This could easily be asked as an interview question and one that seemingly causes a lot of confusion for aspirants in the Finance domain. To help you understand investment banking, it’s best to differentiate it from the type of banking that you have experience with: commercial or retail banking – the banks that you see on the street.
The banking sector is split into two fundamental divisions: Investment banking and retail banking.
Let’s understand what Investment banking is. Investment banks are huge financial institutions that assist their clients – mostly corporates and government agencies – in raising capital by underwriting and acting as the agent or an underwriter in the issuance of securities.
An investment bank assists these organizations with complex financial solutions such as Mergers and Acquisitions, Equity Underwriting, Private Placement, Valuation and Fairness Opinion, Corporate Restructuring, Structured Refinance, Management Buyouts, among others.
In a way, Investment Banks serve as a bridge between large corporations and investors.
Investment banking is split into front office, middle office, and back office activities. Think you want to be an investment banker? Chances are the role you are imagining is a front office role.
On the other hand, The bank where you maintain your current (UK), checking (USA) or savings account is a commercial or retail bank. You cannot go into an investment bank and deposit your money, get your ATM card, or ask for a student loan. This is what commercial or retail banks do. – The value of transactions that happen in a retail bank is very low in nature but the number of transactions are significantly higher than those of investment banks Some retail banks have an investment banking unit, others do not. For example SBI Bank is primarily a Retail Bank and has established a subsidiary company SBI Cap Securities, which carries on investment banking operations. Retail Banking encompasses a wide variety of products and services like Savings Accounts, Bank Guarantees, Certificate of Deposits, Mortgages, Personal Loans, Letter of credits, Foreign Exchange services for retails clients, Insurance business, Wealth Management Services, Personal Banking, Stock Brokerage Services, Locker Facilities etc. which are not provided by Investment Banks.
Some of the well-known Investment Banks include:
- J P Morgan and Chase
- Bank of America
- Wells Fargo
- Morgan Stanley
Some of the well-known Retail Banks include:
- HDFC Bank
- ICICI Bank
- Bank of Baroda
- SBI Bank
To sum up, here are the key differences between investment and retail banks:
Think investment banking is a career option for you? Interested in learning more? Join our CIBOP (Certified Investment Banking Operations Professional) program to learn about Investment Banking in more detail.
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Banking Career – Placement Scenario
Career Placement Assistance is a crucial aspect of the Imarticus Learning curriculum and the placement team at Imarticus provides 100% assistance throughout the program to guide and help navigate ample career options. Our 8-step career preparation process will ensure that candidates have access to the best opportunities the industry has to offer.
Alongside learning, the Imarticus Career Services team helps secure the best possible opportunities and provide guidance and assistance at every step. With over 15 years of experience in Human Resources, Talent Development and Sourcing, our team possesses strong established networks in the industry.
The Career Services team offers two key services:
Placement Assistance: The Imarticus Career Services team is the primary liason between recruiting companies and students. They leverage our Industry Council and Board of Advisors to ensure that the best opportunities are provided to our students. Throughout the year, our account managers are in touch with the industry and are continually updated with the company hiring needs. They provide candidate-briefing packs (video resumes, CVs, profile) to the recruiters, and work with them in tandem to ensure that Imarticus students are placed appropriately. At Imarticus, we believe there is a ‘right job for the right candidate’ and are committed to finding that job for each one of our students
Banking Courses Offered by Imarticus
Career Preparation: Career Services will provide dedicated support to ensure that each Imarticus student is ready for his chosen career. This includes:
• Communication, Presentation, and Business Etiquette workshops
• Resume Writing: Guided resume writing practical workshops, and faculty and peer resume reviews
• Interview Prep: Multiple Mock Interviews and Video Recorded interviews (where required) with professional critiques to improve and polish each student’s interviewing skills
• Counseling: Complete assistance in all career related decisions from experienced professionals
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Placement Process in Imarticus
Our 8-step career preparation process will ensure that candidates have access to the best opportunities the industry has to offer.
Step 1: Counseling
Imarticus Career Counselors will provide counsel and advise students in their careers keeping in mind the skill set and interest of every student.
Step 2: Unique Certification
The Imarticus certificate is unique and industry designed, and will truly differentiate our candidate from the rest of the applicants.
Step 3: Company Selection
With over 15 years of experience in human resources and talent development, the Imarticus team possesses strong established networks within the industry.
In addition, through our Industry Alliances, we have:
•Strong relationships with senior management and human resources across the investment banking industry
•An in-depth understanding of hiring requirements
•The Imarticus Advisory and Industry Council comprising of senior representatives across all firms who play an important role in the placement process
Step 4: Job Preparation
The team at Imarticus provides dedicated support to ensure that each Imarticus student is ready for their chosen career. Through communication workshops and counseling, every student is offered complete assistance in all career related decisions from experienced professionals. Please see the blog post on our soft skills or Emotional Intelligence training.
Step 5: Interview Preparation
The career preparation team will ensure that you are completely prepared for your interviews and provide you with tools that will help you handle both one-on-one interactions and group discussions with confidence. These include multiple mock interview sessions which will be video recorded where necessary. This will be followed up with professional critiques, which will pinpoint your weaknesses and strengths and get you ready to ace the selection process.
Step 6: 100% Commitment
Students will have full support until they are placed, and we are committed to finding the right job for the right candidate.
Step 7: On the Job
Imarticus introduces opportunities while teaching you practical job skills and real world knowledge. Imarticus will not only place you but also kickstart your career so you advance quickly.
Step 8: Alumni
During your time here at Imarticus, you will create a network that will last a lifetime. This network is a critical part of your career preparation as it will act as a support system that adds value to both your personal and professional life. We encourage you to keep in touch.
Details of placement & sector wise student placement
Despite the lackluster job market, the last year was a successful placement year as Imarticus Learning leveraged its network and took great care in preparing students for the interview process. Students were put through almost five sessions of Aptitude test training as well as three rounds of mock interviews.
So far Imarticus has placed over 85% of its students and is in the process of placing the rest. Sectors include derivatives, Equity Research houses, Treasury Operations of bulge bracket Investment Banks, Finance & Product Control, IB Software development, fund Accounting and securities operations. Students are also being placed in the Corporate Finance divisions of large conglomerates. We do not take a cookie cutter approach to placements. Instead, we evaluate the candidate and understand their ambitions. Salaries are offered in a range of Rs 2 lacs per annum to Rs 9 lac per annum.
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List of Institutes
Imarticus Learning has strong networks in the industry and we place across global and domestic bulge bracket investment banks, boutique investment banks, brokerage firms, equity research houses, KPO’s, and large and small companies.
Companies include Deutsche Bank, Bank of America, Tresvista, Axience, Morgan Stanley, HSBC, JP Morgan, Goldman Sachs and Northern Trust.
With banking direction at a record-breaking high, quantity of establishments seems, by all accounts, to be at an untouched low, and still on the decay. Mergers and acquisitions are on the ascent, yet sanctions proceed on a descending winding, with states the nation over all observing comparative patterns.
So where has all the managing an account was gone and what is banking today? Merriam Webster characterizes banking or investment banking “as the matter of a bank or financier.” In substantial part, that business includes sending stores as an advance to borrowers; these assets having been acquired through a development of stores and capital.
It shows up as though purchases and organizations alike are looking to elective wellsprings of financing generally alluded to as FinTech; sources outside of customary banks, where endorsing necessities may be fairly more liberal, terms more adaptable and insurance all the more broadly characterized.
Today, that same industry part could now be all the more in exactly depicted as a “wellspring of assets,” which can, as a rule, be gotten to on the web. This makes the loaning exchange geology unbiased and speedier from application to endorsement to financing.
Consider the accompanying option loaning choices:
Peer-to-Peer (P2P): where an online stage matches moneylenders and borrowers in light of specific information which can be electronically assessed momentarily; loan specialist overhead expenses are commonly lower and financing costs focused in light of the credit nature of the borrower. “In the vicinity of 2014 and 2015, the estimation of worldwide P2P loaning was relied upon to ascend to an esteem seven times what it was in 2014 – from 9 billion to 64 billion U.S. dollars. By 2050 the esteem is relied upon to be near one trillion U.S. dollars.”
Crowdfunding: for the most part don’t require reimbursement and ordinarily get financing from an expansive number of little commitments from people who bolster a specific business’ procedure and potential effect. Crowdfunding can appear as a value venture whereby the speculators advantage from future income and capital development of an organization, a gifts/rewards display, a loaning model or a consolidated model. It is evaluated that there are more than 375 crowdfunding stages in the United States alone and well more than 500 around the world. A few sources have dollars raised at over $8 billion. Be that as it may, given the assortment of stages used to request supports, a correct sum can’t be resolved.
Figuring and Merchant Cash Advance: ordinarily, applies to less credit-commendable borrowers who get to financing in return for an expense and are reimbursed through the receipt of money on records of sales and future credit deals individually. A gauge for the overall volume is this space surpasses $3 trillion.
In spite of the fact that FinTech organizations keep on gaining energy using Big Data and innovation, conventional banks keep on holding by far most of the loaning piece of the overall industry. May 2017 measurements distributed by the Federal Reserve demonstrate add up to bank resources at $16,241.5 billion in the United States with $12,591.6 billion of that gathered in bank credit “i.e. loaning”. Still, as a rule, more stringent endorsing norms at customary banks have cut off access to certain new companies or battling organizations and therefore FinTech has ventured in to offer an option. A 2014 Fortune magazine article notes “… Startups in the monetary innovation field, or “fin-tech” as it’s normally called, are blasting, and huge foundations, for example, Bank of America, Citibank, and American Express are emptying cash into these agile new organizations to meet present day administrative, computerized and security challenges. Wander interest in worldwide FinTech tripled in the vicinity of 2008 and 2013 to $2.97 billion and is relied upon to reach $8 billion by 2018.”
While the field of Finance in terms of the industry has gone through various radicalizing changes, it has also resulted in great changes on the academics part of the industry. Today many top banks are seeking candidates who are thoroughly industry endorsed and have a formidable set of skills.
Investment Banking prospects in India are very promising. Planning a shift in careers or a fresher, this is one stream worth considering. Specially, if you are an individual who finds the idea of making money from money exciting.
In simple words, investment banking is a profession where you match the expectations of people who have the capital with those who need it. Although it is not as simple as it sounds. As you will be advising people or institutions on money matters across various phases of a life cycle of a project, ranging from the start up stage to the listing of stock markets, you need to maintain the optimum valuation. It requires great understanding of the market so that you can offer the most optimum advice to your client, on options like mergers, acquisitions, joint ventures etc…,
Certain skill sets required to excel in this choice of work are, high research and an analytical mind-set, par excellence communication skills, an innovators mind set, troubleshooting capability, genuine ease of working and analysing numbers, forecast sales and budget, technical knowledge. A person from any steam can think of starting their career in investment banking, but it important to have a good understanding in math, economics, business studies. Although you can pursue an MBA, to have a specialised course will serve as a spring board to your efforts and help you secure a job in a reputed company, or help you get that promotion you are waiting for since long.
There are very limited options you have in terms of getting a holistic training on investment banking, however one that has proven to be closest to giving you the best exposure and highly recognised in the industry is, the Certified Investment Banking Operations Professionals (CIBOP), it is a flexible program for both fresher’s and experienced professionals. And CIBOP can be considered as a pre prep for the CISI IOC certification program, it is highly regarded by investment houses globally and passing this certification echoes the thought that an individual does have a sound understanding of the financial services industry.
The CIBOP program offered by Imarticus, is a 180 hours’ program dedicated in understanding complex securities and derivatives, their trade life cycle, along with operational risk and regulation. CIBOP offers operations and domain training augmented with a personal development program. CIBOP has an industry relevant program, supplemented with industry stalwarts as faculty, and real case studies.
On completing the CIBOP course from Imarticus learning you will get an industry endorsed CIBOP certificate along with the optional CISI certified IOC certificate, besides this, Imarticus has career services and their placement team will guide and assist you throughout the program, providing the best career opportunities.
CIBOP is a hybrid program with online self-paced videos and live classes, along with classroom training. The CIBOP program also has a host of guest lectures, by experienced industry veterans, which presents abundant opportunities for students to raise questions and clarify doubts and get clear actual industry insights.
On completing CIBOP course you will have a sound understanding of every aspect of Investment banking along with practical aspects of the sector. So if you have an inclination towards this field and have some of the prerequisites in place, don’t wait and enrol with Imarticus Learning and take the CIBOP certification.
The finance and banking industry employs a wide range of professionals from brokers, including individual, business, and Investment financiers. While the parts and obligations of these brokers may vary, they all must administer the monetary needs of their customers. Individual brokers may work one-on-one with customers opening private company accounts and administering budgetary exchanges, for example, sending cash requests and dealing with stress.
Business investors prepare advances to planned business people, while venturing brokers, associate lenders with conceivable speculation openings. Additional time and travel are regularly required in these employments, particularly for venture brokers. By and large, financiers spend many work hours sitting at a work area. Payscale.com detailed a mean yearly pay of $35,226 for individual investors in January 2016.
Despite the fact that degrees in speculations and managing an account might be hard to discover, many projects have specialisations in these territories as a major aspect of different projects. Back, bookkeeping and business are the doubtless decisions, however, speculation firms and banks may likewise be satisfied to see degrees in financial matters, arithmetic or designing. Notwithstanding the program name, what employing boards truly need to see is that you’re great with numbers, and each of these degrees requests that of their graduates.
While in school, understudies ought to start sharpening the abilities they’ll be effective speculation brokers. Honing introductions, acquainting yourself with Microsoft PowerPoint and Excel, figuring out how to talk about numbers in a legitimate yet open way, and interfacing with a wide range of sorts, of individuals, are only a couple of the approaches to fabricate auxiliary aptitudes while likewise diving into coursework.
A banking entry level position might be a piece of a degree program or an open door an understudy seeks after amid the mid-year. Taking an interest in a temporary position gives imminent financiers involvement in the field and a comprehension of keeping money arrangements and controls. Furthermore, a temporary position may assist acquaint them with the obligations they’ll have once they start work. Entry level positions are likewise a route for people to start making associations in the exchange and systems administration for planned work openings.
Consider managing an accounted speciality. When investigating conceivable temporary positions, consider the distinctive sorts of investment banking and finance options as claims to fame. For instance, if you are inspired by venture banking, then apply for an entry level position with a speculation bank, which might be situated in a noteworthy metropolitan region.
Banks offer Investment Banking certification preparing programs that will plan people to find out about the procedures required in making ventures and working with customers. Those enlisted in the program are acquainted with business works with, saving money administrations, and customer relations. So as to start finding out about these practices, banks furnish people with contextual investigations, introductions, and displaying sessions.
So when you are looking to start a career in banking, it is always better to look up for certification training programs like these. Imarticus Learning offers a number of certification programs in finance and banking which would be of interest to you.
Investment banking is synonymous with big pay cheques and long working hours. As soon as you start your career in it, you will realise that you are being stretched in all directions, with no time for family or friends or personal tasks. Most veterans in investment banking express that they feel they are always short-changing something or someone throughout. It is always a race against time.
Having said that, the same veterans, to survive the mad rush, have come up with some coping mechanisms that help them balance their day, ensuring that they touch all spectrums of tasks, personal, professional etc…,
Listed below are some lifestyle hacks in personal and professional capacity, that will help you get joy, out of the most tasking regimes and demands, faced at a professional level by investment bankers.
- Get a solid support system, and outsource as many tasks as you can without guilt, for example, use laundry and iron services from professionals, rather than expecting your spouse or you to do it over weekends, or if you higher up the ladder, an assistant at work or a junior can be used for delegation of tasks.
- Do not intentionally drive around to work, it will only add to the frustration of daily tasks, use Uber, or hire a driver, given the traffic and road conditions, you will feel blessed with the extra time you get to concentrate on tasks before reaching work.
- Better still, stay closer to work, even if the rent is higher it will save you loads of time invested in travel.
- Invest in good housekeeping, you will have enough deadlines and last minute reports to work on, getting groceries and cleaning your house will always take a backseat. A good help at home will rejuvenate you to face the challenges of the days to come.
- Walk as much as you can, you will need the exercise with time if you have to visit a client, see if you can take the trains or metro, walk, let the fresh air clear your thoughts.
- If you insist on holding on to your car, break the routine, on some day’s drive, listen to music, choose non-traffic hours to get that fresh rush of adventure on the way to work, it will clear any jarred thoughts from the previous day.
- Keep in touch with friends from the same industry, someone who can understand your challenges and limitations.
- If possible, choose a partner who understands the demands of your work life, possibly someone who themselves don’t have very demanding schedules, or else matching up with each other will be a life long struggle.
- Find solitude with yourself, keep a reality check, know the demands of your job.
- Travel, even if it is in your hometown from time to time, short trips, and do them alone, to stay in touch with yourself.
- Exercise, regularly or whenever you can, simple yoga asana, help you maintain the equilibrium.
- Expectation Management, be prepared that your life over the next few years will be demanding, the good news is that the body adjusts to the demand effectively with time. So, until then know your outlet to cope with the demand, be it swimming, writing, sleeping, indulge in it, drift away from work a little while.
- Eat well, small regular meals, will keep your system running, you will have to work long hours, prepare for that, tea or coffee whatever keeps you going, do hydrate yourself. Avoid drinking (at least on working days J)
- Be pleasant to people at work.
- Find your sweet spot, associate with a firm that does the kind of business you enjoy.
- Stay sane, have a sense of humour, enjoy the kind of work you have chosen, don’t take yourself too seriously.
- Be a good listener, you will be surrounded by intelligent and bright people, learn quick, be smart and rise up the ladder soon, there is breathing space up there.
- Learn from every experience, learn not only from success but also from mistakes.
- Take regular naps, quality of sleep is important not the quantity.
- Learn how to improve your performance in everything, automate repetitive jobs, will save you some time.
Investment banks, in the true sense, are financial intercessors, amongst people who need funds and people who can provide funds. They ensure that there is a flow of cash and distribution of capital. In a simple example, they are the bridge that brings together, those who need money to invest in businesses, like factories with equipment demands, with those, who have the money to invest, all the while, forming the markets which allow capital and controls price for these monetary trades.
Over time these financial intermediaries have evolved and have gotten more complex and competitive. And hence have started offering many supplementary amenities.
Investment Banks essentially have two lines of activities.
- Sell Side – here securities are traded not only for cash but at times for other securities like for example, in facilitating transactions.
- Buy Side – this is the advising lateral, where to advise on entities like, Private Equity Fund, Mutual Funds, Hedge Funds, is given to establishments that are concerned with buying investment services.
Core activities of Investment Banking can be better explained in three major divisions.
Front Office, the Middle Office and the Back Office.
Front Office, is generally known as the revenue generating unit, this is where most of Investment Banking contracts take place. It offers many services, namely assisting firms in Mergers and Acquisitions, Corporate Finance I.e. managing fund requirements for daily operations. It also offers Professional Investment Management for establishments. For certain high net worth clientele, preparing Market Research Reports, around Strategy Management and Wealth Distribution and Risk Reports. And lastly, it also involved in Sales and Trading activities for their clientele.
Middle Office, includes functions of Compliance with government regulations and restrictions for professional clients like the banks and financial divisions etc…,
It also manages Capital Flow, basically, the function is to monitor the flow of cash in and out from an establishment, to ensure required liquidity for it to function, without getting into any financial difficulties.
Back Office, it is the glue that holds the investment bank together. It primarily manages the Operations and Technology, for things such as Trade Confirmations, safeguarding that the securities bought are correct, sold and settled for the right amount. To ensure the software and technology platforms are efficient, at times creating relevant trading algorithms, so that traders can function effortlessly.
Investment Banking is significant for corporates as they need to raise capital. By taking the above-mentioned functions into reflection, the area of opportunity for investment banking is huge. Therefore, to stay updated, financial handlers should take stock of the development around them, so that they can adapt and take advantage of the offerings.
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Welcome to the age of instant gratification. The demand for the instant seems to be seeping in every corner of our society. The types of food we eat (the high range of ready to eat meals or the typical fast food chains, instant reviews to the food we eat) you see it all around you, let that be in the retail market (speedy deliveries), or the entertainment business (you have latest movies with instant virtual streaming available), travel (apps that help you book cabs, no waiting for them anymore, apps to make hotel and restaurant reservation).
Most of our lives are hyper-connected. Living in the now and thus subconsciously continually giving in to the era of instant gratification and the interim loss of patience.
Now let’s understand the personalities of Trading and Investment.
Mr trading is very competitive, most often taking risks while meeting the desired results. To some, he may come across as aggressive or impatient, but it mostly stems from the ambitious aspiration he has set for himself. Mr Trading’s primary focus is on quantity, as he believes eventually quality will be achieved through chance. He is very outgoing and is usually revered by most people he meets. His friends describe him as a workaholic, as he has an obsessive need to take risky decisions in the nick of time and hence is always on the run. There is a strong sense of control that he constantly demands.
To be specific he gets his drive to be committed to his line of work from the constant adrenaline rush that he gets on cracking the right deals and overcoming risk if any in the process. He is usually under a lot of stress but loves the mystic and the adrenaline rush that his job gets.
Mr Investment (Arch Nemesis of Mr Trading)
The steady worker, who derives his motivation from the end result. When faced with competition focuses less on winning or losing, but does the right thing to eventually get the desired result, and in some sense enjoys the process. He is well networked and also well respected within by peers. Is known to be informative and analytical. A hard worker who is organised and calculative hence is gradually and eventually accurate in getting the set target.
So you see Investing and Trading are two very different methods in attempting to make profits in the financial markets.
Investing is a method of gradually building wealth over an extended period of time through the buying and holding of stocks, Mutual funds, Bonds and other investment instruments. Investors often enhance their profits through reinvesting or compounding any profits and dividends into additional shares of stock. Investments are long term, ranging from a couple of years or even decades, in turn, taking advantage of perks like interests. Markets may fluctuate but investors usually ride out the lows with the expectations that the losses will be covered with rebound.
Trading is, on the other hand, a more frequent buying and selling of stock, commodities with the goal of outperforming the buy and hold investing method. Profits are made by buying at a lower price and selling at a higher price during short intervals. With a myopic investment goal to make money.
Everyone likes making money and usually, that is the driving factor, the “high” from making more out of less, it’s not only a natural high but an adrenaline rush, and like all addictions, one time is never going to be enough. It is a short time commitment to big results or even big losses and the risk makes it attractive.
While Investing is a more proactive method to make your money work and make more money for you. In investing you buy an asset like shares and the straightforward idea is to sell it at a future date when the value appreciates. It’s common knowledge that good investment is a sound way of growing wealth, it’s a long term commitment.
However, it is interesting to know as true Arch Nemesis, both investment and trading cannot completely exist without one another. You see without trader’s, investments will not have any liquidity to buy and sell stock, and without investors, traders will not have any origin or any source to buy and sell from, hence no one can be grander to another.
The only place where the scales lean are the personalities that get attracted to the fast and the furious, and in that Trading emerges as the prototypical winner.
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The chief regulatory body, which is supposed to deal with all the finance and banking related decisions, is the Government of India. In the recent times, this body seems to have taken a considerable amount of decisions in order to strengthen the Indian Banking Sector. Some of which are as follows.
In the month of July 2016, the Government of India reportedly allocated about 3.41 billion USD. This amounts to Rs 22,915 crore, which was allocated in the form of capital infusion to 13 public sector banks. This move is believed to increase the economic growth of the country by improving the liquidity and lending operations of these public sector banks.
The Reserve Bank of India (RBI) has already begun on its move to make all transactions digital in nature and absolutely paper free. Following in the same vein, the RBI has released the Vision 2018 document, which primarily aims at increasing the use of electronic payments through all the divisions of the society. This move will not only increase the usage of digital channels but also boost the customer base for mobile banking.
All the commercial banks which are scheduled will now be allowed to grant non-fund based facilities including partial credit enhancement (PEC), to all customers including those that do not avail any fund based facility from any of the banks present in India.
The Union Budget, which was announced in the year 2016-17 had a provision towards interest subvention. This provision is basically made to help in reducing the burden of loan repayment by the farmers. On account of this, an amount of 15,000 crore INR is being granted by the government.
The Government of India is looking to set up an exclusive fund, which will be a part of the National Investment and Infrastructure Fund (NIIF). This fund will basically be set up for dealing with all the stressed assets of banks. This fund will be taking over all the assets, which although viable do not have any additional fresh equity from promoters to complete the projects.
Post the massive drive that was conducted by the government to open up a number of bank accounts, quite a large number of Indians were financially included in the banking sector. The Reserve Bank of India plans on coming out with guidelines, which will be dealing with the basic know-your-customer norms. These norms would be the primary focus of protecting the consumers.
The government of India is well on a warpath, to provide insurance, pension, and credit facilities to all of those citizens, who were excluded from enjoying the benefits offered by the Pradhan Mantri Jan Dhan Yojana (PMJDY).
In a bid to provide relief to all the state level, electricity providing companies, the government has proposed to its lenders that, about 75% of their loans would soon be converted to state government bonds.
Thus with so many new and effective schemes falling into place, courtesy the government of India, things are looking quite positive for the banking sector. This is great news for those finance enthusiasts who opt for special training programs, offered by Imarticus Learning in the field of Finance and Investment Banking.
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Every finance aspirant, at one point or another, envisioned themselves as one among the many professionals in crisp suits and black pencil skirts, walking along the hallowed hallways banks like Morgan Stanley. While some individuals choose the more tried and tested route to achieve this aspiration, like pursuing their MBA, there are many others who make use of new and innovative ways to achieve their ambition. These ways include pursuing of intensive professional training courses, which are becoming popular by the day. Courses offered by Imarticus Learning are gradually becoming the go-to courses, chosen by those especially who wish to become Investment Bankers.
One of the most exciting areas of work, in the field of Investment Banking, is working in the front office. This area is usually what most of the exciting Investment Banking movies revolve around and it’s here that the real game is played. The ‘front office’ is divided into Sales and Trading, Corporate Finance and Research. It may be seen that the recent times have been experiencing a great amount of technological change in these three sub-fields of Investment Banking. Artificial Intelligence and business process automation are two of the many analytics technologies, with the help of which these three fields are attempted to be deconstructed.
Let’s begin with Sales and Trading, roles in this sphere are popularly known as the alpha roles in Investment Banking. The professionals working on these positions were considered to be the leaders of the wolf pack and they were very capable of getting away with just about anything. This has changed as the ‘nerds’ have steadily begun to replace them. This shift is the result of technology specifically, computer engineers taking up the positions. Goldman Sachs reportedly had over 30% of computer engineers as their traders. Recently another big gun, JP Morgan hired their Global Head of Machine Learning from Microsoft. What is surprising about this recruitment, is that the professional has absolutely no background in finance whatsoever.
When it comes to Investment Banks, a huge chunk of their work is carried on by the Mergers and Acquisitions Departments and the IPOs. It is common knowledge that artificial intelligence has already begun to make its presence felt in the field of accounting. Similarly, Corporate Finance is not being left behind as there are a number of well-paid analysts, managing the sweaty work for their Managing Directors. The field of IPOs is also being transformed, much similarly to what the CFO of Goldman Sachs has to say. He says, “Goldman Sachs has already mapped 146 distinct steps taken in IPOs offering stock and most of them are begging to be automated”. It won’t be long before stock market is made up of all the secondary markets created by FinTech companies.
Anyone who is a finance aspirant would be expected to know the difference between ‘active funds’ and ‘passive funds’. The million dollar ideas of all of those Portfolio Managers who build active products come from paid research teams at various Investment Banks. In the recent times, this basic financial commentary is speedily automated. With technologies like the blockchain technology and banks teaming up with software companies, it seems that the entire banking sector is set to undergo an overhaul, courtesy of AI and Data Science.
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