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Graduate Programmes
It’s true – banks are still hiring!
9 May 2008Forget $178bn of writedowns and weekly redundancy announcements, investment banks are still sucking in graduates.
According to the Securities and Investment Institute (SII), the number of banking trainees registered for its entry-level examinations this year is down only 6% compared to last year.
Given most trainees take the SII’s exams, the implication is clear: banks haven’t slashed their graduate hires this year after all.
This is particularly impressive when you consider that their graduate intakes rose 20% between 2006-07.
Why are banks still so keen?
It might just be a question of delayed reactions. Banks would have decided how many graduates to hire for 2008 back in the summer of 2007, when subprime was a mere germ of a problem.
Brian Hood, head of graduate recruitment at Citi, says: “There are areas of the business where hires have increased – such as technology and corporate banking – and some where numbers have fallen. But generally it’s small movement, and the numbers have remained flat overall on 2007.”
Steph Ahrens, head of graduate recruitment at Morgan Stanley, says: “A lot of the cuts will be coming in more senior posts. Banks still need to develop future talent and as such entry-level positions shouldn’t be affected.”
What about 2009?
Hiring may be steady in 2008. But will it hold up next year?
Ahrens says: “My feeling is that numbers will fall slightly in London and Europe. However, we will be upping our recruitment in areas like the Middle East, Eastern Europe and emerging markets.”
COMMENTS
Matt, Wed 14 May 08
Definitely HF. Most finance students seem quite aggrieved by this fact. With a Masters in Investment Management I dont suddenly walk into a Law firm and try and do their job. Sounds like a good research topic for efinancialcareers to me.
Add your comment »Michael, Student, Thu 15 May 08
Absolutely, HF and Matt, I agree with you totally. The reason banks have screwed up so bad recently is simply because the staff are trained up to do their role but they do not understand finance as a whole. That's why they buy subprime mortgage debt without really thinking about the quality or the implications of doing it. When the CEO of UBS does not know what a CDO is, you realise you are dealing with an industry full of morans. Just why they do not want people trained in finance is beyond me, but some senior bankers told me its because they want you trained "their way". They tell me banks are simply big sales institutions which make money selling products which nobody understands, and those educated in finance see through this, wheras engineers do not, so they can sell and structure the products more convincingly. What do you guys think?
Add your comment »matt, Fri 16 May 08
Its interesting that I have heard that story from a banker as well. They want graduates who they can mould and manipulate so they work and follow procedures without questioning them. Whether this had a part in the subprime crisis is less clear, either way those involved are the first ones to loose their jobs. Mind you I am sure not many people in finance saw this crisis coming, they were too blinded by their bonuses.
Add your comment »HF, Hedge Funds, Sun 18 May 08
one thing is for sure, people who used to run ibanks 20-30 years ago would have understood risks inherent in structured products far, far better than quants ever can. because risk is not something that can be bound by numbers or limited by pooling it all together.
pooling different types of sh*t together doesnt mean that it wont smell. on the contrary, it will smell more and worse than anything before.
it remains to be seen whether the industry will truly learn from its mistakes and change the flawed bonus and ratings system which were some of the biggest reasons for the mess.
Michael, Student, Mon 19 May 08
HF and matt that's some real talk! Joseph Stiglitz said the bonus structure is flawed because it favours short term profit and ignores long term risk, hence the overleveraging of most consumers, businesses and governments in the USA and UK. Its true about the quants, yes they can handle numbers, but have no clue about the rest of finance, or understand the qualitative / economic / financial implications of their models. They are simply too narrow minded, hence proving the recent accusations that PHD's actually dumb you down by being too narrow and focused! Its sad that when bankers win they take home big profits, when they lose the poor taxpayers who do not have offshore bank accounts pay, that's just madness! But its smart and that's the reason why I want to be a banker, I didn't make the system, the Rothschild's did. I just want to play by the rules.
Add your comment »Azizopoulos, Student, Wed 21 May 08
It seems that certain banks are cutting students off in the middle of the the recruitement process - I passed the Lehman Brothers assessment centre in mid feb and been waiting for a date for the final interview since then. I called them many times and I was told that they are busy arranging internships. Yesterday I called and the bomb was dropped on me that there wont be any final interview as they have decided to have a smaller class this time. I dont understand the fact that why I wasnt informed of this fact and I had to call to find out, if I wouldnt have called, I would still be waiting. Anyways times are hard for banks at the moment and even if you get to the end u can expect not to be selected after passing the assessment centre and without being interviewed.
Add your comment »Michael, Student, Wed 21 May 08
I've heard Lehman gave lots of graduate offers which they had to rescind due to the losses they incurred. Nevertheless, if you got the offer you would not have made a bonus anyway, its probably for the better!
Add your comment »
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