Banking & Finance

by Derek Loosvelt | March 10, 2009

The UK banking and financial services sector is one of the crown jewels of the UK economy, especially since much of the UK's manufacturing base has receded. Many graduates are drawn to the UK's financial sector by the hope of handsome earning power, particularly as student debt continues to grow. Job opportunities in the banking and finance sector straddle four main areas:

 

  • Asset management and investment banking
  • Insurance
  • Retail banking services including commercial banks
  • Actuarial services

    However, the distinction between these categories is getting increasingly blurred. For example, some retail banks offer a conventional range of banking services to the public. Others may offer a more boutique offering to wealthier private clients, including stockmarket investment services. According to the UK Securities & Investment Institute, the UK banking and financial services industry contributed to 8.5 per cent of UK GDP in 2006. The industry employs more than one million people, including more than 300,000 in Greater London. Despite the introduction and success of the euro common currency on January 1, 2002, London has maintained its position as Europe's premier financial centre.

    Who gets hired?
    Those with an above average degree, basically a 2.1 or above, from a good university, will generally meet the minimum application requirement. MBAs and other Masters degrees, as well as additional languages are definite pluses to your application as well. The banking and finance industry is wide-ranging, requiring many different skills. Like most industries, employers want an effective team player, so you will need an abundance of technical skills as well as social skills that you can deploy adroitly with clients. Most blue chip companies offer a wide-ranging graduate programme, enabling you to work in a variety of departments.

    The industry's work ethos, which can include notoriously long hours, particularly for analyst and broker positions, can be daunting. However, the rewards are generally considerable, although often at the expense of an active social life. That said, social and communication skills are crucial for those working in banking and finance, as much of your work involves communicating with co-workers and clients. You will also have to get used to continual exams. The UK financial and banking industry is highly regulated, and there will be times you will have to study for examinations outside of work hours. Simply remember that your hard work is what supports your way up the career ladder. According to graduate recruitment personnel at the top investment banks, as well as officials representing The City of London, the nation's financial hub, average investment bank salaries for graduates started at #35,000.

    Which job role?
    There are plenty of jobs in the industry for graduates and young professionals of all backgrounds, including:

    Corporate finance analyst
    Corporate finance analysts perform industry research to highlight expansion or acquisition opportunities within the company's existing business or expansion into new business markets and then analyse and evaluate the potential acquisitions on a financial and transactional perspective, developing detailed financial and risk valuation models.

    M & A analyst
    M & A (Mergers and Acquisitions) analysts, as they are known, assist in the evaluation and analysis of proposals for acquisitions, disposals, joint ventures and strategic alliances -- as well as their negotiation and execution -- to optimise a company's financial gains. This includes dealing with in-house and third-party legal advisers and monitoring all transactions, and preparing strategic reviews after the deals are completed.

    Equity capital markets analyst
    ECM analysts work closely with senior investment bankers and clients' senior managers to assist in the initiation and execution of equity and equity-related offerings. They support investment banking pitch efforts, maintain weekly databases and market updates, produce follow-up analysis for lead-managed deals and assist in continuous product development and support, from the origination of a deal through to the final stages of completion.

    Actuary
    Actuaries help organisations anticipate how they plan and manage their finances so they can handle the financial demands and risks of their employees. It is not just working out how long their employees will keep breathing (and paying them a pension). It may include issues around employee benefits as well as mergers and acquisitions activity and capital projects. It is also a role with a strong writing element to it with plenty of exposure to legislative change, statistics and client contact.

    Foreign exchange trader
    Prepare for a 7am start because this is not a job for late risers. Foreign exchange dealers manage currency and other commodity risk to help companies and even governments to spread or offset their financial risk. The job is highly pressurised with traders having to respond fast to political and, increasingly, environmental crises. Traders handle huge amounts of money and their earning potential is fantastic.

    Research analyst
    Analysts are responsible for researching, compiling and analysing reports for corporate clients. The role entails assessing companies' financial performance, strategy and growth prospects and communicating your conclusions in a clear, concise manner. A willingness to put up with long hours and demanding deadlines is taken as a given.

    Risk manager
    Financial deals get increasingly complex, not to say risky. That means financial companies often employ risk managers to assess the risks they face, be it legal, credit, operational (human error or a lack of proper internal controls) or more generalised market risks as a whole. This is a growth area within banking with strong advancement opportunities.

    Stockbroker
    A stockbroker advises clients and often fund managers on which companies or stocks to invest in. It's a role that is increasingly about portfolio asset management and examining a client's overall exposure to risk and markets. You will need strong analytical skills and interpersonal skills and are able to get on with a range of demanding clients. It's an interesting role too, often meeting chief executives or senior management of a broad range of companies. You will need to pass regular examinations to progress.

    Compliance officer
    A compliance officer's job ensures companies don't stray outside legal parameters set by the UK's Financial Services Authority. They deal with day-to-day marketing material with much employee contact, often questioning staff judgement and enforcing decisions and ensuring everyone abides by increasingly stringent rules. It is also a job with close involvement with human resources (HR) and management. It is a highly responsible post and decently remunerated too. Law degrees are a good starting point for this role.

    Retail banking
    While working in retail banking may not be as high-profile as being a City stockbroker, you will have a lot of responsibility thrown at you from day one. Retail banking is about hands-on customer service, HR challenges, generating income and meeting sales targets. Banks usually make sure that their new graduate employees get a very broad spread of experience, not just on the shop floor but also within management. Banks often have corporate social responsibility obligations so you'll also represent the bank as part of the wider community.

    Don't forget there are a wealth of other roles available to graduates in the banking and financial services sector, including opportunities for economists, marketing and public relations professionals and IT personnel, not to mention lawyers.

    The main players
    The main graduate employers in the UK financial and banking industry are investment, commercial and retail banks, most offering strong graduate training programmes, sometimes even within their own residential training colleges. Often these posts lead to more specialised positions, or to areas like marketing and HR.

    Other growth areas with strong graduate programmes include organisations like the Financial Services Authority. The growth in financial regulation, particularly since the Enron/Arthur Andersen scandal in 2001, has also meant tighter money laundering regulations generally.

    The UK banking and financial sector is expected to continue its period of growth. Much of this is predicted to come from Asia. As the Chinese and Indian economies develop, significant amounts of savings are predicted to flow towards London generating new services, profits and possible career opportunities. However, although most of the action is down in London, you do not always need to head for the City in order to work in the UK's financial services sector. There is an abundance of opportunity in other parts of the UK, notably Edinburgh (fund management) as well as Birmingham, Cardiff, York and Bournemouth.

    Companies with strong graduate training programmes include Barclays, UBS, Goldman Sachs, Merrill Lynch, JP Morgan, HBOS, RBS, Lehman Brothers, Citigroup, HSBC, Deutsche Bank, Lloyds TSB and Credit Suisse.

 

Filed Under: Finance


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