Landing a Job as a Banking Analyst
Strong GPA, Relevant Work Help — And So Do Alumni Ties
By MANEET AHUJA
Last winter, after six rounds of interviews, Alina Khaykin won a summer internship on Wall Street. The junior at New York University’s Stern School of Business was one of only three Stern undergraduates in a pool of about 200 who were offered jobs as summer analysts in the equity-research division of Credit Suisse Group, the European investment bank.
Then, as the 10-week program wound down, Ms. Khaykin hit the jackpot: a spot in the analyst program after graduation. "Going in we were told the internship was essentially a 10-week job interview, so the environment was very intense," she says. "I followed the FILO policy — first one in the office, last one out — always."
Analyst programs offer entree into the banking industry. The going rate for new hires is $60,000 to $65,000, plus an $8,000 to $10,000 sign-on/relocation bonus and the possibility of a year-end bonus of $30,000 to $45,000. Most analysts stay at the job for two to three years. Then they are either promoted or move on to another bank, business school, a hedge fund or private-equity firm, or another career.
"More and more students are striving for these front-office opportunities, which are well-recognized for molding young trainees into financial whiz kids," says Peter Cappelli, professor of management and director of human resources at the Wharton School.
David N. Schwartz, the former head of investment-banking recruiting in London for Goldman Sachs Group Inc., says getting talented analysts is important for the industry. "You don’t grow an investment bank simply by hiring the best at the top," he says. "You also grow an investment bank by hiring the very best at the bottom — the engines that keep this industry running — the analysts."
After four to six weeks of in-house training, newly minted analysts compete for choice industry slots within the bank. Popular industry groups like financial institutions, media/telecommunications, and casino and gaming have been known to conduct two or three rounds of internal interviews before picking one or two analysts to stay with them for the rest of the program.
After settling in, analysts must manage a wide range of responsibilities, from mundane tasks like composing pitch books for client presentations to more complicated tasks like creating and running financial models and analyzing the possible monetary impact of potential transactions.
Not surprisingly, getting into analyst programs is highly competitive. Citigroup Inc. says it received more than 16,000 applications this past fall for analyst positions in its capital-market and banking divisions alone. Of those applicants, 2,200 students were interviewed for about 500 positions. Merrill Lynch & Co. says it got 20,000 applications for 700 slots. In a survey of employers published on the Vault.com Web site, an Ivy League-educated analyst at Lehman Brothers Holdings Inc. is quoted as saying: "From my school alone we review 150 to 200 résumés for the summer analyst program, and will give about six to 10 offers."
To beat the odds, undergraduates who want to break into the industry often spend the years leading up to their junior year executing a master plan. In addition to maintaining a GPA of at least 3.5 on a 4.0 scale — the unofficial cutoff at many top financial-services firms — that can mean accepting grueling, unglamorous part-time jobs to gain the experience necessary to make it through the initial round of résumé screening.
Bart Rosenthal, also a student at Stern, assisted a financial adviser at UBS AG before landing his junior-year internship as a summer analyst at Bear Stearns Cos. "There was a lot of filing and cold-calling involved — two tasks that weren’t my favorite," he says. "But I knew that having UBS on my résumé automatically boosted my chances of getting a summer analyst position, which would hopefully lead to a full-time offer."
Mr. Rosenthal worked in market-risk management at Bear Stearns last summer and has accepted a job there after graduation. "As a summer analyst, I had the unique opportunity of crunching numbers for the global [value-at-risk] and exposure reports," says Mr. Rosenthal. "The reports were distributed world-wide, and I’d even occasionally get emails from senior traders in London asking me questions about how I arrived at the numbers. At the end of the 10 weeks, I really felt like I had grown into an asset to the firm."
With firms like Lehman Brothers and Citi now rolling out summer analyst internships for sophomore students as well, it is critical for applicants to get an early start.
"We introduced a new generalist program to target students earlier in the process," said Courtney Storz, executive vice president for campus recruiting at Citi. She says recruiters "were surprised to find that even at that level, many of the applicants had already had relevant work experience."
Reaching out to influential alumni also can be a way to boost your odds of getting noticed. Under pressure one year to reduce recruiting costs, Mr. Schwartz, then at Goldman, was responsible for implementing a human-resources department choice to remove a few schools from the "target" list. Among them: Boston College. When word got out to a few powerful alumni at Goldman, "they were absolutely livid and raised hell," he says. "Within minutes the school was added back onto the list."
Mr. Schwartz, who now runs the executive search-firm DN Schwartz & Co., said that "for a kid looking to break into the industry from a nonpowerhouse school, the alumni connection is the most powerful tool they can equip themselves with."
Trudy Steinfeld, executive director of NYU’s Wasserman Career Center, worried that the slowing economy might lead firms to renege on job offers for graduating seniors come summer. "Thankfully, my concerns were quickly put to rest," she says. "The banks said that analysts work extremely hard, provide relatively cheap labor and make money for the firm. They can’t afford to lose that kind of intellectual capital."