The path to becoming an investment banking associate

There are several different paths into the lucrative world of investment banking. Usually a graduate with a bachelor’s degree enters the profession as an assistant or a junior investment analyst, but a master’s degree is normally required if you want to start off your career in the more senior and better paid investment banking associate position.

An alternative path to become a banking associate is via promotion within the bank after three or four years of successful work as an analyst. The difference in salaries between associates and assistants is significant.

Although investment banking salaries are not escaping the negative impact of the recession, investment banking associates’ salaries have retained their proportional lead over the salaries of the assistants. Before the onset of the current economic downturn the assistant banker could expect to receive a starting salary of approximately $65,000 per year, and in contrast starting salaries for investment banking associates were often well over $100,000 in the United States.

Although the investment banking associate receives generous remuneration, their position is still a relatively junior one in the hierarchy. As the job title suggests, the associate occupies a secondary position to their manager. They do not have their own clients but concentrate on learning how their boss manages clients’ investments and they also try to familiarize themselves with the bank’s organizational structure and personnel.

Associates are expected to assist the boss, for example by arranging meetings and providing logistics support. If they make themselves very useful and come up with some good ideas they stand a good chance of getting promoted to a more senior banking position after a few years.

The attitude the banker displays towards the associate plays a major role in determining whether this stage of an investment banking career is going to be a positive learning experience or a test in dealing with an abusive an unappreciative colleague.

The abilities that count in becoming a successful associate banker are similar to those required for other senior banking positions. In addition to an aptitude for figures, highly developed networking and negotiating skills stand behind the associates who thrive in this tough environment and rise to the upper investment banking echelons.

Additional talents that go a long way include accurate analysis of what is happening in the finance markets and in the clients’ trading areas. A highly organized approach to monitoring markets and recording date is also demanded, and today this necessitates an excellent level of computer literacy.