How difficult is the life of an investment banker?

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Few people shed tears when the bankers lost their jobs.

Last Monday, stock teams in Deutsche Bank offices around the world were asked to leave their office in a matter of hours.

The dismissed men and women had worked for one of the largest investment banks in the world.

Some Deutsche Bank employees have not been popular in recent years.

In April 2015, the bank received a record $ 2.5 billion fine for rigging Libor, an interest rate used for interbank transactions. It was also ordered to dismiss seven employees and was accused of obstructing regulatory authorities in their investigations.

Stories of arrogance and misconduct abounded. Three years ago, it was reported that a member of the Deutsche staff had been suspended for allegedly waving a £ 10 bill in the windows of the bank in London and mocking doctors and nurses protesting against the NHS .

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"It was humiliating"

But now, slaughtering has resumed, as it does about every ten years in the banking sector: in 1987-1989, then during the ups and downs of the Internet bubble in 1999 and 2000, and then during the financial crisis and now, for some, in 2019..

In those years, little has changed in the way bankers get fired.

Peter Hahn, Professor Dean and Henry Grunfeld at the London Institute of Banking and Finance, worked for two of the largest US banks in the 1980s.

He recalls being on the job and seeing colleagues stuck on their arrival at the office on a Monday morning, their ID card in front of them and the order to leave the building within two hours.

Mr. Hahn said: "It was humiliating, it was two weeks before Christmas and 25% of the staff had been laid off." The returnees were receiving two weeks' pay for each year of work. were handed over a few days later had left to those who remained ".

And then?

And where does a sacked banker go? The obvious answer is to dive back into the industry.

For this generation, it might not be so simple.

Traders who have been at the forefront of reductions are among the most skilled in the industry. But unlike badysts and managers, these skills are not easily transferable. And the market is tight.

Logan Naidu, founder and general manager of the Dartmouth Partners recruitment consultancy, said: "Deutsche has closed its equity division and I do not think the market is big enough to swallow all these jobs."

And he pointed out that in a saturated market, Deutsche staff might not be able to command the type of salary he was used to.

And in general, these were high.

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Only the brave …

Sarah Butcher, Editor-in-Chief of the eFinancialCareers Banking Careers website, said: "In the first year of university, new employees can expect to earn £ 74,000 in total compensation. Senior badociates, they can expect to earn £ 225,000.

"At age 32, as a third-year vice-president, you should earn £ 435,000 in combined salary and bonus."

But for every twenty people working in a less lucrative sector, say, at £ 35,000 a year and intoxicated with the idea of ​​bank wealth, Butcher warns, "First of all, you'll be working a lot harder in an investment Think about 80 hours, late nights and some weekends.

"Second, only the brave survive.

"It is not uncommon that at least 50%, often more, of a clbad of badysts drop out of their studies at the badociate level.It is difficult to get into a bank. these pay levels are even more difficult. "

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contacts

But these former employees of Deutsche Deutsches have another thing on their side: the contacts.

Mr. Hahn tells the story of a former student who, after working for years for a major US bank, arrived one morning to be denied access and was asked to leave his home. office before 10 o'clock. He had been scheduled to go to Geneva that afternoon to talk to a client.

Mr Hahn said: "As he had the ticket and the hotel reservation, he still decided to go there." He had only to pay the taxi since the day before. 39 airport.

"He went to Geneva, saw the client, thanked him for all this business and told him that he could no longer represent the bank." Then the client offered him a job, starting with at once."

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Packaged program

There is no shortage of new recruits in the industry. Last year, Goldman Sachs had 100,000 candidates for 500 places in its trainee program.

Marcus (fictitious name) is 25 years old and works as an badyst at a major US investment bank.

He works from 13 to 14 hours a day and is very happy to do so. This is not quite so, he says, that he did when he arrived and wanted to prove himself.

He said: "The number of people wanting to enter the industry is higher than ever, but the difference from a few years ago is that university graduates – they want earn a lot of money – have more options.

"They can access technology industries and start-ups, which offer what they might consider a better lifestyle, as well as a more exciting career."

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A new generation

Naidu agreed, adding that even in the next five years, some players in the banking sector are considering moving to a more prestigious job.

He said: "This generation, Generation Y and Generation Z, are not afraid of making money, they do not seem to want it as much as the previous ones. for now, are more willing to look elsewhere and take risks on wages. "

Marcus added, "I am very happy in my work and I do not see myself moving, but again, I can not say with certainty that I will always work here because you never know what could happen."

Marcus will be well suited to everything "turns". Mr. Hahn thinks that a banking education of more than 20 years prepares you for any type of career.

This is certainly healthy for the individual, but for the banks, the disadvantages are enormous. Hahn said: "In the early 1980s, when I entered the banking sector, you expected to join a bank and keep it for your career, which resulted in loyalty to the organization.

"If you saw someone doing something terrible, you were ready to do it, because it was a threat to the organization." Now that loyalty has disappeared, and in an organization based on risk management, it's a real challenge. "