The challenges and opportunities facing the investment banking intern

The chance to work as an investment banking intern continues to be seen as a golden opportunity for many graduates, despite the falling salaries and disappearance of bonuses that have characterized the current severe world recession. They view the economic downturn as a passing turbulence which should not be allowed to color their view of investment banking, and they anticipate that a graduate with a good master’s degree will soon again be able to earn as much as $150,000 per year.

Evidence for the popularity of these openings is abundantly available in the increasing number of finance-related degree courses including a summer investment bank internship in their programs. From the bankers’ perspective these investment banking intern programs allow them to assess practical working and interpersonal skills and recruit whoever they consider most suitable to join their team.

Who qualifies for an investment bank internship?

As a rule only university graduates have access to investment bank internships. Although the typical investment bank intern is going to have a degree in finance, accounting or some related subject, good graduates with degrees in other subjects are also accepted.  Masters degree graduates are preferred over those with lower level degrees, and where there is tough competition for internships the applicant’s degree level is going to count. 

There are still a small number of clerical positions available for school leavers without degrees, for example in England those with good “A” level grades may be taken on as clerks; this can also be considered a type of internship because it gives the bank a chance to check their suitability for promotion to investment analyst, investment banker associate and more senior banking positions.

The investment bank intern’s duties

The typical intern provides assistance to senior managers including a range of research, financial modeling and marketing tasks. They provide logistical support to the investment bank managers and are able to participate in networking with the bank’s clients. From their inside position in the bank they can learn how the analysts draw up company valuations and identify business acquisition targets. There is a great deal to learn and you are expected to put in the time required.

One of the reasons why some interns do not progress beyond the internship stage is that they want to finish their day’s work at 6:00 or 7:00 but this does not fit in with the investment banks working culture where new employees can be expected to regularly work 90 hours a week or more.