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Investment Banking Analyst - Salaries, Roles, & Responsibilities

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This blog primarily focuses on the salary an Investment Banking Analyst get each year. We already know that salary is based on various factors like skills, experience, and the location where one is employed. Let’s discuss in brief about Investment banking analyst salary.

Table of Contents:

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Investment Banking Analyst Responsibilities

As an analyst one can expect to spend major of their time doing the below-mentioned tasks:

1. Examining Industry Research

Analysts working in investment banking are typically classified according to their respective industries, such as finance, healthcare, manufacturing, or emerging markets.

They will speak with business leaders and investors to try to make arguments for or against investments in particular businesses or industries.

2. Building Financial Valuation Models

For an investment analyst, proficiency with online spreadsheets and investment models is essential.

New analysts will be required to track financial patterns, isolate company and revenue cycles, and assess performance in more competitive global marketplaces.

3. Producing Investment Presentation

For both institutional and retail investment banking clients, new investment banking analysts are expected to have strong communication skills.

Key responsibilities for banking analysts include conducting research, writing, and editing research reports, progress reports, PowerPoint presentations, and pitch books for new initial public offerings.

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How to become an Investment Banking Analyst?

How to become an Investment Banking Analyst?

The field of Investment banking is highly competitive. One must possess excellent skills in order to stand out from the crowd. Below listed are some of the basic qualifications required to become an Investment banking analyst.

A Bachelor’s Degree

Completing your undergraduate degree is the first step towards becoming an analyst in investment banking.

Accounting, finance, and mathematics are common majors for prospective analysts.

However, several successful investment banking analysts majored in fields like a foreign language or science that have nothing to do with their field.

Whatever major you choose, be sure you can market your undergrad talents in interviews for investment banking analyst positions.

An Investment Banking Internship

Working with professional investment bankers and getting more practical knowledge is one of the finest ways to enter this world of investment banking.

Internships provide you with an opportunity to gain skills and experience that will heavily impact your future journey.

Another big advantage of Internships is that you get to make new connections with people who are in this field. Having a good network can provide you with exciting career opportunities post-internship.

An Industry Certification

Individuals who are certified with CFA (Chartered Financial Analyst) certification are considered to have better knowledge of financial practices and regulations.

CFA certification holds a high value when it comes to considering someone for an investment banking analyst position and it can provide you with an upper hand while securing jobs in big firms.

You should either be in your final year of your bachelor’s, have a degree, or persist in at least 4 years of professional work experience in order to be eligible for CFA certification.

There will be a total of 3 exams that you will be required to pass in order to receive your CFA certification. These exams will test your knowledge of finance, security analysis, accounting, ethics, and economics.

These exams are conducted in a fixed order in the form of three levels as described below:

  • Level 1: This level will consist of topics like professional ethics and standards, economics, financial reporting, quantitative methods, fixed income, and analysis.
  • Level 2: This level will test how well you evaluate the processes and apply the assessment tools in some specific situations.
  • Level 3: At this level, your hold on advanced concepts will be tested.

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Investment Banking Analyst Salary Structure

Investment Banking Analyst Salary Structure

The salary of an investment banking analyst is comprised of five components:

  • Base Salary: This is the money you receive in your account each month.
  • Stub Bonus: Analysts who start working in mid of their graduation period receive “stub bonuses” for 6 months. This amount is typically 20-30% of their first-year salaries.
  • End-of-year Bonus: After completion of one year of work, a year-end bonus is credited to you. This bonus can be cash or stocks depending on your position and experience.
  • Signing Bonus: Analysts who are hired for full-time positions receive this bonus, which can range around $10-$15K.
  • Benefits: Investment banker gets great health insurance, vacations in the best cities, and many more benefits as they get promotions.

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Investment Banking Analyst Entry-Level Salary

Investment Banking Entry-Level Salary

An entry-level investment banking analyst can expect to earn around Rs.5,32,986 per annum in India.

This salary consists of all the tips, bonuses, and overtime pay and may vary depending on them.

In the US the average annual salary of an analyst is around $77K and it also varies based on the extra compensations.

Investment Banking Analyst Salary in Different Countries

Investment Banking Analyst Salary in Different Countries

Analyst salary In the United States – Investment banking analysts are paid the highest in the US, the starting salary ranges between $75,000 to $96,000 per annum.

Let’s try to include bonuses in this salary, suppose someone earns in the range of $85,000-$100,000 then he can expect a bonus worth up to $50,000 per year.

Analyst salary in the United Kingdom – The average base salary for investment banking analysts in London is around £50,000 to £60,000.

Bonuses can range from £30,000-£35,000 per year for analysts. With a few years of experience, one can expect to earn bonuses worth up to £50,000.

Analyst salary in Canada – Investment banking analysts in Canada earn comparatively less than the US or the UK. The base pay of an analyst in Canada is around C$87,000 per annum.

The bonus on the other hand is expected to be around C$4,730 per year.

Analyst salary in India – In India the average annual salary of an investment banking analyst is around Rs.10,71,900. The average bonus on this salary can reach up to Rs.57,000 per year.

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Factors Affecting Analyst Salary

Factors Affecting Analyst Salary

The in-hand salary of an investment banking analyst is dependent on various factors. Let’s discuss them and how they affect the income of an analyst.

Experience– More the experience is, the more amount of money is in salary and compensation. Having a higher level of experience also helps to get high recognition in this industry resulting in quick promotions.

Skills– Having higher relevant investment banking skills can result in staying ahead of the competition. It won’t be wrong to say that more the skills, more the money is earned by an analyst.

Company– The company for which you work as an analyst affects your salary the most. You can have the same skill set and still get paid less if you work in mid-sized companies compared to top market players. Big companies like Goldman Sachs, and Morgan Stanley tend to pay more compared to other companies in the industry.

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Investment banking’s growth is anticipated to be influenced by a number of variables, including technological advancements, changes in the state of the world economy, and adjustments to the regulatory landscape. Despite being demanding and challenging, a career in investment banking can prove to be a rewarding one.

So this was a short wrap-up.

Hope we were able to make you clear with the topic, we will be back with more till then keep learning.

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