How to Become an Investment Banker: Your Ultimate Guide

Becoming an investment banker is a very lucrative job profile. In order to know how to become an investment banker, you must follow this guide until the end.

As soon as you hear about Investment Banking, many questions influence thoughts like How do I become an Investment Banker?, What are the Investment Banking Opportunities in India? Which are the top Investment Banking firms in India? Are you looking for answers to these questions, then do not worry we are here to help.

As it will shed light on the insights of the investment banking world including what investment bankers do, what qualification is required to become an investment banker, how long would it take, can it be easily accomplished or no, along with its beneficial job prospects. 

So whether you are starting after 12th grade, BTech, or an MBA, this guide will provide essential steps and strategies on how to get into investment banking.

Define, What is an Investment Banker?

An investment banker, in layman’s terms, is an investment professional responsible for managing the overall investment decisions of an organization, government, or other corporations. Investment Banking professionals combine their professional expertise, and analytical skills along with great communication to support businesses raising mergers and acquisitions. 

Investment bankers play a crucial role in the financial growth and development of organizations, businesses, and other corporations; sometimes they even lend their services to the government providing strategic financial guidance. Their proficiency in handling intricate financial transactions guarantees that companies and governments obtain the required capital for growth, advancement, and novelty. The market expertise of Investment bankers determines the direction of the economic landscape of the businesses.

Investment banker, being a broad term covers various roles from entry-level work to executive vice president and beyond. Therefore, let us now move on to discuss what does an Investment Banker do, their job responsibilities, and the duties they perform.

What Does an Investment Banker Do?

Investment Bankers’ role is evident in the success of the company’s development. This is a highly desirable profession in India and abroad offering rich networking opportunities and high salary packages. So, what do Investment Bankers do, they exert themselves on a daily basis as working as an investment banker is a demanding job. It is fast-paced and stressful in comparison to those who get to enjoy work-life balance. So, if you seek a flexible work shift of 40 hours weekly or less than that, investment banking may not be the right path for you. 

Following are the job responsibilities detailed explanation of actually what does an investment banker do:

Capital Raising

The prime responsibility of Investment Bankers is to raise capital to fund, expand, transform operations, make an acquisition, or alter their capital structure from investors by issuing bonds or stock shares, or arranging for deals to be underwritten. So, an investment banker is expected to be proficient in Book Building, Prospectus Drafting, Initial Public Offerings (IPOs), “Roadshow” Investment Meetings, and Issuing & Selling Securities.

Pricing Capital

Before raising additional money from investors, it is also the job of an investment banker to decide on the cost of money that a company needs.

Placement Capital

Raising capital by selling equity shares to reserved investors is one of the ways to raise capital for businesses. So, investment bankers are also responsible for arranging these equity offerings to ensure that shares are priced fair. They advise companies on equity sale timing, structure, investor identification, and regulatory compliance to ensure successful capital raises aligned with the company’s financial objectives.

Mergers and Acquisitions

Investment bankers also help in cracking fair deal prices for their clients and sometimes assist companies throughout the process of mergers and acquisitions by applying financial modeling, valuation analysis, and financial metrics to predict the performance of businesses. Then, after mergers they reorganize the company’s management, finances, and operations to improve its efficiency and effectiveness.

Investment Decisions

Investment Bankers study the current investment scenarios to identify the risks related to any investments so that they can make informed investment decisions, whether to move forward or not to avoid losses.

Other Activities

As an Investment Banker, you are also expected to have additional knowledge of drafting prospectuses, advising on hedge funds, mutual funds, and pension funds, and more to be an expert. 

An investment banker must be technically sound to automate and streamline processes while also creating PPTs to outline benefits, risks, and timelines for clients and stakeholders. This technical expertise not only enhances efficiency but also enables them to present complex financial strategies in a clear and concise manner so that they can decide and facilitate the smooth execution of deals.

What Qualifications Do I Need To Be An Investment Banker?

To understand how to become an investment banker, it is essential to build a strong foundation of financial expertise in formal education and early work experience. Your resumes must include financial advising, management, trading, or business consulting experience. Most of the investment banking profiles seek undergraduate and graduate degrees in business administration, finance, commerce, economics, or analytical fields, along with a strong grasp of financial modelling. While other backgrounds are also acceptable, anyone can make a transition to become an investment banker but possessing quantitative acumen and persuasive communication skills are crucial for success. Therefore, you should follow the necessary qualifications to become an Investment Banker include

Senior Secondary

You must have passed the 12th Std exams with a 50% aggregate score, and possess basic knowledge in mathematics, accounting, economics, computer technology, and business.

Graduation

A bachelor’s degree in finance, business, or economics is essential for investment banking careers. Graduates or recent students can gain hands-on experience through internships in investment banks or brokerage firms as Junior analysts.

Masters Program

A strong finance background is crucial in investment banking, and a 2-year MBA degree from a prestigious B-school offers opportunities in the banking, finance, and insurance industries, including investment banking, research analysis, and financial consulting.

Certified Qualifications

Chartered Financial Analysts, Chartered Accountants, and ACCA qualifications are all valuable for a career in investment banking. The CFA program offers knowledge in economics, corporate finance, derivatives, fixed-income, alternative investments, and financial reporting. ACCA provides a strong foundation in financial management, accounting principles, and analysis.

After your master’s, you can improve your technical and analytical skills along with an internship at any of the banks in India to make an entry into the Investment Banking sector. 

Is It Hard To Become An Investment Banker?

Investment Banking is a challenging domain to make a career in. It requires advanced financial and analytical educational knowledge both theoretical and practical. Many consider it to be super tough to crack into the investment banking industry because they have to deal with highly complex financial transactions. In addition to tertiary educational qualifications, investment bankers obviously need to be excellent in their mathematical skills and their ability to think critically and solve problems in high-pressure environments are qualities essential for navigating the complexities of the industry.

How Long Does It Take To Become An Investment Banker?

As such there isn’t any specific duration defined to become an investment Banker but yes, it is a long process as you must complete your conventional course of study which is higher secondary, senior secondary, and graduation. Then, you can decide on choosing a certified qualification to become an Investment Banker.

Therefore, it may take 5 to 10 years depending on the course of study you decide on to move ahead after your senior secondary. You have varied choices to do financial modeling, CFA, or any other certified courses to work as an Investment Banker. The course duration also differs, so the total duration of becoming an Investment Banker varies.

How to become an Investment Banker in India?

Embarking on a career in investment banking in India requires a strategic approach and a clear understanding of the industry. To effectively learn how to get into investment banking, you must 

• First, pass your 12th from a recognized board of examination.
• Then, enroll in any bachelor’s program that aligns with your course of study especially in finance.
• After that, finish your Master’s program, an MBA in finance, economics, accounting, or business.
• By now, you have been well-versed with the intricate financial concepts and this knowledge serves as the base for your advanced professional certification course to become an Investment Banker. So, select a course like CFA, or Financial Modeling and Valuation Analysis to further hone your skills, deepen your understanding of the industry, and enhance your qualifications, making you a competitive candidate in the investment banking field.
• For that, get enrolled in any of the best finance and accounting coaching institutes as there are many available all over India. You can also choose from the top listed institutes:
  edZeb
  IMS Proschool
  The WallStreet School
  Zell Education

• You can choose the right coaching center by considering some of the basic factors like quality education, charter holders’ faculty, affordable fees, flexible class timings, and result-driven coaching.

So, follow these above-mentioned steps to smoothly complete the process of becoming an Investment Banker.

Benefits of Investment Banking As a Career

Investment Banking career offers various advantages that most of us imagine. 

1. Investment banking is one of the highly sought-after jobs all over the world.
2. Investment Bankers’ salary packages are significantly higher than the other job roles in the finance industry.
3. Entry-level investment bankers step up the ladder to senior positions in less time, unlike others. 
4. An Investment Banking profile also exposes you to global financial industries.
5. It also gives you the stability that most of the professionals seek, especially when they face the challenges of a mid-life crisis.
6. It is considered to be an elite job profile as the work done by the professionals holds a good reputation in society. 
7. Most importantly it is a white-collar job.
8. Lastly, as an investment banker, you will always be in high demand as they are the most sought-after professionals in the finance industry. 

There are numerous Investment banking opportunities in India, LinkedIn has 4000+ Investment Banking jobs, approx. 8596 on Naukri, and on other portals hiring for the top Investment banking firms in India like ICICI, Yes Bank, Motilal Oswal, HDFC, JM Financial, Centrum Capital and many others offering highly competitive salaries in the industry.

How much does an Investment Banker Earn?

As an Investment Banker, you will get a handsome salary package. These jobs are among the highly paid jobs in India and abroad due to their crucial roles in capital markets, mergers and acquisitions, and financial advisory services. Moreover, the yearly compensation is a composition of the basic salary, and additional benefits packages including bonuses, and other perks. 

According to Glassdoor, the average Investment Banker’s salary is INR 29 Lacs per year, with an average additional cash compensation of INR 18,50,000. If you knew this earlier, you would not waste time thinking, How can I become an Investment banker? Instead, you would have made an effort and googled How do I become an Investment banker to follow the right path and start working towards achieving this lucrative career option. 

To get an idea of what freshers and experienced investment bankers earn, we have given approximate figures.

• Entry Level Investment Bankers’ salary ranges from 10 to 15 Lacs per annum.
• Mid Level Investment Bankers’ salary hikes from 20 to 30 Lacs per annum for 3 to 5 years of experienced professionals.
• Senior Investment Bankers’ salary with more than 7 years of experience ranges from 35 Lacs to 50 Lacs or more.
• The executive level investment Banker earns double the salary received by the seniors. 

Therefore, it is one of the most highly paid-jobs offering financial security and lucrative growth opportunities for professionals at all stages.

Conclusion

Making a career in Investment banking, no doubt, is a challenging task but it proves to be more rewarding in terms of financial compensation and career growth. It would be a near to impossible dream come true if you lack dedication, determination, academic excellence, and a strong set of analytical and mathematical skills in finance. So, if you are wondering, how can I become an investment banker? Simply start by building the necessary skills and learn the complexities of the investment banking world to get into this competitive industry. 

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