Some banks have been explicit about it. Credit Suisse has specifically stated that it wants to get rid of expensive senior staff and replace them with juniors. Bank of America Merrill Lynch is being more covert, but it too appears to be clearing out expensive senior staff to make way for new hires.
In the circumstances, it should be a source of concern that are 92 people graduating from the London Business School’s MBA programme this summer who specify investment banking as their chosen career path. Almost all are entitled to work in London.
If you want to be able to compete with these new MBAs, you will need the following credentials (it will also help if you have these before embarking on an MBA in an attempt to transform your career).
LBS MBAs don’t state their age on their CVs, but the average age of an LBS MBA is only 29 years.
Even at INSEAD, where age profile appears a little older, only 12% of MBAs are over 30.
Around 83% of LBS’s 2012 MBAs who want to go into banking speak another language other than English – many fluently. Most do not have English as their first language, but speak enough English to understand complex MBA classes.
3. Prior relevant blue chip experience
We picked 18 CVs of the MBAs who want to work in investment banking at random. Almost all had prior financial services experience. There’s a former bulge bracket associate with a first in maths, a former employee of a majorUSprivate equity fund, a fixed income trader and credit derivatives structurer with 7 years’ experience at European banks. Some have worked in established financial services firms in their home countries (eg. Brazil).
MBAs aspiring to investment banking who haven’t worked in financial services previously have worked in consultancies like Bain or McKinsey.
4. Supplementary qualifications
It’s not unknown for MBAs who want to get into financial services to also have MScs and full CFA charters.
5. The right to work in the EU
As immigration laws are tightened, it seems almost every MBA graduating in 2012 has a right to work in the European Union. Our analysis suggests only 20% don’t. If you’re a non-EU citizen who’s fallen foul of the new laws, you will be at a disadvantage.
Most of all, the coming crop of MBAs have the advantage of comparative cheapness. The average starting salary of a graduate from LBS is £95k. Mean total first year compensation for an LBS MBA going into finance last year was £139k.
If you cost considerably more than this, and are not more than justifying your compensation then you have been warned. The only good news is that the enthusiasm for investment banking among LBS’s 2013 MBAs appears far lower: only 29 say they aspire to careers in the sector currently.