by Brian DeChesare Comments (84)

Investment Banking: South Africa Edition

Investment Banking South AfricaWhile everyone knows about emerging markets like China, India, and the Middle East, there’s not as much awareness of South Africa.

But it would be a mistake to ignore it, because it’s an interesting market in its own right – and it’s quite a bit different from anywhere else in the world.

So let’s get started.

In The Beginning…

Q: Can you tell us about your background?

A: Sure. I owned a small engineering and IT business for a few years before making the move into finance. Back in undergraduate I had studied Computer Science and saw many of my classmates go into finance, but I was interested in starting my own business and did so with another student.

A few years into it, I got interested in equities trading but also realized that I would need an MBA to move into a new industry.

5 years after starting the business, I sold it and started my MBA program. I thought about going to a top 10 business school elsewhere in the world, but settled on something local instead.

I gave up some networking opportunities by doing that, but it didn’t matter much because plenty of banks came to recruit at our school – plus, my program was only 1 year so my opportunity cost was lower.

I interviewed around and won an offer at an investment bank that had recruited at our school.

Q: What’s the finance industry in South Africa like? How is it different from the US and Europe?

A: The main difference is the types of clients we work with:

  • They are generally below investment grade, though that’s not always true for multinationals and government-linked entities.
  • They’re almost always based in South Africa or on the African continent and have significant operations here.

Beyond that, the products are much simpler: convertibles were only introduced in 2007, and credit default swaps still do not exist.

We also have some unique products you won’t find anywhere else, such as those used to fund BEE (Black Economic Empowerment) deals.

Banks have flatter structures and there’s not much of a “ladder” – go-getters thrive and get deals, while those looking for a clear career path are often frustrated.

Even though I went for the MBA degree, it’s not too common among bankers here – most are either CAs (Chartered Accountants) or have a CFA combined with some type of mathematical degree.

And then a fair number of bankers don’t have finance degrees at all – they come from other industries and are simply good at making rain.

M&I Note: Once again, despite my bias against the CFA it may be more useful in emerging markets such as South Africa.


Q: What about the recruiting process?

Is it similar to the US with resume drops and then multiple rounds of interviews, or closer to Europe with assessment centers and in-person testing/presentations?

A: Overall it’s closer to the US – but interviews tend to be less formal and they’re more about fit rather than technical questions.

Interviewers emphasize your undergraduate major and experience, and there’s a heavy bias in favor of those with accounting backgrounds. They view Big 4 experience very favorably here.

Usually you go through 3 or 4 rounds of interviews over several weeks – many of my friends spent around 3 months interviewing before getting an offer, and it took me around 6 months.

Recruiting take longer not because interviews are more rigorous, but because of the pressure to hire employment equity candidates. Right now there aren’t even enough candidates to fill the required roles.

If you’ve performed well at a top university here you stand a good shot of landing an offer – but just like other markets, nothing is guaranteed.

Q: How do most people start working in finance in South Africa? Is it mostly locals or are they transferring in from elsewhere?

A: It’s mostly local South Africans who enter banking from university, usually studying commerce or a math-based field. Sometimes they also come in from accounting.

The employment and education demographics are heavily skewed toward those who benefited from Apartheid due to the country’s history – many others don’t have the required education.

We’re starting to get more people from other English-speaking countries such as the US, UK, and Australia, as well as South Africans returning home after working abroad.

Lately a lot of Africans from other countries like Nigeria, Ghana, and Zimbabwe have been coming here as well.

Wheeling & Dealing

Q: What types of deals are most common in South Africa?

A: The most common deals are working capital or property finance-related, with some advisory and corporate finance thrown in.

Depending on the market, there might also be leveraged finance or mezzanine finance deals – preferred stock issuances and BEE funding always slow down in recessions, as does anything private equity-related.

The industries themselves are diversified – parastatals, retailers, manufacturers, automotive, mining, telecoms, financial services, and so on. Technology is the only industry here with very little lending or deal activity, because the risk-return is poor.

Q: Can you describe the culture, pay, and lifestyle? Is it more like the US with extremely long hours but higher pay, or more like other regions such as Australia with better hours but also lower pay?

A: The hours are probably closer to what you would find in Australia, although a lot of that is determined by your group. If you’re working market hours – like a trader – then you’re there from 7 AM to 5 PM with no weekends.

Investment bankers work weekends and leave the office around 10 PM quite often, but all-nighters and working to the point of exhaustion are not as common as they are in the US.

It’s still banking, so anyone in corporate finance / M&A is told not to plan anything in advance, and 16-18 hour days are to be expected.

Q: And what about the pay?

A: Similar to other emerging markets, it’s lower than the US in absolute dollar terms but it’s higher relative to the cost of living.

You can live a very good life in South Africa on what you make in finance – though you will encounter the same issues as in other developing countries (e.g. there is high income disparity, radically different classes, and so on).

Q: Do you hang out with your co-workers? Or does everyone do their own thing?

A: Co-workers are sociable and people hang out together quite a lot. My bank also puts on a lot of company-sponsored events and sports, and we even have a sponsored bar.

There’s some rivalry between banks here, but usually people from different banks hang out together at the same places.

Q: What about exit opportunities? Do people stay in South Africa or move elsewhere?

A: Many bankers move on to executive finance roles in industry, sometimes leaving the country and going to the UK, Europe, or Australia.

Since there are so few qualified individuals here, there’s a lot of inter-bank hopping – similar to other emerging markets, there are fewer buy-side firms, so the mythical exit opportunity doesn’t get as much hype here.

The one exception is the hedge fund / prop trading industry, which tends to attract a lot of ex-traders coming from banks.

Similar to the US, it’s tough to move directly from IT into investment banking or other front-office roles and hardly anyone in those roles moves up – though there are exceptions if you play your cards right.

If you’re already in a front-office role, moving up is a different story – it can be easier than in developed markets, but as I mentioned before there’s also less of a “path” and it’s heavily dependent on your results.

Q: Great, thanks for your time.

A: No problem.

M&I - Brian

About the Author

Brian DeChesare is the Founder of Mergers & Inquisitions and Breaking Into Wall Street. In his spare time, he enjoys memorizing obscure Excel functions, editing resumes, obsessing over TV shows, traveling like a drug dealer, and defeating Sauron.

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  1. Hi

    I am currently studying a Bachelor of Accounting(CA) degree at the University of Johannesburg. I’ve developed an interest investment banking and I would like to know what moves can I make possibly after I finish this degree before or after articles to move to an investment banking career.

    1. M&I - Nicole

      I’d connect with people on LinkedIn and try to gain some relevant experience at a local/boutique firm in South Africa.

  2. Hey, so I have a 3.0( B average) from Wharton undergrad, currently a sophomore. This is bad buts it’s not scraping the bottom of the barrel, Im wondering if I have a shot at BB Investment Banking in South Africa with those sort of grades. Also note that I have As in Finance and Accounting, I just messed up my non major classes with Bs and Cs.

    1. M&I - Nicole

      Yes I’d think so given the brand name and that South Africa may not be as competitive as cities like NY/London. I’d just come up with a good explanation on why your GPA is average if they do ask.

  3. Hey,

    I’m currently a first year investment banking analyst in Nigeria working with a boutique firm specialising in Debt issuance. I transitioned laterally from legal practice into investment banking a while ago.
    I’m interested in moving to SA and would like to know how easy it is for non-SA citizens to break into Investment banking in Johannesburg/CapeTown. Thank You.

    1. M&I - Nicole

      I am not 100% sure and I will leave this for readers to answer.

  4. Young Banker

    Hi I am a 3rd year medical student who is contemplating a switch to IB(In South Africa). I would like to know if it’s best to finish my degree, of which I have 3 years left? Or switch now to Bcom majoring in finance and investments?
    I would also like to know if anybody can compare the average salary of an intern doctor straight out of University to an intern/analyst I-Banker in SA(Intern Doctors get around 25-35 Rand a month)

    1. **That’s 25-30 thousand Rand/month

  5. Hi there! Great article, very insightful!

    What are the differences in exit opportunities between management consultants and I-bankers? I believe both are valued in PE and I-bankers valued in Hedge funds. What about corporate exits into management/leadership roles?

    Also, what kind of postgraduate qualifications would you say are most required for Hedgefunds if one has a math-based undergraduate? Would the best bet be a CFA or possibly a financial mathematics masters degree?

    Thank you!

    1. M&I - Nicole

      You may find these links useful:

      A CFA or a Masters in Finance can potentially help. The links above should address your questions.

  6. Do US PE firms even consider foreigners?

    1. M&I - Nicole

      Sometimes but it can be challenging unless you can add substantial value to the firm (i.e. perhaps the fund is an emerging markets fund based in U.S. and require someone who knows the language and culture but even this scenario is rare)

  7. Hey guys. Wondering if you can help me with this one. I’m busy completing my articles to be qualified as a CA (in South Africa). I’ve also completed my first level of CFA and will do the other 2 levels, simply for the fact that CFA does carry some weight in the EMs to break into IB. After articles I intend to join corpfin division of my bank where I currently serve my articles (In SA one can serve your articles at a bank or accounting/auditing firm). My objective is to work in IB for 2-4 years before reaching the equivalent of an associate, and then going to the US and working in PE. Anything is possible, but do you guys think its feasible and if so how do I go about attaining my objective?

    Thanks in advance.

    1. M&I - Nicole

      Yes, as long as you can gain corporate finance experience by joining that division of your bank

      1. But after my time at IB in SA, how do I go about getting a PE offer in the US?

        1. M&I - Nicole

          This can be more difficult; an MBA may help –

      2. So its been approx. a year since this post. I have recently gotten into the Corporate Finance team at my bank (no.1 IB in SA based on league tables) in the Resources M&A- and advisory team using methodical steps which worked due to the informal nature of the recruitment process for IBs in SA.

        1. M&I - Nicole

          Congratulations and thanks for sharing your experience with us!

  8. Such a wonderful site!! how much can you estimate the base salary and bonuses at the top end in SA?

  9. hey.sorry I know its an old thread.I am doing a degree in Accounting and I realised that I lov Investment banking more than accounting.How can I branch into Investment Banking after my Accounting degree.thanx

  10. Great I finally found an article on the emerging markets. South Africa Nigeria Ghana Zimbabwe. I would really like to get insights on breaking into Corp Finance or I/B in such markets.

    I am in Kenya and am hoping to break into the industry (Corp Finance). I am an Engineering Final year undergrad with a CPA certification. I am trying to spruce up my resume by amassing internship credentials that will boost my prospects. I have had a 6month stint at an audit firm. I am now looking into a bank/finance dept at a beverages co./stock broker.
    M&I might you have any suggestions on what i should target particularly? Skills? Departments? That are likely to pay-off.

    I am a great fan of your site. Like others i wish i had found it earlier. I read your stuff although much of it is based on developed markets which makes it a task to relate to a pre- transition economy.

  11. Are there any South Africans on this site?

    How would a person holding a non-quant degree fair? I really feel it would be hopeless no matter how many accounting and eco’s courses I took.

    Commerce grads are like a conglomerate in this country. If you didn’t do a finance degree or one of the “hard” math related majors.

    You might as well be dead over here. They don’t want to hear anything. This is NOT a land of opportunity at all.

    Or maybe I’m paranoid. Who can tell me the cold hard truth?

    1. Not sure on that one – I think degree definitely matters more in emerging markets, but you could probably overcome it if you studied or worked in another country and had solid work experience there

  12. Jesus its pointless, ill never break in.

    I knew the whole major thing was just a myth.

    South africa is strict on math related degrees even if the blog says differently.

    Ide never break into south african investment banking purely because I don’t have a finance degree or a related quant- degree.

    what does M&A have to say about this?

    I don’t know what they can say other than it being pointless no matter what.

    Wish I was born in the U.S

    1. M&I - Nicole

      You might want to empower your situation by changing your mindset and thinking of solutions to break in, if you really want IB

  13. HK Banker

    hi I know this is an old thread and this was mentioned in the article a little bit but wondering about the marketability / exit ops of someone going to SA to other “better rated” financial capitals eg London – I’m asking cause I’m being offered an internal transfer with my firm from HK to SA and while I’m tempted, I’m afraid to lose a lot of creds to more conventional geographies where I eventually want to return (I’m European, I may have to wait a few years though!!)… any thoughts appreciated….

    1. M&I - Nicole

      Interesting one. If you’re interested in working in SA I’d go for it. Otherwise, I might stick around in HK since its still the financial hub of the world. However, I’d imagine you can be involved in some interesting MENA work which might lead you back to Europe. I think readers may have better insights to your question

      1. Thanks Nicole appreciate the feedback, I ended up not taking the offer as I believe SA still does not stack up to a more traditional financial capital like London / NY / HK… and recent events there are actually quite scary

        1. M&I - Nicole

          Thanks for your feedback!

  14. Yolande

    Hi there

    Thank you for your informative article. What would you recommend that I study to go into corporate finance/private banking sector. Obviously I could not go straight into that but I want the right degree behind me. I have been office administrator for a property company for 4 years and want to do something else with my life and want to start studying ASAP! I would really appreciate your advice :)

    1. M&I - Nicole

      I’d recommend you to read the articles on our site. If you want to understand more about finance and investments and break into buy side roles and private wealth management roles, check out the CFA – you might want to take the course. For IB roles having an internship with an investment bank will be helpful

  15. Hi
    I am a second year Actuarial Science student interested in getting into banking. From what I’ve read on this site, complicated maths is not important, so should I change to something more finance related or finish my degree? It is known as one of the hardest degrees available, will this impress bankers?

    1. M&I - Nicole

      You can try structured finance/trading roles which require heavy quant skills!

      1. If you are studying Actuarial Sciences at NWU you will definitely be able to land a job in banking after your masters. And within the company you can easily move around. Nowadays Actuaries are very equipped with Quant skills i.e. programming and financial modelling. Never give up the maths for something you can easily learn on the side.

  16. Eyy is it possible to get info that kind of info for a 3rd world country in Africa like lets say Kenya????

    Or is it the same case as SA(South Africa)

    1. Thanks for the suggestion. Most other countries in Africa do not have much of a finance industry, at least not investment banks, but I’ll see what we can find on the topic in the future.

    2. Commercial Bank of Africa definitely recruit in Kenya.

    3. Commercial Bank of Africa recruit in Kenya. JP Morgan set up an office their last year, and on the “buyside” Private Equity firm/Leveraged Buyout firm Carlyle Group are setting up an office there soon after raising a above target 650 million dollar Sub Saharan Africa fund.

  17. glam fairy

    Is it possible to tell me,which university the interviwee went to?or is it confidential?

  18. banker to be

    You don’t happen to have a list of any boutique banks in South-Africa?

    Besides the Absa, Investec, RMB etc.

    Think it might be easier if I could apply to one of the boutiques.

    1. M&I - Nicole

      This is another institution you can look at :

    2. There is a list of banks in South Africa (and Africa and the Middle East in general) in the Networking Ninja Toolkit.

  19. Alexander Leigh

    South Africa is a fantastic country.
    The teritary education system is excellent.
    If you’re considering moving there, do it, with a higher than average salary (which isn’t hard) you can live like a king!

  20. I know you talk about joint degrees elsewhere on this sight, but how do you view joint programs that offer an MBA with, say, an MPA-ID attached, such as offered by HBS and elsewhere. In the context of emerging markets and someone who may be interested in working in this environment, are these worthwhile?
    The MBA/MPP and MBA/MPA-ID are two such joint degrees and I was hoping you could comment on their worthiness.

    1. Sorry for the glaring typo. Site*

  21. great read, I should try and do one for East Africa (or Kenya)

    1. Sure, we always welcome more guest articles / interviews

    2. I am also interested in this.Could you share any insight on careers in Investment banking industry in Kenya. As one of the leading financial hubs in Africa, which are the top banks (e.g in IBD), recruiting process,pay, growth & exit opportunities?

      1. Commercial Bank of Africa recruit in Kenya. JP Morgan set up an office their last year, and on the “buyside” Private Equity firm/Leveraged Buyout firm Carlyle Group are setting up an office there soon after raising a above target 650 million dollar Sub Saharan Africa fund.

    3. Commercial Bank of Africa recruit in Kenya. JP Morgan set up an office their last year, and on the “buyside” Private Equity firm/Leveraged Buyout firm Carlyle Group are setting up an office there soon after raising a above target 650 million dollar Sub Saharan Africa fund.

  22. i know the bank forbids it but is it normal for SAs/analysts to take their presentation / valuation analyses back home (obviously not showing it to anymore ever) to study up in case they need to know their deal information down the road for interviews, full time recruiting, PE / etc.?

    1. Technically you’re not supposed to but there’s no way to tell in a lot of cases, especially at smaller firms… just be discreet

  23. On my resume I wrote “Evaluated buyer/acquisition targets for strategic fit, etc.” based on making profiles on them with descriptions of what they do / revenue /etc. Is this an exaggeration or legit?

  24. brian, if i work as a financial analyst for non-financial companies (like apple, walmart, chevron, etc), will i placed under same category with people from gs, ms, jefferies when applying for mba?

    i see many bankers moving to corporate side after banking and not sure if its b/c they are burned out, they planned it that way.

    with banking season in place, not sure if i want to build my resume or my life…


    1. No, bankers are viewed differently from non-bankers – not a huge difference but you won’t be in the same category.

      1. i know he lumped in jefferies with GS/MS — how big is the difference between them for MBA?

        1. There is a difference but lots of people at business school come from non-banking backgrounds so it’s not like the admissions people are sitting around ranking banks all day to figure out who should get in

  25. Hi Brian,

    Quick question. Will it be easier to get into PE from a PE fund of funds group (think BAAM/GSAM etc) or from a bulge bracket I-bank? Reasons?


    1. Bulge bracket because PE firms recruit 99% from bulge brackets

  26. @PayLifeStyle

    You dont happen to know how best to go about getting an internship at a bank if you are only in your 2nd year of university in South-Africa?

    Banks only seem to recruit 3rd years and honours students, and i would really like to get started soon.

    1. Not sure on that one, but just like the US you can probably cold-call local banks and ask about informal internships

  27. It’s funny how he mentions pay relative to lifestyle. Yes you may make 50/50=100K in US/UK etc. but you lose almost 50% in taxes, allowances etc. Alongside that add some expensive housing/clubbing/food and you’re broke (like Brian explained earlier).

    SA on the contrary is quite cheap, even if you only make 50K all-in (salary+bonus) that’s still extraordinary, because you will keep 90%+ after taxes.

    Mind you, a dinner at La Colombe in Cape Town, 12th on the List of worlds best restaurants will set you back only $50 including tip (this opposed to $300-350 for an equal quality restaurant in US/EU). You can even have 3 full-time (maid, cook, gardener or w/e) staff members for little more then $400 per month.

    1. minimum wage here is about R1000/month.

      exhange rate is R7/dollar

      1000/7. about $140/month.

      1. PayLifeStyle

        Agreed. Dinners are much cheaper than US, although I pay more than $50, due to the great wines here. Tax rate is 40% at the top end, which you will reach if you are in finance. Having your own staff is very popular in SA, I think there are more than a million employed in private households…

        1. With regards to pay, do CA’s or investment bankers get paid more in South-Africa?

          1. PayLifeStyle

            i-bankers by far. Unless you are comparing a partner at a successful audit firm earning profit-shares vs. a junior banker.

    2. Sounds good – maybe I should move there…

      1. Interpol stats will fix that.

  28. I currently work in the public finance department of a regional firm (2 yrs experience). I am well aware that public finance falls outside of what most people consider traditional investment banking. I also realize that I have a relatively limited set of exit options relative to IBD analysts, but I do think I have a good shot at a DCM position. Any advice on making this transition? Would it be misleading to put something like Investment Banking Analyst: Public Finance Group on my resume?

    Big fan of your site, wish I would have found it a few years ago!

    1. You could list that on your resume… after that it’s really down to networking, headhunters, and spinning your experience into sounding modeling/deal-intensive.

  29. You might have covered this elsewhere but I’m just wondering how one gets an internship/job in an emerging market if they went to university here and doesn’t have any personal ties in the country?

    Do most people work at a Big 4 or an investment bank here for a couple of years and use their connections? Is it even possible to get a job in SA/HK/ME from undergrad if you aren’t from that region by networking or whatnot?


    1. It’s very difficult unless you have connections or went to school in the region, so you are basically correct. Flying in without a plan and looking for a job via cold-calling is not recommended.

      Most people have some type of background, have studied abroad or gone to school there, have family there, and so on.

      1. In South America

        Coming from a developed economy to work in a developing economy in South America I have a further biased view on this.

        Many people forget to think of this kind of move from the employers point of view. They think “Great, I’ll get all this experience coming straight out of University etc”.

        The potential employer is thinking “He has no connections, no experience of working in that culture, doesn’t know the language

      2. In South America

        Coming from a developed economy to work in a developing economy in South America I have a further biased view on this.

        Many people forget to think of this kind of move from the employers point of view. They think “Great, I’ll get all this experience coming straight out of University etc”.

        The potential employer is thinking “He has no connections, no experience of working in that culture, doesn’t know the language, will expect a salary above what the locals will take and I won’t get any extra benefit”.

        I work with a couple of Private EQuity firms over here and they wouldn-t even dream of hiring a Undergrad from another country…

        From what I gather M&I did make this type of move a reality, but realism has to set in.

        1. Yup exactly. I have worked in other countries but for most people it’s a waste of time to consider unless they have some type of complementary background

          1. In South America

            I would always, get your experience in your home country first, then using your contacts/experience, leverage for a transfer abroad…

  30. Great article, really worth the wait.

    My guess is that the interviewee probably went to the same university as i do now, and he probably works in one of the banks in the area.

    Would love it if i were able to ask him a few questions myself, but we all know thats not possible. More specifically, how to get an internship in your second year at university? Over here they only look for 3rd year graduates, and honours students.

    Anyway, great article.


    1. I’ll see what he can do – honestly I’m already asking a lot of interviewees by getting these contributions so I don’t like to push it. For internships I don’t think it’s much different from any other region.

  31. Great article!

    I have been trying to find more info on emerging markets (I know which countries this includes but no resource I can find goes any further from there). Can you release an article in the future about what the emerging markets are, what’s all the hype about/why they are so important, and most importantly – how it affects IB (in particular IBD/M&A activity). If you are aware of something please can you post a link here? I have been through several links on your website but a lot of the articles are about counties not within the emerging markets but I couldn’t find one actually describing emerging markets.

    Thanks in advance! :)

    1. Most of the hype is relatively baseless and consists of people looking at GDP growth rates and saying “OMG THAT IS AMAZING THEY ARE GROWING AT EIGHT PERCENT!” without having a clue what living or doing business there is really like.

      More activity will shift to emerging markets over time, but for most people in developed countries moving to one of these places isn’t a realistic option (with a few exceptions).

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