Operational investment banker job profile

Operational investment banking is competitive and as well as strong academic qualifications you'll need work experience in the financial sector

As an operational investment banker, you'll be responsible for the processing, clearing and settlement of the financial transactions made at an investment bank or management firm.

In the operations division, also known as the back office, you'll provide support to the client-facing departments, such as trading, corporate finance and corporate banking - sometimes known as the front office.

The front office generates business for the bank, and operations ensure that the business is administered in an efficient, controlled, risk-free and timely manner. You'll ensure that products, services and money change hands how and when they're supposed to and that each transaction is cleared, settled and reconciled according to regulatory requirements.

You'll also be involved in developing and implementing new systems in order to maximise efficiency and profitability for the bank.

Responsibilities

Operations covers a range of activities. Following the buying and selling of financial products and services by the bank, operations staff ensure that each transaction is:

cleared - funds and financial products have moved from seller to buyer
settled - ownership has been confirmed efficiently and accurately
reconciled - transactions have been correctly documented and reported.

The structure of departments varies from bank to bank, but you'll typically need to:

ensure that all processes are carried out efficiently and accurately so that business continues to flow smoothly
reconcile systems by checking that data flows from the revenue-generating front office to the operations systems (operations control)
monitor the activity and reports of daily transactions
investigate breaks in the cash account within an investment bank
liaise with clients regarding transaction settlements, as and when required
monitor and troubleshoot system problems, ensuring that everything continues to run smoothly
monitor potential risks that could result in financial loss penalties for either the firm or its clients
ensure that market and regulatory standards are adhered to.

As a manager of an operations team, you'll:

act as an interface with other divisions of the bank, for example, liaising with traders and ensuring all issues are resolved in a timely and efficient manner
recruit, train and coach team members
organise team meetings, manage team members and have responsibility for individual and team appraisals
ensure client protection rules are adhered to
make sure that processes are constantly improving, and participate in step-change improvement projects
manage projects such as analysing a system, identifying and specifying developments and improvements, and coordinating the testing and implementation of new systems.

Salary

Starting salaries in a trainee role are in the region of £25,000.
Salaries for analysts/associates with up to two years' experience are £35,000 to £50,000, rising to £65,000 for senior associates with around two to four years' experience.
As you progress your career salaries can be in the region of £60,000 to £85,000, rising to between £75,000 and in excess of £100,000 for those with six to ten years' experience.
Heads and directors of operations may earn between £100,000 and £180,000.

Salaries vary widely depending on your role, location and experience. Salaries in operations do not reach the levels of the revenue-generating front office roles, such as trading, but still remain high.

Remuneration packages in investment banks often include benefits such as health insurance, life assurance and subsidised gym membership, plus discretionary annual bonuses (based on individual and company performance).

Income figures are intended as a guide only.

Working hours

Investment banks have a reputation for long working hours. While this is true for divisions such as corporate finance, working hours in operations tend to be more regular. However, longer hours and some weekend work may be necessary to meet deadlines. You may need to work shifts to support front-end teams working on financial transactions in multiple time zones.

What to expect

The job is mostly office based. The working environment may be demanding with tight deadlines, but the role offers variety and challenge.
Although more companies are addressing the gender imbalance in senior management positions, women are still underrepresented. This is a recognised issue and steps are being taken to redress the balance. For example, some firms have signed up to the Women in Finance Charter, which commits them to supporting the progression of women into senior roles in the financial services sector. Initiatives such as Women in Banking & Finance also aim to encourage the potential of women in this career area. There are also a range of events, schemes and internships aimed at women.
Many jobs are available in financial centres, such as London, and other major UK and international cities. However, it's not essential for operational investment banking staff to be close to the trading floors, so there are increasingly opportunities in lower-cost areas in the UK like Bournemouth, and overseas in countries such as Poland and Hungary.
Job availability tends to fluctuate due to economic conditions. There are no opportunities for self-employment, though consultants may be used for major improvement projects.
There may be travel involved to some of the bank's other sites overseas, but travel opportunities are limited in operations, and will depend on the department or product.

Qualifications

To enter a graduate-level job in operations, you'll need at least a 2:1 degree. Typically, banks will consider graduates from any discipline but degrees that may be particularly useful include:

business management or business administration
economics
finance
international business
mathematics.

If you have a non-related degree, you will need to show an understanding of, and keen interest in, the business.

Entry into operations tends to be either as an administrator or as a graduate trainee, where you'll normally be known as an analyst.

Formal graduate schemes are competitive and you will need extra-curricular achievements and work experience, as well as a strong academic record.

There are some degree-level apprenticeships available, combining paid and part-time study in investment banking with major banks such as J.P. Morgan. For more information, see top UK banking apprenticeships.

Those with a Masters of Business Administration (MBA) and certain other postgraduate degrees, plus two to five years of relevant work experience, may be able to apply for a higher-level training programme as associates, but it's worth noting that these programmes are usually aligned to front office roles, such as corporate investment banker. Search for MBA courses.

Skills

Each bank will be looking for slightly different characteristics, but generally you'll need to have:

the potential to achieve a leadership position
a collaborative approach to work and the ability to work well in a team
excellent communication and interpersonal skills
skills in negotiation, persuading and influencing others
IT skills
excellent numeracy and analytical skills
a proactive, creative and innovative approach to problem solving
consistency, accuracy and attention to detail
excellent organisational and time management skills
passion and self-motivation
resilience and determination and the ability to work well under pressure
personal integrity
risk awareness
the ability to grasp new concepts and adapt quickly to changing circumstances.

Fluency in another language is also useful as many banks have international offices.

Work experience

To gain an interview for a graduate programme you'll need a full CV. This could include experience from:

an internship at an investment bank
positions of responsibility in societies or sport teams
part-time work alongside your degree
evidence of sustained interest in finance, such as managing a shadow portfolio of investments.

Many of the large investment banks provide internships over the summer, that typically last 10 to 12 weeks and are aimed at students in their penultimate year. If you do well during an internship, you may be considered for the organisation's graduate training scheme.

Some firms also offer shorter internships available in the spring, which you can usually apply for when you're in the first year of your degree. Check the websites of the investment banks you're interested in for further details and research the sector thoroughly.

Networking with employers is also important to help build up a list of contacts.

Find out more about the different kinds of work experience and internships that are available.

Employers

Operations professionals are recruited by investment banks and private equity fund institutions.

Investment banks come in many shapes and sizes, from smaller or niche players, such as Lazard and Rothschild & Co, to global organisations, such as:

Barclays
Citi
Deutsche Bank
Goldman Sachs
HSBC
J.P. Morgan
Morgan Stanley
UBS.

Graduate scheme deadlines vary so check on company websites. It is advisable to apply as soon as possible as they often interview before the closing date is reached, and recruit on an on-going basis.

The banking sector is a volatile one and investment banks are affected by economic cycles, which have a knock-on effect on graduate recruitment.

London and New York have dominated financial employment in the last few decades, but increased growth in emerging markets such China have led to other financial centres growing around the world.

Look for job vacancies at:

You can also check the national and financial press, such as the Financial Times, The Guardian and The Times, as well as websites of individual banks.

Professional development

You will be trained on the systems and products that your department supports. As these change regularly, all employees will undergo training at least yearly.

If you're on a graduate development programme you'll undergo a structured set of training courses and coaching sessions to develop the knowledge, skills and experience needed to become a manager, typically over a two-year period.

Sponsorship towards professional qualifications is often offered to those identified with the potential to progress up the ranks. The Chartered Institute for Securities & Investment (CISI) provides a range of qualifications for the financial services industry, some of which can lead to chartered status. Qualifications include:

Investment Operations Certificate (IOC) - for staff working in, or aspiring to work in, the administration and operations areas of financial services
Certificate in Managing Operational Risk in Financial Institutions - for those involved in risk, compliance and investment risk control
Diploma in Investment Operations - aimed at those in a supervisory position looking to move into a senior management role. It provides the opportunity to specialise in the administration of investment funds and custody and settlement and gain a broad understanding of the wider financial environment.

See the full list of CISI qualifications.

There are various other professional bodies that offer training and support, such as the:

Career prospects

You will typically start out as an analyst before moving into the role of associate after around three years. Career progression is influenced largely by your performance and you can move into roles with more responsibility as your career progresses.

You're likely to stay at associate level for a minimum of two years before moving into the role of vice president with responsibility for leading a team. Further promotions are to director/executive director and finally managing director. At the highest levels you will have responsibility for strategy and direction. Competition for roles, particularly at senior management level, is high.

There are also options to move into project management or into a specialist role such as IT or HR.

Operational investment banker