“We’re told that Bearpont Morgan Chase is moving over a third (50/133) of its incoming IBD class over to the commercial bank. Apparently HR has been telling the demoted that their sentence will last one year, at which time they’ll (hopefully) be brought back over to IBD.”
With news last week of JPMorgan transferring over a third of its incoming investment banking analyst class to the commercial banking side, there are some extremely panicked, recently graduated seniors running around.
If you have been affected, what do you do? What if you lost your summer internship or full-time job entirely?
Some have theorized that JPMorgan and other banks hand-picked people to be transferred based on work experience, GPA, university and other criteria.
I don’t buy into this for a second. Bankers are lazy when it comes to firing people; they like to make it quick and avoid dragging things out.
Reviewing an analyst class of close to 150 to try and match everyone up with the appropriate divisions would be a massive undertaking, and I just don’t think the bankers themselves or even HR (yes, they might occasionally do something) would take the time out to do this.
It’s more likely that the moves were indeed random and that the analysts were “picked out of a hat.” If you’re affected, you could not have done anything to prevent it.
What To Do
I’ve received email from summer interns and incoming analysts who are panicked about what to do. If you get transferred to private wealth management, should you drop out of finance altogether? Go to another bank?
No, you shouldn’t. Instead, be happy you still have a job. With the layoff count now at, oh, 65,000 or so on Wall Street, most people who have been “restructured” lately are now in job hunting mode.
Personally, I’ve seen many friends get laid off in recent months and not a single one of them has found another finance job yet. Some are (gasp) even moving to “industry.”
Instead of dwelling on how you were unfairly transferred, you should instead use the time to network, get to know people throughout the bank and position yourself so that you can move over when the opportunity arises.
Build It Before You Need It
Turnover in finance is higher than almost any other industry (except for maybe law), and you never know when someone’s going to leave unexpectedly.
Banks may not be doing much new hiring right now, but if people leave unexpectedly they will usually try to replace them – and if they can do it internally, all the better.
This is why it pays to stick around and network as much as possible – you never know when an opportunity to move over to investment banking will open up.
Quitting if you get transferred does not make any sense – it won’t be any easier to find something if you’re out of work entirely, and you should instead use the time to build your skills and resume.
If You Get Cut Entirely
If the worst happens and you get cut, either from your internship or full-time position, you’ll have to consider “strategic alternatives.” I would recommend against sitting around for the summer or doing a typical summer job such as retail or life guarding.
Try to find something relevant that hasn’t been affected quite as much by the downturn – although some poke fun at accounting, it’s a critical skill in banking and working at the Big 4 could actually be a decent experience down the road.
Consulting internships and anything else in finance (asset management, private wealth management, etc.) would be similarly useful, and even a sales or marketing job at a normal company could be spun positively on an investment banking resume.
These are more viable for full-timers who have had their offers rescinded; it would be near-impossible to find a summer internship at this late stage.
Rescinded Summer Offers
If you had a summer offer rescinded, there are still options even at this late stage. As I wrote above, do not sit around doing the “typical” jobs that college students do.
Other, better options: study abroad (great for resumes and investment banking interviews and yes, you might be able to apply, even now), volunteer work (either for a nonprofit or literally volunteering to work somewhere for free), or starting something on your own (doesn’t have to be a company, it could be a student group or organization or even a website).
None of these puts you in as good a position as an actual finance internship, but they’re all significantly better than doing the typical summer job.
The Dirty Secrets Of Investment Banking
Part of the reason I started this site was to give an honest view of what working in investment banking at the junior levels is like.
With all the market turmoil recently, there are 2 conclusions that come to mind that no one in HR or at those cheesy recruiting events will tell you:
1) The industry is cyclical.
When times are good, they’re really good. Bonuses reach record highs; banks are fighting each other to recruit people; and people hop from bank to bank seeking the best offer they can get.
There was a great article in Bloomberg awhile back on this very topic. To anyone outside the industry, the hiring practices in finance would seem absurd: hire an excess of people in boom times, pay them an obscene amount of money, and then fire them all when the market gets worse.
As the article suggests, a better solution would be to adjust hiring practices so that banks don’t hire excessively and then adjust salaries and bonuses – rather than headcount – when the market turns.
2) There are no guarantees.
This one is easy to lose sight of when you’re in school, because there is a fairly obvious correlation between effort and success: study and work hard, and you get good grades.
In the real world you may not get what you’re looking for all the time, no matter how hard you try. This is just one of those things you have to learn, and if you’ve been negatively affected by the downturn, you should be fortunate you’re learning this lesson early in life when misfortune is easier to fix.
I don’t want to end on a depressing note, so just keep in mind that the market will come back eventually. And hey, 2008 bonuses might not be that bad.…