What Do Investment Bankers Do?

Investment bankers play a crucial role in the structuring of financial operations found within all types of businesses, and more importantly, they help the economy to progress. Most investment bankers are highly-skilled as well as paid good. They spend their time giving companies advice in regards to the issuing of stocks and they help configure stock offerings. To become this type of banker, a person will need to successfully take part in an MBA program.

Job Outlook

Through the year 2018, it is predicted that the employment outlook for investment bankers is very favorable. A major contribution to the growth of this occupation is the fact that baby boomers are entering into retirement and have a strong demand for the expertise of investment bankers. With a strong background in finance, an MBA degree as well as appropriate licensure and certifications, a person will be well on his or her way to becoming an investment banker.

Job Duties and Responsibilities

Businesses are oftentimes funded by an assortment of investors. These investors tend to provide their funds through the forms of bonds and stocks. Investment bankers are the middlemen. They connect the businesses with the investors. Many times, investment bankers spend their time helping private corporations structure initial public offerings, which results in the private entities going public. Since initial public offerings are restricted by strict financial regulations, businesses rely on investment bankers to make sure they are in compliance with all regulations.

There are several areas of specialty found within the occupation of investment bankers with one of them being mergers and acquisitions. When working in this specialty area, investment bankers spend their time helping businesses acquire, purchase or merge with other businesses. They inform a business on how to go about properly structuring a deal and they also help in the development of detailed contracts.

Some investment bankers work solely as portfolio managers. In this line of work, investment bankers take money that is pooled together from several clients and use it to create a profit by buying and selling assets. Portfolio managers spend their time researching market trends as well as choosing where to invest funds. Sometimes, they may choose to work by their selves; however, some choose to work with other portfolio managers.

Investment bankers that work as financiers are responsible for helping their clients solve budgetary issues. Such issues may include coming up with ways to raise money for new ventures and developing methods to streamline business costs. Many times, when working as a financier, an investment banker with specialize in a certain industry such as healthcare.

A large amount of time spent working by investment bankers involves communicating with clients. This communication may take place in person, through emails, over the phone or through video conferencing. For the most part, investment bankers conduct much research, spend large amounts of time creating reports and they tend to be responsible for making sure the data in spreadsheets are properly maintained.

As an investment banker, a person should expect to work long hours as well as travel a lot. In fact, in some instances, in may be required that the banker travel on an international basis. When traveling, an investment banker will meet with existing and potential clients, develop and close deals and much more.

Salary

Although investment bankers work long hours, they tend to be greatly compensated for their time. In fact, the average salary of investment bankers was about $95,000 a year during 2010. In addition to the average salary of investment bankers, they are usually paid commission for the deals that they close. Many times, they are fully compensated for their travel expenses with many of them also driving company vehicles on a daily basis as well as charging certain expenses, such as food and gas expenses, to a company credit card.

How to Become an Investment Banker

To become an investment banker, a person will need at least a bachelor’s degree in finance or a related field. Most employers will prefer a master’s degree. Many investment banker job positions include on-the-job training, with the training period lasting anywhere from two to three years. When entering into this line of work, a person will benefit the most from earning an advanced degree. In doing so, this helps to broaden employment opportunities, and furthermore, it helps to increase an investment banker’s salary level. Read our full guide on how to become an investment banker.