams are relatively not-so-good.

So true. Same thing happened with me too. But I decided to go against the system. It was just so difficult. My parents are still annoyed but they still try to accept what I've done and support me. At times those things come up randomly but still I do not regret for what I've done. I quit my course but that was done after a lot of thinking. Still people didn't like it at all. Well, it's the culture here. I had to move on. I did.

Also there will be 1000s of BA geography guys, and interviewing them to find the diamond will be extreme waste of money and time. Compared to that II*s and ICAI present pools of smart people to the companies so that 25-30 potential candidates can be quickly assessed in 1 day without extreme waste of time and money. So generally Banks prefer going to II*s or CA rankers.

Well thats right. But from few years banks have been accepting online applications. Campus recruitment is totally different. Most of the students applying for internships apply online. All the websites are very dynamic. They have auto filters which reduce a lot of work. The banks can ask for your scores at class 12, graduation and at post-graduation. All the candidates who have below 60% can be auto filtered. They do not qualify for the next rounds. Such things are done. I read an article written by an HR. She clearly mentioned that it's a fact that all the students apply for more than one bank. Thus students have to manage multiple CV. They have one CV but a number of covering letters for a number of banks. Our usual copy-paste operations. Interesting part is that there are a large number of applicants who apply for say, The Deutsche Bank but they address it to Morgan Stanley or some other bank. Such applications get rejected. Surprisingly 'many' students write wrong date and get rejected.

Anyway, I hope that firms here open up for other schools/universities too! II* guys are doing a fantastic job already. But I'm sure 3-5 years after they start accepting non-II* people they will benefit a lot from what they've done.

Cheers!

[willsurelywin]

as per internal news investment banks wont be recruiting this year due to subprime ....

infact some have even sacked employees ....

i bank work has fallen 35% as vs last yr and no chnaces of revival in sight:2gunfire:

[D i g i S y n c]

Originally Posted by willsurelywin

as per internal news investment banks wont be recruiting this year due to subprime ....

infact some have even sacked employees ....

i bank work has fallen 35% as vs last yr and no chnaces of revival in sight:2gunfire:

Very true. But no more some kind of an internal news mate. A guy I know was a fund manager based in Japan. He told me the same thing some 6 months back. Could be a short period or few years. No one really comments on how long these financial crisis will last. In 1997 financial crises, took around 6 years to recover. George Soros said that this time the crisis look even worse. :(

Thanks for the reply

[fIrenzze]

Originally Posted by anandv

[COLOR=black][FONT=Verdana]
Coming back to your point, Now the problem with India is our narrow-minded mentality about graduation stream. We are reinforced by parents in 12th standard that engineering is the way of life, a pathway to earn a safe and secure job. And if we get into any other stream like arts, science, commerce, we will be big losers, we won’t get good jobs etc.
So the result is that every a$$hole aspires and gets into engineering. So the thing is that here, all the brilliant people end up in engineering and the people in other streams are relatively not-so-good.
Now this is not the case in foreign countries where courses like economics, commerce are extremely valued. So this results in equally brilliant people getting into non-engineering fields.

i completely second that.....infact i have a distant cousin in U.S who did his grad. in economics from dartmouth and got an offer to work with blackstone pvt. equity,among other big names. Blackstone recruited 4 ppl frm his univ. out of which 1 was co-incidently a geography graduate

but then i think the situation has started improving for non-engineers and so has the mindset of the bourgeoisie

as far as inv. banks are concerned, they have started visiting the top commerce and economics colleges....infact lehman bros gave an offer of a whopping 14L to 13 graduates from stephens and srcc, while HSBC gave 15 lacs at LSR

Companies like monitor consulting,bain capital etc have also started recruiting, though their recruitment is restricted to the top colleges only

[krishsuraj]

The "whopping" 13L CTC salary being given by Lehman is not for the same job as being given for under grads in the US. Its in the KPO arm of Lehman brothers. So the situation is still the same in India. A geography grad would still find it extremely difficult to get into a top notch IB in India...

And IIM grads who get hired for foreign IBs get hired for the same job as a MBA grad from US B-Schools except that they join as a 2nd or 3rd analyst, though some have even joined as Associates this year, which is the entry level for US MBA grads. Since Indians tend to do MBA without work-ex, these guys dont stand to lose much in terms of years of work ex...

And regarding why IBs prefer IIT/IIM grads, I would go with anandv 's reasoning, ease of selection!!!!!

P.S:- IBs are one place where HRs are treated with scant respect and dont play any significant part in hiring unlike in IT companies where they r revered