by Luis Miguel Ochoa Comments (82)

Financial Institutions Groups (FIG) 101: Got Book Value?

Financial Institutions Groups (FIG)
If you want to be a bit different from all the other bankers out there, financial institutions groups (FIG) coverage just might be for you:

  • Valuation is completely different – in some sectors.
  • You need to understand the finer points of accounting and spot small details.
  • No one outside the group understands what’s going on.
  • And hey, you might even learn how to cause a financial crisis or two.

As an added bonus, you’ll be busy regardless of whether we’re in a recession (banks consolidate to cut costs) or an expansion (banks consolidate to expand and new banks go public).

You just need to wrap your head around all the tricky concepts first and crack the financial institutions groups (FIG) success code.

Read on for all of that and more – including how you can optimize your chances of getting placed in the group, the most common deal types, how valuation differs, and whether or not you can ever get non-FIG exit opportunities.

Breaking Into Financial Institutions Groups (FIG)

Q: Let’s start from the beginning: how did you find your current role in your group?

A: I went to a top four school and did my investment banking networking through the alumni who were active in campus recruiting. They were very helpful in my process.

I was originally intrigued by my firm’s restructuring team, but through the selection process was placed into the financial institutions group (FIG).

It has been a great experience so far, and being in my group has really opened my eyes in terms of valuing companies and being a part of an active team.

In any phase of the economic cycle, you want to be in a group that is active with deal flow. I lucked out and was placed in a group that always seems to be busy.

Q: How does that matching process work? Is it based on sell days or just your preferences?

A: You hear presentations about the different groups and afterward you attend a short mixer of some sort.

You’ll need to make quality connections so that your favorite group members can vouch for you and make your case.

If you have too many connections but not enough depth, you can easily get placed into a group you didn’t even list as one of your choices.

It’s not necessarily a bad thing, but it will make your career path more non-linear, especially if you have one mapped out already.

It’s a mutual fit – groups that have a greater need will have more spots open.

Q: Okay, but what about if I’m not an entry-level hire?

If I’m a lateral hire, what could I do to increase my chances of being placed in the financial institutions group (FIG)?

A: One of my favorite movie scenes is this one right here. You cannot arrive at the table with a “clean slate” when you go in for a FIG interview.

My Managing Director once said, “It’s much easier to write a term paper with stuff written on the document already than it is to write from a blank sheet of paper.”

So you need to read up on financial institutions groups (FIG) analysis, including how valuation differs, how the industry is divided, and you need to be able to speak intelligently about industry trends.

For an academic approach, take a look at NYU Professor Aswath Damodaran’s work and some of the papers he makes available on valuing financial services firms.  You may also be interested in these cases on bank valuation issues and capital structure.

Other resources I recommend for more of an applied / hands-on approach:

Go through those and absorb everything you can, and make sure you can talk about a few recent FIG deals, what motivated them, and what you think about the valuation and deal terms. Maybe even produce a one-page summary…

They don’t expect you to know everything walking into the interview, but they do expect you to be enthusiastic and a fast learner.

Both elements come across in how you talk, how you interact with your interviewers, and through the quality of your work (or responses).

Financial Institutions Groups (FIG): Industry Overview

Q: Wow, thanks for all of these tips. These are very helpful for anyone looking to join the FIG scene.

So what exactly do you cover? How is the industry divided, and are certain banks stronger in certain areas?

A: Historically, FIG has been the biggest revenue generator for many investment banks – so they devote a lot of resources to it.

Here are the main divisions within financial institutions, as well as a few middle-market and boutique banks that specialize in some of the areas:

  • Banks, Thrifts, and Depositories: Sandler O’Neil, Stifel Nicolaus Weisel (former Keefe Bruyette Woods), and Jefferies (former Barclays team)
  • Specialty Finance
  • Insurance: Macquarie (formerly: Fox Pitt Kelton)
  • Broker-Dealers
  • Investment / Asset Management
  • Financial Technology: FT Partners, Freeman + Co.

Of these areas, Banks, Thrifts and Depositories, Specialty Finance, and Insurance are by far the most different from “normal companies” because metrics like EBITDA and Enterprise Value simply don’t apply.

The other three sectors are not nearly as different, although there are some industry-specific metrics.

Here’s a brief overview of the business models in each of these sub-industries:

  • Banks, Thrifts, and Depositories: You deposit money, they pay you a certain interest rate, and then they issue loans to businesses and other individuals at a higher interest rate.
  • Specialty Finance: These are companies that provide “alternative lending” models – credit card companies, mortgage banks, commercial finance, leasing, mortgage REITs, asset-backed lending, and so on.
  • Insurance: You pay a premium to cover yourself or your property in case of emergency, and they pay you when emergency strikes; when it doesn’t (or until it does…), they invest the money to earn additional profits.
  • Broker-Dealers: They earn commissions on each trade or each deal (investment banks, stock exchanges, and so on).
  • Investment / Asset Management: They raise money from investors, invest it, and earn a return on their investment. Or, they may simply manage client funds and charge a percentage fee for that.
  • Financial Technology: Payment and transaction processing, card networks, financial software, and so on. The business models vary: commissions, recurring subscription fees, and more.

Q: OK, so those are a lot of areas and they all sound pretty different in terms of business models.

How does staffing work in financial institutions groups (FIG)?

A: Depending on the firm, you can either be a generalist and receive assignments from any of the verticals, or be a specialist and just cover one area very well.

You just need to be flexible in your expectations – just because you like a certain sector doesn’t mean it’ll be incredibly busy.

As I said above, banks, insurance, and specialty finance are the most different sectors in FIG, so you’re more likely to be a specialist if you happen to work in one of those.

Financial Institutions Groups (FIG) Valuation: Book Value, Dividends, and… Regression Analysis?

Q: Right, so the experience is dependent on the sector but you’re more likely to be a specialist in certain areas than in others.

What about valuation? A lot of readers are curious about this one because it’s so dramatically different for FIG.

A: Most practitioners who cover Financial Institutions argue that valuation is very different from all the other sectors’ valuations (ex: consumer retail, industrials, etc.).

The reality is that the valuations are different in calculation, but not in approach.

You still use both intrinsic valuation and relative valuation, including methodologies such as trading comparables and precedent transactions.

If you take a look at the Fairness Opinion for BlackRock / Barclays Global Investors (see page 20), you can see how the measures are evaluated in practice.

That is an example of an asset management valuation, and you can see the metrics and multiples they use: P / E, EV / EBITDA, and EV / AUM (Assets Under Management).

It’s not dramatically different from normal companies because asset management firms don’t make money with the interest rate spread as banks and specialty finance firms do.

As for the actual methodologies used, let’s break them down by sub-sector:

  • Discounted Cash Flow: Most applicable for broker-dealers, investment / asset management, and fin-tech. The same as your standard DCF based on Unlevered Free Cash Flow.
  • Dividend Discount Model: FCF is meaningless for banks, specialty finance, and insurance firms, so you use dividends as a proxy for their free cash flow instead.
  • Multiples – P/E: You could use this for almost anything.
  • Multiples – P /BV and P / TBV: More applicable for banks, insurance, and specialty finance since their market values should be close to their book values. Sometimes Tangible Book Value is used, so you subtract Goodwill & Other Intangibles (which can artificially inflate Book Value).
  • Multiples – EV/EBITDA: Applies more to asset management, broker-dealers, and fin-tech; EBITDA is not used for the other sub-industries.
  • Multiples – EV / AUM: An important metric for asset management.
  • Multiples – Price Per Share / Embedded Value Per Share: This one’s specific to life insurance; embedded value is an intrinsic value methodology there.
  • Multiples – (Debt + Preferred Equity) /  Total Capital: Specific to insurance
  • Regression Analysis (Net Flows): Asset Management Inflows that are directed to a firm’s AUM divided by the firm’s Assets Under Management, graphed against P/E. This metric tells you how price is related to the firm’s ability to attract new money.
  • Regression Analysis (Price / Book Value vs Return on Average Equity): Here you are keeping an eye for the premium (discount) of companies’ datapoints to the curve itself.
  • Pro Forma Analysis (Merger Consequences Analysis or Accretion-Dilution): Pretty standard, but it can get complicated with banks (deposit divestitures, regulatory capital adjustments, and so on).

See page 18 here if you’re interested in an investment firm case study.

For a reinsurance client presentation on valuation, try:

Fairfax Financial / Odyssey Re:

On the bank/thrift side of things, geographic presence is a big motivation to engage in M&A, as illustrated here.

Taking a look at a transaction between stock exchanges, you can see that the valuation measures are very similar to the standard set.

In terms of other numbers, metrics such as Return on Equity (ROE) and Return on Assets (ROA) are quite important for both commercial banks and insurance firms because you only use Equity Value with them, and Net Income is crucial since it includes their full Net Interest Income.

To learn more about these metrics, please see our tutorial on ROIC vs ROE and ROE vs ROA.

Q: That all seems pretty straightforward except for the regression analysis part – I didn’t think we’d see that used much outside of research / econometrics.

Anything else we should know about valuation in financial institutions groups (FIG)?

A: Another big aspect here is working with and analyzing regulatory capital.

All banks and insurance firms must keep a certain amount of “capital” (basically, shareholders’ equity, adjusted for a few other items) on their balance sheets at all times.

That plays into the valuation because, for example, in a dividend discount model you can’t just blindly assume a 10% or 20% growth rate.

You have to check to make sure that the bank has the minimum amount of regulatory capital required, and then tie all growth and dividend issuance assumptions to that ratio.

So if you’re assuming that they issue a certain percentage of net income as dividends each year, their capital levels must remain above the minimum percentages even after they issue those dividends.

Bonus: Check out this comprehensive tutorial on Bank & Insurance Modeling to learn even more.

Brokers & Dealing: Deals and Pitch Books in Financial Institutions Groups (FIG)

Q: I see, so it sounds like a tweak to the traditional DCF where you can just make the assumptions you want to make, within reason.

What types of deals are most common in your group?

A: Generally the split is pretty even among equity, debt, and advisory assignments. If the market is not doing so well, expect regional depositories to be acquired by larger players.

When times are good, expect a higher proportion of equity deals.

It’s consistent with corporate finance theory – if a firm issues equity, it’s a sign of good times within the issuer.

If a firm issues debt, it means that they need the funds for something more specific than general corporate funding.

Q: That’s interesting to see a more even split compared to other sectors.

What do the industry pages look like in pitch books?

A: Your pages differ depending on the sector you’re covering.

The financial sector is greatly affected by policy updates and regulations, so you might even be staffed on government presentations.

A set of pages might reference major developments and how these developments translate into challenges or opportunities.

Here’s what you might expect to see discussed in the different sub-sectors (just the ones I’m familiar with):

Banks, Thrifts, and Depositories:  Benchmarking pages include a segment on how well-capitalized depositories are. For regional banks, you’re likely to see something on the geographic concentration of branches.

In Manhattan, there’s always a fight between Bank of America and Chase over the number of physical branches and that’s the type of information you might see.

Investment Management: Trends on where money is going will be important to mention (types of investments and the level of overall net new money). The retention of clients through strong customer service and a track record for solid returns is crucial.

Insurance: The main areas concern life, auto, and property insurance. Factors that affect an insurance company include consumer confidence, employment levels, and interest rates.

For more specific forms of insurance, you might even see something on changes and trends in social attitudes (e.g. peoples’ views on work ethic and stability for disability insurance).

Exchanges: Believe it or not, exchanges do face competition. How other firms are able to out-innovate (process, price, etc.) the economies of scale poses a risk to exchanges. Some banks actually internalize trades and take away this trade volume from exchanges.

Financial Institutions Groups (FIG) Exit Opportunities: Do They Exist?

Q: Interesting to note all that. It sounds like you learn about the broader trends in the economy, but do you also get broader exit opportunities?

Some people say FIG is an incredibly specialized group and that you can’t do anything outside of FIG afterward – true or false?

A: It is, and it isn’t. Some people say being in FIG is a handicap for private equity recruiting, which is true to some extent.

If you’re in the financial institutions groups (FIG), however, you have a much better story in terms of getting into strategy / corporate development roles at financial institutions.

You are definitely more specialized, and that can limit PE opportunities – but you’re also in a much better position for funds that invest in financial institutions.

Most normal PE firms won’t even touch financial institutions because they don’t understand them – but there are a few specialized PE firms that focus on FIG (e.g., JC Flowers) and they’re not likely to recruit someone without FIG experience.

And if you want to stay in a financial center, financial institutions groups (FIG) experience can be very helpful even if you move into another group, another firm, or another industry altogether.

So much business in places like London and New York depends on financial firms that understanding them in-depth and having contacts there can make a big difference in almost any field – if you start your own company one day in one of those cities, guess who your main customers might be?

Q: How can readers tell if FIG is right for them?

A: If you like reading up on the sector and you enjoy following financials you’re good to go.

The quality of your work is dictated by how badly you want to perform, and how interested you are in your work.

Some of the top leadership on Wall Street today actually had some background in the sector – for example, Morgan Stanley CFO Ruth Porat was originally a tech banker who then worked in financial sponsors / financial institutions.

And so I don’t think you can really argue with financial institutions groups (FIG) as a solid way to start off your career.

Q: Awesome, thanks for your time.

A: Sure thing – enjoyed speaking with you!

M&I - Luis

About the Author

Luis Miguel Ochoa has facilitated a variety of strategic initiatives from corporate acquisitions to new market development. He earned his B.A. in economics from Stanford University where he was a member of the varsity fencing team.

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  1. Any good resource for Asset Management Industry outlook?

    1. I don’t have anything, sorry. Maybe look at the reports on AM issued by some of the Big 4 firms.

  2. Hi Brian, how well does GS FIG places into top HF/PE/VC?

    1. It’s GS, so it always places well, but the issue, again, is that there aren’t that many financial services-focused HF/PE firms. However, I believe that GS FIG is less of a “pigeonhole” than other banks, so you could also move into non-fin-services buy-side firms.

  3. Hi Brian,

    I have accepted an offer from an M&A boutique that solely focus on Fintech.

    3 questions:
    – Is Fintech considered a part of FIG or a part of technology?
    – Can I after 1-2 years transition to a TMT group in another investment bank?
    – Can I stay 1-2 years at this Fintech M&A boutique and then move to like Moelis or Evercore or something like that? Or will the fact that I specialized in Fintech kill my chances…?

    Thanks a lot.

    1. It varies based on the bank, but if it’s an M&A boutique that only does fintech, it should be more on the technology side. I would certainly try to spin it that way in interviews.

      Yes, if you spin the experience the right way, you can move to a TMT group later on.

      Moving to an elite boutique is possible but still challenging just because of the number of people applying and relatively few spots available. The issue isn’t really fintech, the issue (beyond the odds) is that you need not only good deal experience and technical knowledge but also good brand names to have a high chance in the process. So… it’s possible, but I almost think it’s easier to move to a bulge bracket due to higher turnover, more spots, etc.

  4. what Are some of the funds that focus in FIG?

    1. Lightyear Capital
      JC Flowers
      Stone Point Capital

      Lovell Minnick
      W.L. Ross

      Warburg Pincus
      Oak Hill Capital

      Some do more than FIG (obviously Oaktree, Warburg, etc., are huge), but all have some type of team dedicated to FIG.

      1. Avatar
        Alex Diaz

        Hi, Do you know of any funds that invest in FIG in Latam region?

        1. Not offhand, no, and there aren’t that many FIG-specific funds to begin with… so there might not be much out there.

      2. Genstar and THL seem like they like the asset management/FIG world as well, especially genstar

  5. Hi im a newbie to IB. Have been a corporate banking RM for 3 years and was previously from engineering. So, yeah, newbie. I was just offered a FIG associate role but am absolutely freaking out now after reading all about the no-exit-opps hysteria. So should I accept the offer? The thing is, 1) I have been out of my last role for almost half a year due to family reason and i have not enough resources/IB contacts to make a fully informed decision about this offer. Dont want to make a knee jerk decision to accept it just out of desperation but also dont want to make a potentially career-altering decision without knowing if il even like FIG. 2) I want to apply for a Masters/MBA but I know my half year absence is putting a dent on my application therefore if I accept this role & just work for 1-1.5 year, I wonder if that’s better for my MBA app and would that then alleviate the whole “being pigeonholed” risk post MBA?? So I guess my main point is, to accept or not accept, which way is best for my (preferably top BSchool) MBA acceptance goal? Thank you so much for any advice. Sorry for being wordy.

    1. If you haven’t been working for half a year, I would recommend just accepting this role. If you don’t like it, you can leave in another 1-2 years without limiting your exit opportunities too much.

      Yes, FIG exit opportunities are more limited, but that really means “It’s harder to get into traditional private equity coming from FIG because headhunters don’t know anything.” You can definitely get into a top MBA program.

  6. What are the best banks for FIG in general?

  7. Hi Brian,
    Thank you for the very informative article! I always wanted to do IB, but so far I only pulled off internships in Big 4 transaction services, smaller boutiques and consulting. Coming from a semi-target university, I didn’t get the chance to intern at a BB yet. Therefore, I decided to go for a finance master at Imperial College and got in, starting this September.
    A few weeks ago, a friend who works for a BB in London offered me to join a quick, informal interview process for a full time position in a FIG team. I went for the opportunity and won the offer (starting in September as well).
    I am struggling now though to make a decision after reading more about FIG, as I am afraid that this is a dead end (would have preferred a energy or industrials team). Also because of limited exit opportunities to PE I am not sure whether to take the offer or not. Thus, I thought about the following: Accepting the offer and work there for a year while delaying my master for a year and then quitting the job next summer and going for the master. With the BB name on my CV I would then try to apply during my master to other teams (such as energy) in other BBs.
    1. Do you think that is a feasible idea, or will I be always stamped as a FIG candidate for further applications (even if it only was one year of FIG experience) without the chance to move to other teams?
    2. If you think it is feasible, would I apply then during my master to entry level or junior analyst positions having then already one year of IB experience on my CV?
    3. If you don’t believe that is a good plan, would you decline the offer and go for the master, hoping to pull off another full time offer through normal recruiting, or would you rather go for the FIG position, decline the master offer and maybe try to change teams within the bank?
    I apologize for the long comment, but I hope you can help me. Thank you so much in advance.
    Best regards,

    1. I don’t think that’s a great idea because it makes no sense to accept an IB offer and then return to a Master’s program. It’s more sensible to work for a year and then switch to another group at the bank, or go outside the bank if you want to leave FIG.

  8. Thanks for the article. I have a question about exit opportunities. I am currently a FIG analyst at a BB. I would like to exit both IB and the FIG industry as fast a possible. I would like to move to corporate strategy positions (hopefully in the entertainment or tech industries). Have you heard of any FIG analysts doing this, or would I need to pursue an MBA or consulting job before I did this? Thanks!

    1. It is tough because headhunters tend to lock you into the FIG box once you enter it. Your best bet might be to move to a finance-related company in strategy first and then move to entertainment or tech from there.

  9. Hi,

    I have an interview coming up with a FIG group, but they mostly focus on insurance companies. What are the differences with them valuation wise? Do you have any resources I can look at to understand the industry as a whole (not necessarily from a technical aspect)?

  10. Hello,

    Can you explain to me why a bank’s / insurance companies’ market value is close to it’s book value?


    1. Because the amount of money a bank or insurance firm can earn is linked nearly 100% to its Balance Sheet – how much it’s earning on its Assets, and how much it’s spending on its funding sources (Liabilities & Equity).

      With other companies, this link is much less direct if it even exists at all. For example, a services business makes money based on how many employees it has and the rates it charges… and none of those employees are on its Balance Sheet. So its market value will be much different from its book value.

      1. Great, thanks Brian

  11. I have worked in a reinsurance broking firm for two year. I’m considerring getting a MBA from a top B-school. Can my insurance industry experience help me to break into IB’s FIG group after graduation?

    1. Avatar
      M&I - Nicole

      Yes it can potentially help, though best if you have some sort of valuation experience

  12. When in terms of timing and level/title does one go from FIG to a corporate development or specialized PE role? I suppose for corporate development one would need to be more experiences, so after being a Director? VP? And specialized PE – after being an associate in FIG? Thanks in advance! Can you go to work at a central bank after FIG banking – if so, in what function and level?!
    Thank you in advance!

  13. Thanks I appreciate the help.

  14. I am trying to network with a boutique doing only FIG. I like everything about the firm so far (deal flow, culture, etc), but right now my answer on why I want to do FIG specifically is weak. Can I say I really want to learn more about the specific valuation techniques used in the retail bank industry? I have nothing in my background that necessarily supports that claim (the little finance experience I had did not involve any FIG deals)


    1. Avatar
      M&I - Nicole

      Have you been following banks? Are you familiar with bank modeling? I think you may want to choose 1-2 FI you’ve been following, and be able to talk about it. Talk about what fascinates you re. analyzing FI companies, and how its different from other industries.

  15. Are equity reits figs?

  16. Avatar

    I received a 3rd year lateral offer in FIG from a Leveraged Finance group. FIG at my current BB is very modeling and M&A intensive, whereas the Lev Fin team was a Capital Markets group. Would I have a shot at megafund and top middle-market PE exits coming from two years of Lev Fin and one in FIG? Or would I be limited in my exit opportunities to the buyside?


    1. Avatar
      M&I - Nicole

      FIG can be pretty specialized. I would suggest focusing on your levfin experience to ensure you aren’t “pigeon-holed”

      1. Avatar

        Apologies, can you elaborate a little more on how I can focus on my Lev Fin experience?

        1. Avatar
          M&I - Nicole

          Focus on your levfin experience interviews and the deals you’ve been involved in there.

  17. Avatar
    Ankit Patil

    Great Article. Thanks for getting into details.

    Its really helpful to me as have an opportunity t talk with MD in FIG in bulge bracket firm. And I am really worried that i will blow this up.

    Please can anyone suggest to get best out of this phone call. Its just for 20 mins.

    1. Avatar
      M&I - Nicole

      Please refer to and scroll down to “Questions to Ask and Questions Not to Ask”

  18. Are there good resources specifically for Canadian FIG activity? American Banker I think is much more suited for the US.

  19. Thanks for this, it’s a great article. Really helpful. I have an interview coming up with a FIG team though my question is regarding one of the generic questions. I graduated from a not known university for undergrad last year (Economics) but managed to get experience at an M&A boutique during my time there. Then I got on to a Masters programme at one of the “top” schools but in a not related subject (Political Economy). It’s most likely they will ask why I picked this course. My honest reason is that I was interested in policy and economic applications & brand school. However, I am sure I will come across as someone not dedicated to banking. Is there any way I could put a positive spin on my course choice?

    1. Avatar
      M&I - Nicole

      Not necessarily. Just say that you were interested in learning more about world policy and economics and you’ve always wanted to get a masters. You thought that was the right time to get your masters (right after graduation). Now that you’ve achieved your goal, you want to go back to banking given your previous experience, your passionate about finance, investing, and learning how transactions work, and that you want to do work that makes a broader impact and apply your knowledge from your masters to the corporate world. And then why FIG (perhaps you are very interested in analyzing FIs, or you feel that you can make a bigger impact by advising them – tie that with your passion in world political economy)

  20. Brian & team,

    This was a great post and very informative but I have a question titled towards exiting FIG.
    To give a background: I am currently an analyst in FIG at a BB. I dont want to sound disrespectful, but I absolutely hate FIG. I find it very boring, and am trying to do an internal lateral to a different coverage team (Consumer/Industrials/Healthcare/Energy. In a nutshell, I just dont want to be in FIG so I am trying for anything that can get me out of here.

    I was hoping to seek views on what could potentially be classified as “understandable” reasons for leaving FIG? For instance at my BB, its not considered an “ok” thing to talk about exit options hence I cant bring up the reason that I would like to leave FIG because of limited exit opps. Furthermore,I think saying that FIG is too technical for me – which is actually the case too – could potentially be disrespectful to other teams that I talk with as it would give the idea that I find their work too simplistic or less intellectually challenging.

    I am really at cross roads over here. Can you please guide me on what reasons can one potentially use to exit FIG? I am talking with some other coverage teams next weeks, and want to get my story straight. My reasons for leaving FIG are pretty much that I am not interested in this sector, and I dont have the desire to learn much about it as I find it boring. I would appreciate some guidance on a “further refinement” of words or just even “better reasons”. Thanks again!!

    1. Avatar
      M&I - Nicole

      Depending on which group you’re interviewing for, you can just say something along the lines of “While I have learned a lot from my experience at FIG, I realized that I have become more interested in [XX] sector given [Name the reasons why you’re interested in that sector]. Then talk about how you think your skills/experience can translate to that group.”

      1. Thanks Nicole, but like I mentioned in my original post, I am just wanting to get out of FIG so I am looking at every other industry team (Cons/ Healthcare / TMT / Indutrials / Energy & Power). I think if I started coming up with specific reasons to join non-FIG industry teams, I would lose my authenticity.

        Do you recommend some “generic reason” to exit FIG instead of me coming up with [x] reasons to join Consumer, [y] reasons to join TMT, [z] reasons to join Industrials etc. Dont you think that would be a much better approach? I would have happily used the “pigeonhole” factor or the “limited exit opps” if I knew the seniors at my bank would have been ok with it.

        Thank you again for your help.

        1. Avatar
          M&I - Nicole

          You can just say you enjoyed your time at FIG but you’ve realized that FIG isn’t what you want to be pursuing in the long term and you would like to join another industry group such as XX (In your interview) because [XYZ] It is more convincing if you have a story explaining why you want to join that particular group or people may question your intention of joining their group and wonder if you’d stay in the long run

  21. Hi Brian, thanks for the great article here. It’s very informative and helpful!
    You mentioned that there are some FIG-focused buy-side firms like JC Flowers, wonder what other names you know that also have dedicated FIG coverage?

    Thank you so much!


    1. Avatar
      M&I - Nicole

      I don’t know of others though I’ll let you know if I come across other names.

  22. Thanks for a great article.

    I’m assuming most FIGs are based in New York, but are there any that are housed elsewhere?

    1. Avatar
      M&I - Nicole

      In US, perhaps SF and Texas? Internationally, HK & London

  23. Another great interview; very informative as always.

    I was wondering what backgrounds are common amongst FIG bankers who do not break in to banking right out of undergrad? I’ve met with many bankers working in tech, retail, and healthcare coverage groups, and it seems that many of the associates have worked in the industry they are covering firsthand at some point, either right before banking or before B-school. Would you say it is more common/plausible for FIG bankers to come from corporate finance or corporate development backgrounds?

    Also, quick resume question- is it appropriate to list specific modeling courses that I have completed, such as your BIWS course or Training the Street courses for example, on my resume?

    1. Avatar
      Class of 2012

      At my firm we have one Director in FIG who previously worked at an Asset Management company in Portfolio Management. He switched careers after going to grad school.

    2. Avatar
      M&I - Nicole

      Its hard to say because some break in right after college, some break in having corp fin backgrounds/backgrounds with other FI.


  24. Avatar
    Class of 2012

    Does anybody know of an equivalent to the above mentioned “Financial Institutions, Markets, and Money” for the European Financial Institutions Market? Business Models for large universal banks (Barclays/JPM, Deutsche/BAC) might not be materially different, however dealings with institutions like the ECB and national central banks and regulatory issues might differ. Thanks!

  25. Amazing coverage on FIG.
    I am a first year in a BB FIG. I learned a lot from this interview and would recommend the resources mentioned by Luis as well.
    Kudos to both Luis and Brian.

    1. Thanks! Glad to hear it, and let us know if you have any additional resources that would be helpful.

  26. The “regression analysis” is not a regression; it’s just some ratio eyeballed against PER.

  27. Hey, nice article! I was wondering if someone who’s working on a bank-merger deal might have to work on more complicated models such as RAROC or risk-management related?

    1. Merger models can be more complicated (deposit divestitures etc.) but generally you don’t see RAROC and so on. From what I’ve seen and discussions with friends in FIG, anyway.

  28. Incredible article Bri. Perfection as usual. Thanks

    1. Thanks! Luis deserves the credit though – he conducted the interview and wrote it, I just edit and respond to comments. :)

      1. Luis is the man. I actually met him in person and he really knows what he is talking about.

        1. Thanks! Glad to hear it. We only hire the best. :)

  29. I tried to call this MD earlier this afternoon but didn’t get through. I assumed he’s busy so just left a voicemail message and asked him to call me back. If he doesn’t give me a call back, should I call him later today or early tomorrow morning?

    1. I would not leave voicemail until you’ve tried dozens of times and couldn’t get through. In this case, I would just try back early morning or late at night to avoid gatekeepers until you get in touch and try each day.

  30. Nice but I’m more interested in what happens behind closed doors at the FDIC between fridays & sundays ie a bank is declared in receivership & the next monday it opens shops as subsidiary of a big one…does anyone have any idea where and how to break in? It’ll be more fun there…

    1. Hah, good one. We are featuring an upcoming interview series on finance jobs in the government so that may be relevant for you.

  31. Another Question regarding networking – I talked to a guy over the phone a couple of days ago, but I want to meet with him in person. Also because I’m in the midst of recruiting so I don’t want to wait for a few weeks before reaching out to him again. When should I email and How best can I word it? Thanks.

    1. Just say that you’re actually about to leave town or travel or something and you’d like to meet him in the next few days if possible – you know he’s busy, but you really value his insights and would appreciate being able to do that before you have to take off.

    2. Avatar
      M&I - Nicole

      Just ask him if he’s available for a coffee/drink on email. Offer to drop by a coffee shop/pub close to his offer

  32. I just wanted to ask a question regarding networking.

    If I have already met with a person from the same group, and am now trying to reach out to a more senior guy in that group, should I mention that I have talked to the other person in the email?

    My thinking: if I mentioned the other guy, he might just say oh well then just talk to him instead and don’t waste my time. But if don’t mention it, he might find out anyway, and the other guy I talked to might get pissed off.

    Any advice is welcome. Thanks.

    1. Avatar
      M&I - Nicole

      If you got along fine with the other person and he/she liked you and is ok with you contacting his/her senior, do so.

      I would try to network with other people in the same firm and see how the other person gets along with that senior guy. If they get along fine, I would not bother contacting the senior person if the other person didn’t like you and/or minds you contacting his/her senior. If the two didn’t get along fine, I’d go ahead and contact the senior guy anyway.

  33. I work in a FIG team in Asia and it seems that the FIG team always has the longest hours in the bank. Same goes for my friends in other banks. Is this the case in the States/UK?

    1. Hard to say – everyone likes to think they have the longest hours. You do work a lot in FIG but the hours really depend on your group, deal flow, and what the economy is doing. I do think that FIG can be more technical than other groups, especially in areas like insurance, so that can make it worse.

  34. Avatar
    Dreama Queen

    Is FIG any good if you hope to be the CEO of a bank one day?

    1. You could argue that it is. In practice, bank CEOs come from all different areas within the firm including S&T, IBD, etc. Knowledge of how financial institution accounting and valuation work is helpful but you don’t necessarily need to work in FIG to pick that up.

  35. Thanks for the great interview. I’m a little doubtful about the optimism presented in this view though. The interviewee noted that there might be exit opps in FIG PE and financial centers (?) if you want to start in your own company. From other opinions I’ve searched online, it seems the general opinion is that FIG is an extremely niche industry and that unless you really love it, you should get out ASAP. Definitely doesn’t sound like the place for college grads to start their careers. Is this true?

    1. I think there’s some truth to that, but the same thing happens with most industry groups – recruiters always try to pigeonhole you into exit opportunities related to that industry. If you do tech you’ll get funneled into tech-related opportunities. Maybe it’s a little easier to switch industries outside of FIG, but you’re still limited to some extent.

  36. Great Job!! as usual. M&I continues to exceeeeed all my expectations!

  37. thanks for the great interview

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