Introduction
Investment banking is one of the highest-paying financial systems in existence, with salaries of around 79,147$ per year, according to Indeed. It serves a variety of goals and business interests. Imagine you are the owner of a huge business, and you are hoping to make the most money possible from the upcoming project.
Approaching investment banks in terms of revenue, raising capital, and cost could be the best decision for your organization. This article describes the entire process of becoming an investment banker and gives insights into their daily activities.
Investment Banking: A Lucrative Career Choice for Finance Professionals
The investment banking profession is very highly regarded and most lucrative in the financial field. The multibillion-dollar deals run by global firms do not exempt the important valuations that investment bankers do for M&A (mergers and acquisitions), IPOs, private equity, and corporate finance.
- High Salary Potential: Junior analysts tend to draw an annual salary exceeding $100K, while senior bankers make several million dollars in bonuses.
- Prestige & Influence: The job involves working with CEOs, hedge funds, and private equity on big financial transactions.
- Fast-Paced & Challenging: One needs to have financial expertise, strategic thinking, and networking to succeed here.
Market insights say that annual growth rates in investment banking are expected to be in between 10% and 15%.
Types of Investment Banks: Bulge Bracket, Elite Boutique, Regional & Middle Market
Banks that provide service of investment solutions are majorly categorized into four types. These four types of investment banks are the following:
| Type | Explanation |
| Bulge Bracket Investment Banks | The best-known investment firms worldwide are covered by the Bulge Bracket Bank, which handles billion-dollar transactions regularly. Compared to other banks, they have the strongest brand value. Eg: Goldman Sachs and JP Morgan |
| Elite Boutique Investment Banks | They frequently pay their staff more than any other bank, including the one with the highest brand value, Bulge Bracket. Eg: Lazar LLC, Moelis & Company, and Evercore Group LLC |
| Regional Boutique Investment Banks | These kinds of banks do not specialize in any particular industry or product. They will work on various projects for various clients from various local industries. Eg: Raymond James and Robert W. Baird |
| Middle Market Investment Banks | It concentrates on providing financial guidance and support to small, growing enterprises. It concentrates on the neighborhood’s middle-class clients and financial sector. Eg: Jefferies and Macquarie |
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Who is an Investment Banker?
Investment bankers are like teachers. They teach the banks how to make money and expand. With a lot of knowledge and experience, they help the banks improve their businesses. In the same way that students are taught by their teachers to grow, investment bankers also assist investment banks to become stronger and more successful. They struggle to get the best possible profits through brilliant ideas and possibilities to expand for the banks, while at the same time looking for new sustainable ways.
What Does an Investment Banker Do?
An investment banker is a person who works on analyzing financial risk and increasing capital. They also work on building relationships with clients and other stakeholders in the market. Investment bankers have to work shifts that are long and stressful, but can have the liberty of having great salaries.
Key Responsibilities of an Investment Banker
- Raising Capital: Assisting companies with stock issuance, bonds, and other financial instruments.
- Mergers & Acquisitions (M&A): Advise the company on buying, selling, or merging with other companies.
- Financial Analysis & Valuation: Evaluate the financial condition of a company to determine its market value.
- Risk Assessment: Identification and mitigation of financial risks arising from transactions.
- Deal Structuring: Facilitating and arranging financial agreements between businesses and investors.
We have collected examples of some responsibilities of an investment banker job:
According to a post on LinkedIn by Goldman Sachs, the responsibilities of a Global Banking & Markets, Public, BCE Expense Management, Associate, Bengaluru, are as below:
Another job description by JP Morgan for the role of International Private Banking Project Management Associate:
Even though there is a difference in both job descriptions, we have made an effort to summarize the important ones for you:
- Building strong relationships with partners and stakeholders
- Perform necessary data analysis
- Handling and taking care of risks and issues
- Providing support for business partners
Why Become an Investment Banker?
One reason people may choose to be an investment banker is that it combines unique challenges, rewards, and prospects, which are extremely attractive to those seeking a career in finance. Here’s why:
Higher Salary Potential: Investment banking is famous for its high-pay packages. Some of the top investment bankers earn much more than the average salary, with annual earnings exceeding one million dollars.
Strategic Decision-Making: The position involves making big decisions that affect the clients’ and the bank’s financial health. It can be both highly satisfying and mentally stimulating.
Worldwide Opportunities: In many cases, you get to travel a lot while working as an investment banker in different countries, consequently exposing you to diverse markets and cultures. This creates a great chance for personal development and professional growth.
A Broad Set of Skills: The job calls for various skills, including financial analysis, negotiations, and customer care. This wide skill set makes this position challenging yet intriguing.
Career Progression: In investment banking, there are clear career paths that offer possibilities for promotion. Managers or business heads are some roles that progress with years and can move into roles, like managing teams or leading significant deals.
Impact on the Economy: Investment bankers help businesses raise funds, advise on mergers and acquisitions, and manage financial risks. Thus, by doing so, they maintain the financial stability among large financial institutions, which indirectly impacts the economy in both a positive and negative manner.
Innovation and Technology: The field constantly changes with new technology as well as products in finance. This presents good opportunities for those who want to be up-to-date with the latest in finance.
In brief, it is a laborious career that requires high intelligence and education in both global industries, financial processes, and strategies. It has immense earning potential; fosters strategic decision-making; offers great global exposure; develops a diversified skills base; and enables individuals to make a difference in the world’s economic development.
The salaries of entry-level analysts as investment bankers in the United States lie between $120,000 and $150,000 per year, while top-level executives can earn $500,000 or more every year.
Internship Opportunities in Investment Banking
Internships in investment banking are crucial for students and recent graduates aiming for full-time jobs in the financial sector. These opportunities allow candidates to explore their desired field while gaining invaluable exposure to the workplace culture. By participating in an investment banking internship, you can acquire relevant work experience and stand out to potential employers. This hands-on experience is an excellent way to kickstart your finance career.
However, securing an internship at an investment bank can be highly competitive, much like obtaining entry-level positions. It’s essential to prepare adequately, highlighting your skills and ambitions. By showcasing your dedication and eagerness to learn, you improve your chances of landing an internship that will pave the way to your dream job in investment banking.
Skills Required to Become an Investment Banker
Investment bankers can’t be the ones who believe in hit-and-trial methods. There is a complete skill set that should be possessed by investment bankers to excel in their growth as well as the profit of their clients. Some of the skills required to become an investment banker include:
Analytical Skills: Ensuring that investment bankers’ judgment is not influenced by any type of false information and that they can provide their clients with accurate recommendations. Therefore, it is mandatory to have strong numerical and analytical skills.
Networking Skills: Interpersonal skills enable bankers to improve their working connections both with clients and within the company. Socialism is surely important in any career.
Financial Skills: According to an article on Indeed, financial skills with strong mathematical, economic, and accounting skills can help investment bankers take care of large-scale financial transactions. Not only this, but knowledge of investment products like stocks, foreign exchange, IPOs, etc., can also give an upper hand.
Knowledge of Securities & M&As: Knowledge of Securities and Mergers & Acquisitions (M&A) is one of the most important skills to become an investment banker, especially if you are working on deal-making, financial advisory, and corporate finance. This can help investment bankers analyze financial securities and help in strategic transactions.
Economics Skills: These skills help in understanding market trends, providing clients with strategies, and helping with better decision-making
Problem-Solving Skills: Investment bankers have to deal with a lot of issues and risks as a part of their job’s volatile economic position across the globe. Thus, making effective and accurate decisions plays a huge role. Every problem has a solution, but choosing the most cost-effective solution is very important.
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Step-by-Step Guide to Becoming an Investment Banker
The blog’s most crucial question is about to be addressed. Although you were eagerly anticipating this section, the topic of investment banks and their bankers was just as crucial. To start with – Investment banks, however, have a long list of requirements when it comes to hiring applicants. How about starting with the most basic necessity that is required to be an investment banker? Below is the step-by-step road map on how to become an investment banker:
Step 1: Choosing the Right Education to Advance Your Career
- Bachelor’s Degree – A degree in finance, economics, business, accounting, or mathematics is preferred.
- Top Universities Matter – Investment banks are more likely to hire candidates hailing from Ivy League or well-renowned universities around the world.
- MBA – An MBA from a good business school like Harvard, Wharton, or London Business School makes it more likely to be chosen.
- Alternative Paths – Being a CFA (Chartered Financial Analyst) or FRM (Financial Risk Manager) can help if one has not opted for an MBA.
Tip: Gain some practical financial knowledge through financial internships as well as networking events in college years.
Step 2: Must-Have Skills to Excel in Investment Banking
To succeed as an investment banker, a blend of technical and soft skills has to be developed.
Technical Skills:
- Financial Modeling & Valuation – Learn the Discounted Cash Flow (DCF) Analysis and Comparable Company Analysis (CCA) along with Precedent Transactions Analysis.
- Excel & PowerPoint Mastery – With investment banking comes the need for advanced Excel proficiency for financial modeling and an appropriate skill level in PowerPoint for presentations.
- Accounting & Financial Analysis – Anyone should be able to analyze statements of balance, profit and loss, and cash flow.
- M&A and IPO Process – Study the process of mergers, acquisitions, and public offerings.
- Market Trends & Economics – Be aware of global financial market developments, economic trends, and investment opportunities.
Soft Skills:
- Communication & Negotiation – Capable of expressing financial information both verbally and in writing with clarity.
- Analytical Thinking – Skilled in interpreting extensive financial information and observing market dynamics.
- Attention to Detail – Minor inaccuracies in monetary reports may result in losses amounting to millions of dollars.
- Resilience & Time Management – It is essential to have excellent patience and time management skills, as investment banking requires extensive work hours and work within very short deadlines.
Tip: Register yourself for an Investment Banking Certification Program such as Intellipaat’s Investment Banking Course to gain firsthand knowledge.
Step 3: Gain Practical Experience Through Internships and Entry-Level Positions
- Internships Carry Weight – Most investment banks recruit full-time analysts from their internship programs.
- Go After Summer Internships – Programs like the Goldman Sachs Summer Analyst Program provide you with on-the-job training.
- Start as a Financial Analyst – Most investment bankers start as an analyst in the corporate finance or asset management divisions.
- Work at Boutique Investment Banks – If you cannot land a position with a large firm, begin at a boutique investment bank or a midsized one and progress from there.
Use your LinkedIn and alumni networks to land a summer job at a top bank.
Step 4: Build a Strong Professional Network for Career Growth
- Participate in Networking Events and Finance Conferences – Events like CFA Institute Conferences and Wall Street Prep Seminars provide good opportunities to network with recruiters.
- Online Participation in Finance Communities – Participate in discussions on investment banking using LinkedIn groups, Reddit forums, and Quora.
- Find a Mentor – Learn from seasoned investment bankers who can help you with your career progression.
Use the cold emails to get in touch with recruiters and industry professionals for information about job opportunities and mentorship.
Step 5: Apply for Investment Banking Jobs and Succeed in Interviews
- Prepare for Technical Interviews – Learn how to create financial models, work with M&A case studies, and conduct market research.
- Prepare Responses to Behavioral Questions – Frequently asked questions are:
“What is your motivation to work as an investment banker?”
“Can you tell me about an instance when you had to work under pressure?”
“Can you explain how you perform a DCF valuation?”
- Use your network to its maximum potential – Using referrals improves your odds of getting employed in elite firms such as JPMorgan, Morgan Stanley, and Goldman Sachs.
For the investment bank interview questions, gain insider access via platforms like Intellipaat.
Investing 5-6 years to seek a particular job? Too much to invest, right? If you experience these kinds of insecurities, you fit into the group of common people. Do not worry about it, it is a profession that guarantees you significant growth, so the risk is worth taking.
How to Transition into Investment Banking from Another Career?
Investment banking is tough to crack, with professionals coming from different backgrounds making a transition into a tough field. But it can well be done, considering the right approach toward it.
Top Career Backgrounds That Transition Successfully into Investment Banking
- Consulting – Several management consultants have made the switch to investment banking owing to their prior experience in corporate strategy and financial modeling.
- Accounting and Auditing – Employees of the Big 4 firms, such as Deloitte and PwC, transition into banking because of their financial knowledge.
- Technology and Data Science – Experts in IT are becoming essential in investment banking due to the rising importance of fintech, artificial intelligence, and blockchain technology.
- Entrepreneurs and Business Owners – Business leaders who have previously dealt with fundraising, financial structuring, and valuations often transition smoothly.
Successfully Transition into Investment Banking: How to Break in?
- Step 1: Enhance your education with a focus on financial modeling, valuation, or M&A analysis. Courses offered at Intellipaat Investment Banking Certification Program gives you a headstart.
- Step 2: Incorporate PowerPoint, market research, Excel, and corporate finance into your skillset.
- Step 3: Get a Charter Financial Analyst (CFA) or MBA degree. The return on investment is worth it.
- Step 4: Leverage events and LinkedIn for getting in touch with recruitment agencies as well as other experts in the field for networking purposes.
- Step 5: Work as an Investment Banking Associate, a Financial Analyst, or as a Junior Corporate Finance Specialist to gain first-hand experience.
Professionals looking to transition should identify transferable skills to emphasize in applications, namely analytical thinking, deal negotiations, and client management.
Investment Banker Salary (India and USA)
As we have already discussed, Investment bankers are one of the highest-paid individuals. Let’s look at their salaries in India and the USA.
- Salary in India: An average investment banker earns up to 18.5 lakh rupees per annum, according to Ambition Box.
- Salary in the USA: An investment banker’s average base salary is between 1L and 2L/annum, according to Glassdoor.
Investment Banker Jobs Available Right Now
Right now, if you just Google and browse ‘Investment Banking Jobs in India’, you will find out that just on LinkedIn, there are 5,000+ jobs available.
In the United States, the number is even better: 21,000+ jobs.
Future of Investment Banking (2025 & Beyond)
Rapid developments in the investment banking sector are being driven by technology, regulatory adjustments, and changing market dynamics. To stay ahead, future investment bankers must adapt to all the new trends presently shaping the industry.
Top Investment Banking Trends Shaping the Future of Finance
- AI & Automation in Finance – Innovation in financial modeling and trading will be augmented with AI-powered tools in the future.
- ESG (Environmental, Social, and Governance) Investing – There is a noticeable shift toward sustainable finance, and organizations have started to give more importance to green investments.
- Blockchain & Decentralized Finance (DeFi) – Traditional banking is being challenged by the emergence of cryptocurrency and DeFi.
- Global Expansion & Emerging Markets – Investment banks will place their attention on the rapidly developing areas of Asia, the Middle East, and Africa.
How to Stay Competitive in 2025 and Beyond?
- Develop Strong AI & Fintech Skills – Get a grasp on how AI-powered financial strategies are affecting the banking industry.
- Stay Updated on Regulatory Changes – With more stringent financial regulations being set by various countries, achieving compliance will be very important.
- Build Expertise in ESG & Sustainable Finance – Investment banking in the future will have an intensive focus on socially responsible investing.
- Be Open to Global Career Opportunities – Major banks are penetrating the Asia-Pacific, Latin America, and Middle Eastern regions.
The investment banking industry is not doomed; rather, it is transforming. Professionals adapting to AI trends, fintech, and sustainability will have a future.
Common Mistakes Aspiring Investment Bankers Make
Moving into the investment banking field is quite competitive, and indeed, it breaks many candidates because of some mistakes. Here is the list of avoidable mistakes:
1. Poor Understanding of Finances
Problem: Most applicants do not know how to deal with financial modeling, valuations, and deal structuring, but still apply regardless.
Solution: Acquaint yourself with financial modeling, DCF valuation, and M&A analysis before applying.
2. Ineffective Networking
Problem: Online applications are, more often than not, ineffective.
Solution: Make use of LinkedIn, go to finance-related networking events, and approach professionals in the sector for referrals.
3. Lack of Preparation for Technical Exams
Problem: Numerous people fail for reasons such as not being able to respond to questions such as “Walk me through a DCF value” or “How do you value a company?”.
Solution: Work on investment banking questions and practice case studies actively.
4. Lack of Appreciation for Soft Skills
Problem: Some solely rely on technical skills and keep basic communication and problem-solving skills as a backup.
Solution: Master client-facing skills that will assist students in banking services.
5. Ignoring Alternative Investment Firms
Problem: It seems like most people tend to focus on only JPMorgan, Goldman Sachs, Morgan Stanley, and not paying enough attention to boutique investment banks.
Solution: Target mid-tier firms before moving on to the bigger banks for experience.
Your chances of breaking into investment banking and securing a position at a major firm would increase if you avoided these mistakes.
Conclusion
For someone who brings a real passion for finance, deal-making, and working under extreme pressure, investment banking can be a really demanding but rewarding career. Following the right strategy with AI-powered tools and networking, you can have a brilliant career in investment banking.
Want to speed up the process? Then join the Investment Banking Certification Course by Intellipaat to acquire hands-on training in financial modeling, M&As, IPOs, and techniques of valuation!
The first opportunity is so important for this occupation that if you are willing to begin a career path, do not delay.
FAQs
Is it hard to become an investment banker?
Becoming an investment banker is not easy, as it demands long work hours, great competition, good technical skills, and educational background.
What companies hire investment bankers?
Top companies hiring investment bankers, according to Glassdoor are J.P. Morgan, Goldman Sachs, Citi, etc.,
How long does it take to become an investment banker?
To become an investment banker, you will need to complete education, projects, and necessary internships investing approximately 5-7+ years.
How much money can I make as an investment banker?
According to AmbitionBox, the average annual salary in India is about INR 18L, and according to Glassdoor, the average annual salary in the US is 145,190 dollars.
What are examples of investment banks?
Some of the top examples of investment banks are JPMorgan Chase, Citigroup, Goldman Sachs, HSBC, etc.