Investment Banking: The Lucrative Career in Finance
Investment bankers are rated as highly-skilled professionals at financial institutions. They examine the clients’ finance conditions, capital needs, and objectives. Accordingly, they recommend a strategy to enhance or manifest the results.
To summarize, investment banking indulges in creating capital for companies, governments, and other related entities. They act as a middle-man between the organization looking for ways to raise capital and the investors who are looking to make financial investments. Some of the significant activities include the sale of securities, equity securities, help mergers and acquisitions, underwrite debts, and broker trades for investors.
Get to know in detail about the roles and responsibilities of an investment banking professionals.
Roles and Responsibilities of Investment banking professional
The role of investment banking professionals is risky and interesting at the same time. It calls for due diligence in each activity they conduct. The main roles include:
- Assist the select company, organization, government or their agency to raise public or private money through debt and or equity
- Construct a detailed financial model with due diligence to support Merger and Acquisitions (M&A) transactions
- Support Financial Planning and Analysis (FP&A) communications
- Check analyses using methodologies such as discounted cash flow, leveraged buyout (LBOs), trading and transaction comparisons.
- Engage clients and new business through thorough industry knowledge and research
- Manage the transaction process from opening pitch to closure of investment contracts.
The roles and responsibilities of investment banking professionals are heavy and stressful. However, the advantageous part is that they are the ones who get paid for their due diligence job. Their market worth over time is changing and is highest. Know the salaries of investment bankers here. Mention not say, the professionals holding investment banking certifications are preferred and paid more as compared to their non-certified peer group.
Average Investment Banker Salary
Investment banking is a lucrative career. You may start your career as an analyst and progress further as associates, then the director or managing director.
According to PayScale,
- Salary of an entry-level Investment banker with less than one-year experience is USD 72,873.
- An early career Investment Banker having one-four years of experience earns an average compensation of USD 89,719.
- A mid-career professional with five-nine years of experience earns an average salary of USD 123,675 per annum.
- In their late-career (20 years and higher), employees earn an average compensation of USD 137,569
The popular employers for investment banker J. P. Morgan Chase & Co. give USD 98,000 whereas The Goldman Sachs Group, Inc. gives USD 125,000. Employees at Houston, Texas earn 26.6% more than the national average and the lowest salaries are found in Chicago and Illinois with 27.1% less salary.
According to corporatefinanceinstitue.com, the salary of an analyst is USD 125K-200K; associate id USD 180K-250K; vice-president is USD 220K-400K, and the managing director is USD 500K-10M+.
According to the Bureau of Labor Statistics, a financial analyst, technically involved in investment banking earns a median salary of USD85,660 in Sept.2019.
After New York, London provides the best salary in the industry. The base salary for an analyst is £50,000, and the average bonuses are £30,000-£35,000. In India, an investment banking analyst earns INR 414,372 per annum.
Investment banking is one of the premier fields in finance careers. Shape your future career, if a finance career is your destination.