How to become an investment banker: complete application guide

How to become an investment banker - full guide

You’ve done your homework – and decided you want to be an investment banker. Congrats. You are a tough kid. Chances are you might be fit for banking. So what’s next?

You might know odds of landing an offer are close to 0%. Every year investment banks receive thousands of applications for one position. Goldman Sachs alone had 267,000 applicants in 2014. 3% got offers to join the bank. Morgan Stanley saw 90,000 applications for summer analyst program only. 2% were accepted.

So how can you increase the odds of getting in? First and foremost – familiarise yourself with the application process. Ensure you know exactly what is waiting for you. This is exactly what this guide is for. A complete step-by-step guidance on how to become an investment banker – where, when and how to apply and what to expect in the upcoming months.

How to become an investment banker: the basics of the application process

Investment banking application process can be broadly divided into 7 steps:

Step 1: Choosing the bank to apply to

Step 2: Deciding when to apply

Step 3: Selecting the position and checking eligibility

Step 4: Submitting online application

Step 5: Passing the reasoning tests

Step 6: Nailing the interview

Step 7: Signing the offer

Step 1: Choosing the bank to apply to

As a default strategy strategy, always try to aim at top banks. They generally give away more offers, have higher compensation and best opportunities for exit. As full-service investment banks they also provide applicants with a variety of teams and divisions to choose from. The top-9 largest and most prestigious are Goldman Sachs, JP Morgan, Morgan Stanley, Bank of America Merrill Lynch, Citi, Deutsche Bank, Barclays, Credit Suisse and UBS. These are the sharks of investment banking with the best reputation and largest exposure to global deals.

There is also a long list of other global investment banks (they are slightly less prestigious but usually have a very strong presence in at least one region). And there are also global investment banking boutiques. They are generally smaller and specialise in only some aspect of investment banking, such as corporate finance. Despite the small size they often work with high-profile clients on a variety of landmark deals. Good example is Lazard and Centererview – both advised on 2015 biggest transaction – merger of Kraft and Heinz companies.

Tip #1: aim to apply to at least to 15-20 banks. No, seriously. Apply to as many as you can. The more you apply to – the better are the chances of success. Top banks give offers to only about 2-4% of the applicants (expect around 40,000-90,000 applications).

How to become an investment banker: top investment banks  infographics

Step 2: Deciding when to apply

The global recruiting cycle starts in the end of August – beginning of September. Applications are open for two-three months. This is the period where you can apply for most of the positions, including internships starting in summer and full-time positions starting September next year.

Investment banks rarely hire outside the cycle (although you will need to check bank-by-bank basis). Exceptions are local offices (Frankfurt, Amsterdam, Milan, Moscow) that often hire  throughout the year. Head to career pages or talk to local HR office to see if there any positions open at the moment.

Tip #2: Applying early is always a good idea. Many banks hire on a rolling basis – which means more offers are given away in the beginning, and less by the end of the cycle. Besides, even if you get rejected early, you will still have options to apply to other firms later on.

How to become an investment banker - Infographics on when to apply

Step 3: Selecting the position and checking eligibility

Go to the bank’s career website to see open positions. Global banks will usually have applications open for corporate advisory and markets, sales & trading as well as equity research.

Tip #3: Check carefully job description and eligibility criteria. Pay specific attention to language requirements to see if you are fit to apply for a particular office. You probably won’t be able to change your choice later – so make sure you pick the correct role.

Positions open might include internships (summer, spring and autumn) or full-time (analyst and associate). Many graduates are tempted to apply for full-time straight away. Makes sense – why would you apply for an internship if you can immediately secure a permanent position?

Well, not so fast. There are a few reasons you should consider going for an internship first. For once, it is a good chance to check if you actually like investment banking in general, and your team specifically. More importantly, recruiters expect less experience and knowledge from internship applicants, and chances are – getting in would be easier. With internship applicants the focus is more on personality and fit rather than technical knowledge.

Tip #4: Never apply for a full-time position if you do not have related experience from a top bank on your resume. Your chances to get in will be very slim without prior internships.

If you think internship position is not for you – remember the difference between interns and first-year analysts is not that huge. You do very similar work and receive the same compensation (except for the bonus). Besides, top banks prefer to promote their interns rather than hire from outside – so 70%-90% of summer interns get full-time offers later on.

Regardless of the position you apply for – you should have a standard investment qualification package. Top university, top grades, interest in finance, extracurriculars, evidence of leadership and so on. Many banks will tell you it doesn’t really matter which background you come from. This is only partially true. Background itself doesn’t matter but it should be excellent anyways. If you don’t think you have it – there are always many ways to turn it around. It just takes some creative thinking. We cover it in our Insider Guide – and will tell you more in the upcoming posts.

Step 4: Submitting online application

Most banks today accept online applications only. Once you are registered on the website, you will be asked to fill in your personal details, education and employment history, motivation to apply for the job. In essence online application is your CV – just in electronic format. Many banks will have an additional ‘competency section” to check your skills (something along the lines of “Describe a time when you demonstrated leadership” or “Tell us about a situation in your life when you were under significant stress”).

Tip #5: Don’t rush to fill in competency questions. A good strategy is to check common questions and write answers to them in advance. All you have to do later is just find a fitting one for a particular bank application.

Take your time to fill in the application. Ensure there are no mistakes, check the files that need to be attached. Usually you will be required to attach your CV and cover letter along with educational certificates. Other documents are not obligatory, although throwing in some letters of recommendations or achievement certifications might benefit your application.

Tip #6: Never submit the application in one go. Remember you can save a draft and finalise it later. This will allow you to have a fresh look on the file and ensure nothing is missing.

Although generally the application process is the same across different banks, it may vary depending on the location. Rules on how to become an investment banker differ in each country. In some regional offices you will not be required to submit an application at all. In United States you might have to do a lot of networking beforehand.

Tip #7: Apply in reverse order. The more applications you submit, the better you will get in it. A good strategy is therefore to apply to your least favourite banks first. You will get a chance to see the applications and practice the tests. Once you feel more confident – you can go after your preferred banks.

Step 5: Online reasoning tests 

In most cases straight after you submit your application you will get an invite to take numerical and verbal tests (in some cases, like UBS, logical test will be included as well).

Tip #8: don’t submit your online application unless you are ready to take tests immediately. Once you hit send there is a chance you will be required to take the tests within the next few days, so make sure you are prepared.

The tests are more or less standard for all banks. That is, even although the questions differ the outline is pretty much the same. Numerical score is going to be extremely important for everyone applying for roles in advisory and trading. Questions are built around some basic math – percentages, fractions, interpreting graphs and tables. Although questions are not too difficult, time pressure is what usually gets to applicants – you have to answer 20 questions in 20 minutes. Don’t assume you failed if you don’t finish one or two – your score is likely to be ok if all the other questions have been completed correctly.

Tip #9: Your best chance to pass the tests is just practice consistently over a few days. You can find some practice questions at the websites of reasoning tests providers Kenexa and SHL Direct. This will also give you an idea of the format you will face. Alternatively, we are preparing a pack with complete questions that are used by most banks (together with answers). Sign up for our newsletter if you want to be the first to know when they are out.

Step 6: Nailing the interview

Once, and if you pass online tests, you will be invited for an interview. Depending on the bank, it might be telephone interview, interview at your local office or straight a full-day assessment day with case studies and multiple interviews. This is something you will have to prepare well in advance –  the last and most critical part of your application process will completely determine if you get the job. I will go into detail on interview preparation in future posts.

How to become an investment banker - Infographics on top  tips

Step 7: Signing the offer

If you are successful you will be notified by an HR representivave of the firm. Usual time varies, but you should know about the outcome no more than in a week after your interview.

Tip #10: If you didn’t get the offer – don’t despair. Ask for feedback of your performance – this will really come in handy with applications later. A key to getting in is focusing on your application, preparing thoroughly and continuing to apply. I personally got rejected more than 10 times before landing offers with JP Morgan, Deutsche and Lazard.

If you were successful, you will be sent an offer. Afterwards – its up to you. Sign, decide on which team you would like to join and prepare for one of the toughest – and most fun – periods in your life.

If you need help with your application, there are a few ways to go about it:

1. Check how strong is your application and if you are eligible.

2. Learn how to tweak and ibify your resume.

3. Download investment banking resume template or use the professional help to help you in the application.

4. Sign up below to get the latest tests answers and interview questions – and start getting ready.

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4 comments on “How to become an investment banker: complete application guide


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