What is investment banking?

[Omnipotence]

Sorry to bump this thread but I'm curious to know if instituitional banking is the same as IB.

[Omnidragon]

Insto banking is typically a much broader division in a bank, and can sometimes encompass investment banking. Sometimes they're separate - it's all about power play in an organisation that's all. Does the ib head of a particular division want to have the report through the insto head and can he resist it (ie make enough money) that he doesn't need to if push came to shove? Don't take the labelling too seriously.

[Omnipotence]

Okay thanks.

[gwenwiver]

The predicted "White Collar" recession may make a difference. Here are today's articles. Given that 9 countries in Europe were downgraded including France this is obviously to be expected

http://www.macrobusiness.com.au/2011...lar-recession/

http://www.abc.net.au/news/2012-01-1...2/?site=sydney

http://www.smh.com.au/business/bank-...113-1pzhx.html

and if we follow the US trends as we usually do there is this:

http://www.theaustralian.com.au/high...-1226240893899

[DaltonF]

A bit more of an 'abstract' take on the thread topic, and a little thing I mull over sometimes, is how we assume Investment Banking, and more widely the Finance industry as a value-creator. Obviously my thoughts aren't knew, as they have been echoed by Carl Fox in Wall Street "Stop going for the easy buck and start producing something with your life. Create, instead of living off the buying and selling of others." But what I mean is, Investment Banking is a 'Utility' and should be treated like one.

I mean Utility in the economic sense. for those that don't follow, like electricity etc. If we look at the industry, we see a strong innate oligopoly destined to be formed, as through amassing capital is the name of the game, barriers to entry cost a lot, and unless you have connections, if you try and start up a boutique, simply no-one would use you. Other evidence I interpret to support this is the whole GFC debaucle, comparative to the 'fun' times had by Enron employees when they were given free-range on control of California's power grid (resulting in the creation of artificial shortages).

So with that in mind, I tie it to the ACTUAL thread, to work for a Utility that is branded and treated as a value-creating industry, means;

A) You'll be in the corporate environment, which translates to a situation where to progress, you've got to knock the guy employing you off their perch.
B) You'll be performing actions that do not equate to anything of substantial merit. AKA the 120 hours weekly of Grunt Work. This is an issue when your only motivation is money.
C) Due to the repetitive, extensive and high-pressure (Try lasting when you get models wrong) nature of your work, you'll undergo a psychological abuse, which will then affect your cognitive and behavioural states, turning you into someone you may not likely want to be.
D) Due to the extensive amount of time you spend in this line of work, you'll develop skills and taste for little else, you will have no 'lifestyle'.
E) Finally, a more existentialist concern (which could be said for other occupations as well), your 'work' amounts to nothing, you won't be making a difference, if you quit, you will be replaced by someone just as hungry, you'll have no stories to tell your children (if you ever have any), you'll become isolated from others outside the industry as well, no one wants to hear about how your excel model predicted an IRR of 357%. Compare this to other highly paid occupations, say a doctor, people want to hear how you diagnosed and treated someone, saving their life, or a small anecdote about patients. Take television as the prime indicator, there is no Investment Banking dramas. So living with the fact that what you currently do will mean nothing may also get you down.


I truly believe that Investment Banking is far too glamorised, not the traditional way of 'it's amazing', but in the sly way, able to scoop up the top performers 'It's Amazing, but you have to be the best to get in'. The in-built exclusivity of the industry innately attracts people, and transforms the ACTUAL issues of the industry for employees, as 'challenges' that must be overcome.

[Newbie]

fml - we just lost 25% headcount last week.
all banks in hong kong doing the same soon. I can only imagine Australia will follow suit
its truly fucked up out there thanks to Europe

Good luck to you kids interviewing next year - going to be tough times.

[Newbie]

Oh also want to give you guys some pointers on interviews

- please doublecheck your spelling in EVERYTHING, cover letters, resumes, your application form, email correspondence. any spelling mistakes gets you knocked out.
- study up on the technical questions, its not hard, they are all over the internet, its the same questions every year. even if you dont know what it actually is, just recite the answer
- read up the financial newspapers 3-4 weeks ahead of your interviews, pretend you care about whats happening at least

despite the world ending as we know it, application volumes are still extremely high so the little things can make all the difference between a yes and a no
as a reference, i think we got about 5,000 applications, 1000 went through and landed on our desks, 200 were given phone interviews, 40 were given second interviews and we will hire about 15

[gwenwiver]

fml - we just lost 25% headcount last week.
all banks in hong kong doing the same soon. I can only imagine Australia will follow suit
its truly fucked up out there thanks to Europe

Good luck to you kids interviewing next year - going to be tough times.

Do you believe the new school leavers are aware that they are facing a far worse future with few jobs then ever before?

Looking at your statistics above(in #57) it appears that the message is not getting through. Wonder if the 5085 unsuccessful applicants for places at your firm finally found a job in the industry? Do you believe that the 25% who lost their jobs at your firm last week will find a job easily?

[Omnidragon]

Jobs have never been easy to find in HK, let alone good jobs and let alone in a down market.

Reality is life goes on, people will still get hired, people will still get a job somewhere. Getting in or missing out on something "high-powered" (whatever that means) like investment banking is not the end of life. One of my closest friends who missed out on a job in my grad year is now running his own hedge fund, calling his own shots, investing $m that most banking directors could only dream about. And he's 26.

[sauce2k]

where no life and huge bucks exists

[gwenwiver]

where no life and huge bucks exists

Not any more - if you read the newspapers

[seremify007]

This thread also highlights one of the glaring omissions in university statistics- the employment rate. Many unis, mine included, boasted of what % of people graduated with a full time job. Sounds great in the orientation week speech/presentations but when you think about it, most people do uni with the intention of getting a good job. Failing that, any job would be better than no job. So it isn't really such a surprise to see high % employability rates but without actually saying how many got the job they wanted. Yes there are supply vs. demand issues, and there's always a bazillion people wanting IB/trading/front office jobs relative to the few positions actually available, but it's just something to keep in mind when managing your own individual expectations.

[bismarck]

Hey seremify - great thread. Would appreciate your views on my situation. I've graduated with a Bachelor of Economic and Social Sciences from USyd. I majored in Government, and had ok marks, nothing special. This was largely because I spent the balance of my time at university developing my career. I now work in a Ministerial office as a policy adviser. I definitely feel that my interest in Government work is waning, and have been accepted into an M Comm (finance) at UNSW which I'll begin in a few weeks.

I'm relatively sure that I have an interest in investment banking, and would be interested in your views on my best approach to break into the industry. Without a commerce undergrad, am I wasting my time going through the regular recruitment process? I feel like I have a lot of the soft skills that would make me suitable for an IB position, and my current job has definitely taught me the work ethic, but that I'd be lacking the hard skills and experience to get me through the standard recruitment process.

Appreciate your advice.

[enak101]

I understand they work in finance, and I hear the word analysis used a lot with it. Is it like the stock market etc? Just a bit confused hah.

[iBibah]

http://lmgtfy.com/?q=what+do+investment+bankers+do

[sghguos]

LOL Ibiah you owned him.

[seremify007]

Merged threads- and play nice lads.

[seremify007]

The first link has some good links at the bottom actually: http://www.mergersandinquisitions.com/what-bankers-do/

[OzKo]

The first link has some good links at the bottom actually: http://www.mergersandinquisitions.com/what-bankers-do/

I actually ended up reading the pair of articles and needless to say, IB does indeed sound quite intriguing if you have a penchant for not sleeping.

[seremify007]

I feel better knowing I'm the accountant they mentioned- sure it's hard work but at least it's not what I do day in day out everyday of the year.

[Newbie]

Ozko you know who has it the best

Korean bankers - they are worshipped in korea (even if they are fat or nerdy looking). all of my korea team are dating actresses/celebrities fml.

you want a shot at that girl you have in your profile pic, be a banker.

[seremify007]

^ but what if he loses his job?

[Newbie]

^ but what if he loses his job?

the girl finds his replacement lol

[Omnidragon]

I'll tell you what's best. When you have almost 10 houses in Melb/Syd, a few apartments in HK, and maybe one in NYC soon, collecting rent with a view to building either a mini hotel in the former or acquiring a block of tong laus in HK and redeveloping it. You can sleep with almost anyone you want, except Fala Chen and Cathy Tsui.

[seremify007]

I'll tell you what's best. When you have almost 10 houses in Melb/Syd, a few apartments in HK, and maybe one in NYC soon, collecting rent with a view to building either a mini hotel in the former or acquiring a block of tong laus in HK and redeveloping it. You can sleep with almost anyone you want, except Fala Chen and Cathy Tsui.

baller.