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Guest comment: Why banking sucks

David Bledin, ex-banker, now author and MBA student, on why he wouldn’t go back into banking if you paid him.

I’ve just started an MBA programme and it’s amazing the number of people coming from non-banking industries who have somehow managed to maintain a startling innocence regarding the Street – despite the bleak stories they must have soaked up from their acquaintances. They seems to focus on that starting salary and rationalize away everything else – they tell themselves it will only be a few years before they’ll have racked up enough bonus pay to buy an achingly sophisticated loft in Soho and subsist on a steady diet of yellow-tail sashimi.

I’m here to tell you that if you don’t think your life is going to be miserable as an investment banker, then you’re wrong. Here’s a short guide to set you straight.

Don’t think you’ll remain unscathed.

You will not be the exception to the rule, the golden child who will remain untarnished by the industry. History will repeat itself, as it has since the founding of the House of Morgan: you will get a receding hairline, you will hate your Blackberry, you will tremble every time your phone rings, you will spend the occasional evening curled up under your desk.

Never forget that as a freshly minted analyst or associate, you are viewed by everybody senior to you as nothing more than a spreadsheet-laden donkey, somebody to crank out endless PowerPoint piecharts and not ask too many questions. And remember that your bosses were once in your shoes, too, so don’t expect any sympathy. It’s the vicious cycle of abuse, and you’re at the nexus of it.

Don’t think you won’t become bitter.

Your first week on the job, you’ll be bragging to all your non-profit buddies about your $30 dinner allowance, your company car transport, and your shared assistant. A month later, you’ll actually be nauseated by the sight of another prime rib, leaking its juice onto your mousepad and ready to expand your waist size even further since you don’t have time to hit the gym. You’ll be ashamed that you know more about your company car driver’s domestic turmoils than you do about the upheavals in your own family. And you’ll soon realize that your incompetent assistant is only there to make your life more miserable than it already is, sending out the wrong conference call numbers and printing out the wrong reports and getting much better Christmas presents than you ever will.

Don’t think the work will be interesting enough to warrant the all-nighters.

Let me introduce you to comps. Right now the word sounds innocent enough, but it won’t be long before the mere utterance of it will elicit night sweats and dilated pupils. Dealing with comps involves the meticulous and very time-consuming – even for Harvard grads – computation of endless financial ratios and multiples. Even once you eventually graduate to Excel modelling, it won’t be long before yet another circular reference will make you want to commit hara-kiri with your staple remover.

Don’t believe that any of your new relationships are genuinely sincere.

When I first started at my bank in the M&A department, I was trapped in a cubicle next to a guy who was nicknamed the Star. The Star was an Excel powerhouse, a guy who could shoulder the workload of three lesser analysts and still maintain the disposition of a Buddha. Everybody would constantly sing his praises, except for our head of HR, who was too removed from the actual workflow to recognize the Star’s supernatural abilities, and passed him up for a promotion to associate level. Any one of the senior guys in our department could have stepped up to the plate and fought for the Star’s promotion, yet nobody rose to the task. The senior guys were all too self-absorbed to genuinely care about the fate of their underlings. The Star skulked back to b-school and was replaced by a former marketing guy who had never seen an Excel spreadsheet in his life.

Just accept the fact that you’re doing it for the money, and it will help dull the pain.

You will be miserable as an investment banker, but heh, you’ll also be flush with cash. I’ve been out of banking for a few years now and my heart still hurts when I hear the bonus numbers from my friends who stuck around in the industry. While I’m taking out loans to pay for my MBA, they’re putting down 50% deposits on million-dollar brownstones.

So here’s a piece of advice: every time you’ve had a really horrible day at the office, go out and buy yourself an Hermès tie. If you’re going to need a noose, it might as well be a fashionable one.

David Bledin is a banker turned MBA student and author of Bank: A Novel.

Comments (38)

  1. This particular rat may have got out of the race (somewhat), but a comment regarding the stress of banking would have been a little more sincere if it would have come from someone who didn’t leave for an MBA?!

  2. Whats wrong with leaving for an MBA… clearly he wants to make a career change. In any case, are you denying the fact that banking is stressful? You are still a rat in the race.

  3. probably he is right a number of facts but the entire package of a career + a money aint that bad.. its just a matter of choice.. .some prefer the money and prestige and are ready to comprise a comfy no-tension 9 to 6 life for it, some want the latter…

  4. This guy sounds a little bitter. Maybe some houses treat you like crap, but find the right place to work, and IB can be fun. I work with great people and have a wide range of responsibilities, while still being pretty junior.
    Like ANY job, some will love it, some will loath it.

  5. Ok, somebody wants to make money with a book … having been on all sides (banker, entrepreneur, large company, start-up) it is all the same politics everywhere with ONE difference: At least in a bank, you get money and hirarchies are totally flat !

  6. I loved this, its years since Ive heard the word ‘comps’… I left M&A for the charity sector and have never looked back. To be fair, IB is a good training ground, can be interesting and the money helps. You just have to know what youre letting yourself in for and what you want out of it. And dont forget – people choose to stay in – year after year – dont complain – the door is always open if you want to leave.

  7. Dont sound bad to me, live it up, work hard, play hard,loads a money, girls, cars, etc. I am not a banker, and probably will never have the chance to earn mega bucks, so I’m glad you have to work your balls off to earn it! so you all should!
    Aren’t you supposed to have the MBA before the banking career?

  8. For one thing, this article is about Wall Street/US banking, so theres a difference straight away between US and UK work practices.

    And his moans sound like a professional footballer who moans about having to train.

    Hard luck, you chose it – if you don’t want the stress, do something else, which you did in the end – although an MBA ?

    Mr Unimpressed Reply
  9. Maybe quants are different, but I got into IB because it was exactly the job I wanted, not because of the money (which nevertheless is nice and almost essential in London).

    Anonymous Fixed Income Reply
  10. I have heard many histories about endless nites at JPMorgan and Goldman Sachs (London) , and I agree with the one who has said its very good for training, but my question is if NY IB is much more harder than London?

  11. This is why I chose trading -better hours, more interesting work, and in the last few years, better money. The beds at Goldman are for the i-bankers, not traders.

  12. I agree with Anonymous Fixed Income. there are plenty of interesting, and better paid, jobs other than m&a type stuff. m&a is fairly low skilled compared to market side jobs, and as a consequence is rather mundane and dull.

  13. I never had the opportunity to gain weight nor lose hair due to ibanking since I’ve never worked at a bank. But I can seriously believe this man as everyone I know who has spent time at an i-bank has either left for good after a couple of years. If they are still there, they are cynical, bitter, overweight, and superficially proud that they have “stuck around” in the industry. Another point: at least this ex-rat is more honest about ibanking life than those I know who continue to glamourise the industry. However, I understand this life is not for everyone and those who can truly cut it and make it theirs – more power to you.

  14. The work can be enjoyable but the head games and politics in IB make it a real drag. It strikes me as a place where evil genius’s can and will succeed. My current boss has all the skills of a one legged man in an arse kicking competition, but a ruthlessness that only Moa could appreciate. Thats the differnce.

  15. He is talking about corporate finance aka IBD and not quant and research dudes. Markets people go home at 6pm. IBD people spend all nighters. I know where he is coming from and I feel his pain. I would not have the time to type this now if not for the credit crisis as I would still be in the office at midnight.

    Anon Investment Banking Reply
  16. I leveraged from my exec MBA into IB, I agree that IB is certainly challenging and can be testing but to say it sucks is arguable.

    I suspect most hear stories of ‘long hours, sign your life away in IB’, knowing so still decide to enter the lucrative realm. I mean in which other industry sector can such amounts of money be earned by such a number of people.

    We all pay some price shape or form for security.

  17. I joined one of the top US banks in July on the IBD grad programme and 2 weeks after training (hence 2 weeks into the job) two analyst quit…

    Welcome to hell.. Welcome to investment banking. If you enjoy staying up then investment banking is for you.. if you enjoying pretending to be a big swinging dick (and constantly check your blackberry) infront of your non banking friends then investment banking is for you.. if you like your seniors to set you unrealistic deadlines or shout (and swear) at you for no reason or call you a terrorist because you are muslim and you fast then investment banking is for you..if you like to work 20 hours a day on pitches the client will not even read then investment banking is for you.. if you look good at a desk at 3am (on your second day of staying up without sleep) in a hermes tie and armani suit, expensive shoes then investment banking is for you!!!

    if you like a life (with less money), if you like fun, if you like to do challenging work (as a junior), then shut down your computer and run..

  18. JC 25 Banker,

    NY is way harder than London.. although London is catching up!

  19. Yes, i strongly support his move. I did the same, and i changed my career after so many years in banking.

  20. Although I completely understand he author’s perspective I must say that the all nighters are usually more tilted towards the bottom ranks and do not persist at the same extent at the top. In addition, the more time you stay put in the industry the higher the probability you will be able any given day to dump stuff to the ranks below you and go home earlier and let’s not forget shift the blame to them if they do not do as they were told. I do not want to sound Machiavellian but it is a little bit like the army. New recruits suffer and it doesn’t get any better for them until they get a little bit of power themselves further down timewise.

    But also M&A like all types of business who you know plays a great role. Most people that get into IB (M&A) have connections. But so do the rest. In your early days have strong connections can be a safety net for an analyst to be shielded by a trigger happy associate to dump work on him. I have seen analysts at the “right places knowing the right people” going back home at 8pm even on busy period while others burning the midnight oil.

    And if you’re not in it for the money in M&A I doubt it you are in it for friendly working hours…

  21. The author wants to open the eyes on the world of investment banking, but replenishes the article with several common places. An MBA student with no-experience in i-banking could have written this

  22. For me main points to consider :
    a. On lifestyle :
    – you have no control over your schedule (analyst or associate) when the team is busy;
    – your ability to develop friendships or love relationships is limited to the people who can understand your constraints and accept them;
    – you can travel during holidays thanks to a high salary and low spending during the year;
    b. on income:
    – base salary is by far enough once you reach Associate level to have decent standards of living in deliriously expensive London;
    – you have more options at age 28-30 if your priorities change (family, lifestyle…) because you have saved Eur 300-400k during 6 years in IB and your situation is thus a bit more stable
    b. on career:
    – in advisory, the way up is long and tedious, it is more or less 3+3+6 years to make it to MD
    – some firms tend to consider you less an expendable asset than others, but it also comes to how your relationships are with colleagues
    – this is NOT a world of sharks at junior level
    – the financial industry is very diverse, so if you do not want to work in advisory for some reason at some point, you can do something else because the set of skills is common to most jobs

  23. He is right .. about the bosses that you have at IB .. these guys are way insecure and do not really care about their reports…
    I have been working in IB for a long time …made all the compromises that were supposed to be made .. but now i realise that one more Hermes tie or a new house is not worth the life that i lost because of this job.. Don’t underestimate the power of relentless brain numbing work done for ungrateful people and companies at IB

  24. I’ve just applied to a few grad schemes in IB, can any of you bankers give me an honest insight into the day to day reality of the job?

  25. Mr. Loser,
    if u have genuine interest this is the most exciting industry to be in. every day is an adrenaline shot. hours?? differs a lot between european and US IBanks and between NY and London. So in the matrix european banks in london are good for work culture and hours. also they lead the pack in sterling denominated DCM.

    Real estate IB Reply
  26. David if your book is as boring as your article then you’ll be worrying a lot more about repaying that loan..

  27. Another question, all the bad things are related to M&A (aka corporate finance-IBD) or it is for Equity Capital Markets and Fixed Income?

  28. Pathetic article. Investment banking isn’t for weak people like David. What were you expecting? Someone to pay you for sitting on your tail all day? If you want a job like that, go work as a receptionist and take your 20K a year. If you weren’t prepared to put in 12+ hours a day, why did you get in? Could have, would have, should have. There are plenty of us who love our jobs and wouldn’t trade them for anyhting else.

  29. Analyst/Associate years in IBD are often considered a necessary step into other transactional based roles (PE, hedge funds). It is “time in jail” and most will leave after a few years, but life after that can be very nice. The IBD learning curve is also pretty low, I learned more in 2 month of PE than in 4 years of IBD.

  30. Banking sucks? Not likely. M&A sucks, maybe.

    I went from PhD student to quant trading, and all I see is upsides: you get paid for what you do, you get competent infrastructure support (not underpaid, overworked academic sysadmins), the intellectual challenges are if anything more intense than anything I’ve seen in academe, you get a lot more human interaction, and idiots don’t last long – so you get a lot of competent, smart colleagues.

    Yes you have to make that job your life as long as you are in the industry – but for me that’s a plus.

    And of course, there’s the free beer every Friday once markets close, and the weekend is my own – let the M&A people pull their all-nighters.

  31. I go to school with this guy. He was a former banker, he did write a book, and he did go back for his MBA after going into another job after I-banking. This site would not have asked him to write an article if he was full of it.

  32. Granted, analysts are treated like crap associates do not fare much better. I started as an analyst in 1997 and made to director at a top tier bank. I now enjoy “beating” my old buddies who cover me on the “more relaxed” corporate side – I am now head of M&A of a EUR 5bn company.
    Investment Banking is tough, I can’t remember anyone saying that it is:
    – easy
    – fair
    – healthy
    I do remember plenty of people saying you will be financially rewarded for your efforts. This promise was kept in 9 out of 10 years. At the end of the day, there is no other industry that will let you build equity (for your house, retirement, or what ever) at such and early age. Furthermore, especially in M&A, there is no better training ground for the corporate world you will one day enter. As an M&A banker you are far ahead of everyone on the corporate side – it is just unbelieveable.
    I would do it all over again!

  33. Life is always tough if you give up. I have worked for 10-12hrs a day, while I was working for CRISIL. I worked there more than than the office hour, without getting any compensation for overtime. But was important was the people around me, let it be my colleagues, manager, head. Its the work environment that make your work life different; this also help you to work for a better life and not just for money.

    Sampat Bhansali Reply
  34. You think you won’t work your #$@% off doing your MBA? The corporate world can be just as cut-throat. Worse yet, you can still work insane hours and not get paid for them. Little job security and fewer choices if you move on. Moving up the Corporate Ladder isn’t always based on merit. Or try an entrepreneurial path… that one is 24/7 and no money for the first few years. I think you had it pretty good. Working hard is better than being bored. PS Baldness is hereditary and take the stairs instead of the elevator.

  35. He is just so right !!!

    Damn it !!

  36. IBD = strong Excel Skills, the rest is irrelevant >&_&<

  37. Are you the Star?

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