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【Major Divisions & Career Paths in Investment Banking】Job and Career Strategies for 6 Roles
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Investment Banking Major Divisions and Career Paths
~Various Entry Points from New Graduates and Mid-career Hires~
Foreign investment banks develop sophisticated operations across various divisions including M&A (IBD), Capital Markets, Trading, Research, Operations, and Finance. While each division requires different specialized knowledge and skills, they all commonly demand a globally applicable perspective and flexibility to adapt to challenging market environments. Here, I will explain in detail the entry points for new graduates and mid-career hires in each division, along with the required skills and career path characteristics.
1. IBD (Investment Banking Division: M&A and Capital Policy Advisory)
Business Content and Role
IBD is a division that provides advice on corporate acquisitions, mergers, business restructuring, and capital policies. It takes on the role of leading the entire project from deal sourcing to due diligence, negotiations, contract execution, and even post-merger integration (PMI). Advanced financial analysis abilities, industry knowledge, and negotiation skills are essential.
Entry Path for New Graduates
Recruitment Process: Selection is typically conducted through recruitment entries or internships. Initially hired as analysts, candidates participate in practical work after completing rigorous training programs and OJT.
Required Skills: Basic knowledge of finance and accounting, logical thinking, and mental strength to endure long-term projects. English proficiency may not be mandatory in some cases, but improvement is desired in anticipation of opportunities to work on global projects.
Career Path: Advancement from analyst to associate to VP, and after several years of practical experience, growth to director or partner class, often through obtaining an MBA.
Entry Path for Mid-career Hires
Recruitment Process: Mid-career recruitment often targets professionals who have already gained practical experience at other financial institutions, strategic consulting firms, or audit firms.
Required Skills: Since achievements and specialized knowledge are emphasized, experience with M&A deals, corporate valuation, and negotiation accomplishments become evaluation points. Additionally, English skills and experience working in multicultural environments are expected for assignment to global projects.
Career Path: For mid-career entrants, immediate effectiveness according to position is required, so they typically start as associates or VP-class and can advance to executive positions by gaining experience as project leaders.
2. Capital Markets (ECM & DCM)
Business Content and Role
The capital markets division supports fundraising for corporations and governments, promoting issuance activities in both equity and debt. ECM handles IPOs and capital increases, while DCM primarily deals with corporate bond issuances, working on formulating optimal issuance conditions while analyzing market environments and investor demand.
Entry Path for New Graduates
Recruitment Process: For new graduate recruitment, selection is conducted through internships, written examinations, and group discussions, as securities analyst perspectives and market analysis capabilities are required.
Required Skills: Ability to interpret market and economic trends, document creation skills using Excel and PowerPoint, and numerical analysis ability. English skills may be necessary depending on the project, and having a global perspective becomes a strength.
Career Path: Initially, experience is gained as junior staff, starting with assisting on projects. Gradually, one develops independent analytical skills and advances to become a deal leader.
Entry Path for Mid-career Hires
Recruitment Process: For mid-career recruitment, candidates with practical experience in ECM or DCM and knowledge of financial markets are sought. Experienced candidates are often hired for positions to lead projects as immediate assets.
Required Skills: Market environment analysis ability, negotiation skills, and track record in previous issuance projects. Global issuance experience is particularly valued.
Career Path: In mid-career recruitment, the starting point is often at a higher position than for new graduates, with early expectations to take on roles as project managers or team leaders.
3. Trading (Sales & Trading)
Business Content and Role
The trading division has the role of generating revenue through market trading of various financial products such as stocks, bonds, foreign exchange, and derivatives. As a front office function, it requires reading market fluctuations in real-time and making quick decisions. Additionally, it works in collaboration with the sales division to make proposals to clients.
Entry Path for New Graduates
Recruitment Process: In new graduate recruitment, basic knowledge of mathematics and statistics, programming ability, and sharp market sense are evaluated. Written exams, case studies, and practical experience through internships are emphasized.
Required Skills: Those with science backgrounds may find their mathematical strengths more easily appreciated, but humanities graduates can also excel if they have strong numerical abilities and can make swift decisions. IT literacy and English skills are also advantageous.
Career Path: Initially starting as a junior trader supporting market analysis, one builds unique trading strategies with experience, and eventually advances to become a discretion leader or team manager.
Entry Path for Mid-career Hires
Recruitment Process: For mid-career recruitment, market performance, trading strategy formulation, and risk management experience are required. Success stories from previous positions and expertise in specific markets become key selling points.
Required Skills: Rapid decision-making ability, stress resistance, and the insight to instantly grasp market trends are important. Additionally, programming and data analysis skills are expected for more quantitative roles.
Career Path: Mid-career entrants are often immediately entrusted with risk management and project leadership, and tend to advance to higher positions more quickly as they accumulate achievements.
4. Research (Analysis Division)
Business Content and Role
The research division conducts specialized investigations and analyses on trends in stocks, bonds, and the overall economy, providing the results as reports to investors and internal stakeholders. Covering various fields such as equity research, credit research, and macroeconomic research, both depth of analysis and clarity are required.
Entry Path for New Graduates
Recruitment Process: Through internships during university or analyst recruitment programs, candidates first learn basic analytical methods and industry trend recognition. Logical analysis skills and writing abilities are evaluated through written examinations and case studies.
Required Skills: Interest in specialized fields, deep research capabilities, knowledge of statistics and data analysis, and report writing skills. Communication skills to accurately summarize and convey market information are essential.
Career Path: Initially working as a junior analyst under senior guidance on report creation and data analysis, one gradually develops unique analytical themes to become a senior analyst, and further advances to division leadership positions.
Entry Path for Mid-career Hires
Recruitment Process: For mid-career recruitment, prior industry research experience, specialized knowledge, and past report and analysis achievements are emphasized. Materials and results demonstrating accomplishments are key to the selection process.
Required Skills: Market analysis, data processing, both quantitative and qualitative analytical abilities, and clear reporting skills. Specialization in particular fields can lead to hiring at higher positions.
Career Path: Mid-career entrants start at positions appropriate to their experience and achievements, and by demonstrating leadership within teams as immediate assets, they often advance to positions involved in formulating overall division strategy.
5. Operations (Back Office & Risk Management)
Business Content and Role
The operations division is responsible for ensuring that transactions generated by the investment bank's front office are completed accurately and smoothly, handling settlement and clearing, management of funds and securities, and maintenance of transaction records. As a middle office, it also performs risk management and compliance checks, playing a crucial role in supporting the operational foundation of the entire company.
Entry Path for New Graduates
Recruitment Process: For back office positions, programs are available through new graduate recruitment exams and internships to learn detailed business processes and system operations.
Required Skills: Accuracy, meticulous work ability, process management skills, and communication skills for collaboration with other departments within the company are emphasized.
Career Path: Initially serving as operations staff handling various tasks, some may transition to middle office or risk management divisions after experiencing process improvement proposals and system implementation.
Entry Path for Mid-career Hires
Recruitment Process: Mid-career recruitment seeks personnel with experience in system implementation, process improvement, and risk management within companies.
Required Skills: Knowledge of operational procedures, understanding of systems, achievements in business process improvement, and organizational coordination ability. Experience managing large transaction data sets or dealing with international standards is particularly valued.
Career Path: For mid-career entrants, the typical route is to engage in various operational tasks as immediate assets and then excel as managers or specialists in risk management divisions according to their experience.
6. Finance (Financial Management & Corporate Finance)
Business Content and Role
The finance division handles the investment bank's own financial strategy, fundraising, internal budget management, financial reporting, and management of capital adequacy ratios and liquidity. It serves as the "internal finance engine," optimally allocating corporate resources and maintaining global regulatory compliance and internal controls.
Entry Path for New Graduates
Recruitment Process: New graduate recruitment involves selection through written exams testing basic knowledge of finance, fundamentals of economics and accounting, case studies, and group discussions.
Required Skills: Numerical analysis, budget management, data processing skills using tools like Excel, and analytical ability from a management perspective. Even as new graduates, logical thinking and strength with numbers are valued.
Career Path: Starting as junior staff supporting internal budget management and financial reporting, the typical path is to advance to more strategic positions such as developing financial strategies and planning fundraising as experience is gained.
Entry Path for Mid-career Hires
Recruitment Process: Mid-career recruitment requires practical experience in financial management or corporate finance within companies, or achievements at external financial institutions.
Required Skills: Experience in financial strategy formulation, practical fundraising experience, operation of internal controls, and knowledge of global financial reporting. Qualifications such as MBA, CPA, or CFA are particularly appreciated.
Career Path: Mid-career entrants often join as core members according to their experience, frequently advancing to team leader or departmental management positions early on, taking on roles directly connected to corporate management strategy.
Conclusion
While the investment banking industry requires different specialized knowledge and skills for each division, a global perspective and flexible adaptability are common keys across all divisions.
In new graduate recruitment, basic knowledge, logical thinking, and above all, toughness and a spirit of challenge are valued, with practical skills being honed through rigorous training and OJT after joining.
In mid-career recruitment, past achievements, specialization, and English skills and international experience are valued as immediate assets, expanding opportunities for early promotion to management positions.
Regardless of which entry point is chosen, continuous skill enhancement and self-improvement in line with changing market environments will be the key to long-term career success. To excel in various divisions of investment banking, strategic self-investment with an eye toward expertise, global perspective, and flexible career paths is essential.
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