Alternative routes into investment banking

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Your rejected application need not be the end of the line. There are oher ways to get your foot in the investment banking door.

Investment banks' graduate training schemes are heavily oversubscribed. With over 40 candidates applying for each graduate-level job, according to the Association of Graduate Recruiters, there's plenty of room for disappointment. However, a rejection by one bank (or even six) need not be the end of your investment banking odyssey. If you're prepared to bide your time, there are alternative routes into the industry.

Become an accountant ...

While investment banks typically close their doors to graduate applications in October or November, the so-called Big 4 accountancy firms continue welcoming applicants into spring and beyond. "Recruitment is typically from April to May," says Hélène Ratte, human resources (HR) director for Europe at Deloitte Touche Tohmatsu. "But it's never too late to apply."

James Heath, managing director at recruitment firm Greenwich Partners, specialises in placing newly qualified accountants into investment banking roles. He says most go into equity research, corporate finance, and private equity: "Right now, the chartered accounting qualification is an excellent springboard to a front office position in an investment bank."

To make the transition into banking, accountants will need first-time ACA passes, a 2.i degree and exemplary A'level passes, says Heath. Those with less glowing qualifications will find it hard to penetrate the glamorous (and well paid) jobs in the front office: "If you have a 2.2 or you don't pass first time, you'll probably have to work in product control or financial control, which are more standard accounting roles."

Heath says the best time to move is straight after qualifying. But banks have been known to take accountants with two or three years' post-qualification experience. In the interim, he says it's best to work in a corporate finance or corporate restructuring role at an auditor.

... or a strategy consultant

Organisations such as Accenture, McKinsey & Co., Boston Consulting and Bain & Co. are established hunting grounds for febrile financial services firms looking to fill gaps in their ranks of experienced junior staff.

The bad news is that jobs at these firms tend to be highly prized themselves so, if you can't get a job in an investment bank, your chances of succeeding in strategy consulting may be minimal too.

Take an MSc ...

Another option is to study for an MSc, and re-apply a year later. There are several organisations offering MSc courses with a financial services focus, and most will take students straight from a first degree course. Not all are well regarded by banks, however. Some of the best respected include the London School of Economics, Imperial College, Warwick University, the Cass Business School, and the ISMA Centre (part of Reading University).

Be aware that even an MSc from a respected school will not always transform your investment banking career prospects, however. Vivienne Bradley, head of European graduate recruitment at Merrill Lynch, says MSc students will still need the same underlying competencies, such as strong communication skills and teamwork, as first degree university applicants. If your initial application is unsuccessful, it is, therefore, worth finding out why, says Bradley. An MSc will not necessarily make you any more appealing.

Even if a bank does accept you after an MSc, you'll start in exactly the same place as if you'd joined straight out of a first degree students: as an analyst. If you want to start in a more senior position you'll need to study an MBA.

... or an MBA

Students on Masters in Business Administration (MBA) courses usually have a few years' prior work experience. MBAs cost tens of thousands of pounds to do, but will buy you another bite at the investment banking cherry - banks hire a few hundred MBA students every year as associates (one notch up from analysts).

As with MSc courses, however, you will need to choose your MBA school carefully. Ever the elitists, banks prefer to hire from a handful of top schools, including Harvard, and Wharton in the US, and the London Business School, INSEAD in France, or IESE in Spain.

Equipped with a top MBA, even the most unlikely people can cross over into banking careers. For example, Mike Aitkenhead, a former intensive care doctor from New Zealand, moved into an equity research career at Baird, the US investment bank and asset manager, after studying an MBA at the Judge School of Management at Cambridge. He said money was part of the appeal, as was an affinity for scrutinising balance sheets.

An MBA is not, however, a panacea for the pain of investment banking rejections. Off the record, banking recruiters confess they prefer MBA students with some prior experience of the industry.

Alternative travellers

Alex Hay joined Close Brothers, the independent merchant bank based in London, ten months ago from PriceWaterhouseCoopers (PwC), where he was an auditor in the consumer and industrial products division. Alex is now a corporate finance executive.

"After I gained my Association of Chartered Accountants (ACA) qualification, I started receiving a lot of calls from recruitment consultants, offering plenty of roles for newly qualified accountants in investment banking and commercial finance. I followed my interest in investment banking. In my experience, accountancy training provides an excellent theoretical and technical foundation for corporate finance. The ACA course includes modules on corporate finance and leaves you well equipped to be able to analyse company performance and balance sheets and build financial models."

Andy Moffatt spent 12 months working for an asset finance company in Glasgow, focusing on lease financing before taking a one-year MSc in International Securities, Investment and Banking at Reading University's ISMA Centre to help re-direct his career. Andy is now a fund manager at London-based hedge fund, GLG Partners.

" I'd applied to work in the City while I was studying at Strathclyde, and had a few unsuccessful interviews. I was still determined to work in the City, but felt that I needed something completely different, like another and more specialised qualification. I thought, rightly, that the ISMA Centre's programme would get me a job in the City of London.

While I was studying the MSc I sent off about 30 or 40 speculative CVs to different banks, as well as filling in banks' application forms. In the end, I got around six interviews at major city banks. This time I knew a lot more about the industry I wanted to join. That year, around six of us joined Barclays from the ISMA Centre."

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