If you want to work for an investment bank (and you know nothing about it), you might think it's just a matter of sending in your application at the start of the third year of university and hoping for the best.
You'd be wrong.
Investment banks are some of the most competitive places to get into in the world. If you thought getting into an elite university was hard, try getting into Goldman Sachs: the acceptance rate at 'the firm' is just 1.8%, compared to 5.2% at Harvard University and around 20% at Cambridge.
If you want to get into an investment bank, you need to plan ahead. The recruitment process starts way, way before your graduation year.
1. Apply for events, insight days and spring weeks: your first year at university
If you want to work for an investment bank, you need to spend your first year preparing the ground.
In particular, keep a look out for the 'events' banks run on campus, or online. These have become an important way for banks to identify promising students at an early stage. J.P. Morgan, for example, offers schools insight days, campus dinners (on universities) and LiveTalks via its careers site. You can find out about events by visiting banks' careers pages. Goldman Sachs, for example, has an area titled 'My GS Events.'
You also need to apply for the 'spring weeks' run by most banks in Europe at Easter. These are specifically for first year university students and can lead directly to a summer internship in your second year. Our research suggests that 25% of the places on some banks' summer internship programmes are assigned to people who were previously 'spring interns'.
“Applying for the spring weeks puts pressure on you in your first year, but makes life a lot easier after that,” one student told us. "The spring internships give candidates the opportunity to secure summer internships earlier and be better informed about where their skillsets and interests might best fit," says a spokeswoman for J.P. Morgan.
While insight days and 'orientation events' are run throughout the year, you will normally need to apply for a spring week by January or December, so keep a look out for deadlines on banks' websites.
Whether you do a spring week or not, John Craven, a former director of structured products and cross-asset solutions at Merrill Lynch and SocGen, who now helps non-middle class students get into banking jobs, says your first year at university should really be spent finding out about the industry and establishing exactly which sector you want to work in (our graduate guide can help you here) and exactly which bank you want to work for.
2. Apply for a summer internship: your second year at university (first term)
Once you know what you want to do in banking, you can devote the first term of your second year to applying for summer internships (known as "summer analyst programmes") at different banks in that sector. It's this second year summer internship that's "crucial" to landing an investment banking job when you graduate, says Craven: "Banks want to hire people they've tested the year before."
Application deadlines for summer analyst programmes are typically late December. In Europe the Middle East and Africa, for example, Goldman Sachs requires that students apply for its summer analyst programmes by December 4th. This year, J.P. Morgan is opening applications for its summer analyst programme on August 1st and closing them on 27th of November. "We encourage candidates to apply as early as possible in the season because we recruit on a rolling basis," says the J.P. Morgan spokeswoman.
Getting onto a summer analyst programme is not easy. Banks are incredibly fussy about who they hire for summer internships. If you want to get one, you'll need to go through the process below.
i) Fill in the application form
The actual recruitment process varies from bank to banks. Most banks use application forms but some - like Goldman Sachs, have historically preferred a CV and a cover letter.
The application form is the crucial filtering mechanism in banks' application process. This is where most of the unsuccessful candidates are stripped away. To succeed, you'll need excellent academics. In the UK, this means an average of 530 UCAS points, plus a degree class of 2.1 or above (usually from a top university). You'll also need the right kinds of extracurricular activities. Banks don't just want people who've participated in finance societies, says Craven - they want people who've taken leadership roles in those societies. Academic studies suggest banks like to hire students whose extracurricular activities resonate with the bankers interviewing them: skiing, skuba diving and tennis all count highly (especially if you were a team leader at university). So does taking time out to work for an internationally recognized volunteering organization.
ii) Complete the psychometric tests
Until now, banks have been big on psychometric tests. In Europe especially, numerical tests were often bundled in with the application form. If you passed well, you'd be in the top third of candidates and go through to the next level. If you failed, your application would be terminated.
Now, there's a sign that things may be changing. Goldman Sachs doesn't do numerical tests and J.P. Morgan has dropped tests from its application process. Banks are trying to be more open-minded about who they recruit and doing away with prescriptive numerical tests might be a part of this. At the same time, however, Goldman is thinking of introducing a "personality questionnaire" to its recruitment process, suggesting that more emphasis is being placed upon hiring the, 'right sort of person.'
iii) Wait for the telephone or video interview
In 2016, there's a new stage in the banking application process: the video interview.
In the past, banks often conducted their first interviews by telephone. Now, both Goldman Sachs and J.P. Morgan are making the most of up to date video technology. Using a webcam, you will be asked to record your responses to pre-recorded questions. The intention here is for banks to interview far more candidates than in the past.
Goldman Sachs is using HireVue for its video interviews. You can see tips on how to do well in a HireVue interview here.
In most cases, HireVue interview results are analysed by a computer algorithm. However, Goldman's head of HR Edith Cooper said this doesn't mean you can game it: "If you go in there with a script because that’s what everyone says you’re supposed to say it doesn’t take long for people to figure out what it is.”
iv) Get invited to a second interview or assessment centre ('super day')
If you make it past the video interviewing algorithm you can expect to be called back for a more rigorous interview process. At J.P. Morgan in EMEA, this means an assessment centre. At Goldman Sachs, it means endless "structured interviews".
"Goldman is all about round after round of face-to-face interviews – there’s a big emphasis on character and being the sort of interesting person they want to work with," says one ex-Goldman Sachs recruiter.
If you're interested, we have a full list of every conceivable question you could be asked at a Goldman Sachs interview here.
v) Complete the internship, get an offer, and turn up for your banking job after you graduate (ideally)
If you make it through points i to iv, you can expect to get an offer to attend a 10 to 12 week summer internship or summer analyst programme. Simple? Not exactly.
Once you've got a summer internship, you'll still need to come out of it with the offer of a full time job. - To "convert" it in banking parlance. This can be easier said than done - especially in years when banking revenues are low and banks decide they need fewer graduates. We have advice on converting a J.P. Morgan internship here, and a Goldman Sachs securities internship here.
3. Apply for full time graduate jobs: your third year at university
If you fail level 2 and don't convert your internship - don't get a full time job offer for after you graduate, you'll need to start all over again. This means, applying for scratch for full time analyst jobs during your third year at university. Unfortunately, you'll have to go through the application processes i to iv (above) all over again.
Deadlines for full time jobs ('analyst positions') are usually in October. Goldman's full time deadline is October 30 in EMEA.