I'm looking into a Private Banking Analyst position at J.P. Morgan. I'm a senior at a semi-target, and I've worked in PWM before.
I'm curious to know:
-How does private banking differ from general wealth management (besides just the pure dollar amount needed to be a client)?
-
How actually "analytical" would an analyst position in private banking be? Would I be "supporting" higher-ups or selling more often than managing asset allocation, running performance reviews, and generally staring at Excel?
-
Would this be a good transferable position into other areas of Asset Management (i.e. portfolio management, hedge funds, institutional fund/mutual fund management)?
Thanks
1) Doesn't differ at all besides investment options 2) Not analytical at all 3) No you never see someone from PB go to portfolio management, you could work at as a salesman for an AM shop but definitely not as a PM. If that's your goal you'd have to start in IB or ER.
Lets see Future Banker, you're wrong on all three accounts. To be honest, here's how it goes:
1) It allows you to better serve your client's needs. It all depends on your client's needs and the shop you are at.
2) The answer is that it depends on the structure of your account and clients. I know people in PWM that have a high degree of analytical basis and I know others that have no need as their basis is managed money. That said, it all depends on your client base. As to the second part, it depends on who you work for. That's the straight up truth.
3) The answer is an astounding yes, however, it is a yes with a caveat. That caveat is pretty simple... either you work for a team that directly manages their own discretionary money or not. If you work for a group that has a discretionary account base, you can segue into being a PM more readily than you would expect, especially if you can site performance.
Hope that helps.
Thanks for that... Are you referring to discretionary money as in the client fully entrust to the firm to invest as they like as opposed to needing to send out investment suggestions?
Is the PM of funds of funds much different than PM of individual securities?
PM me
There are portfolio managers within the private bank doing mostly fund of funds work. It's incorrect to say that you never see people from PB going to portfolio management when in fact it's quite the opposite. Not all PB roles are sales roles, some are highly quantitative.
Plus a random questions, I notice that in Asia most private bankers are girls? Is that the same in the US/UK?
No. I was at a top PB this summer and rest assured, 99% of the RMs were men.
How was your experience? Besides the lack of distractions in the office haha
Discretionary is a term used to discuss who has the ability to make the investment decisions. In Asset Management, if you give your money to a financial advisor/hedge fund/private equity fund/etc., unless you explicitly give that person the authority to invest in a manor they see fit, you are the ultimate person in charge of what happens in your account. This is why, when you invest in PE and Hedge Funds, you agree to give away any authority to invest - it's written into the subscription documents.
To further illustrate... You have 10MM in your account with a broker at say... UBS. He has an idea that he thinks is a good play. Unless you have that money in an account that he has agreed to take a direct fiduciary responsibility in managing it, he would need to call you and discuss the idea with you. However, if you agreed to let him manage the account, he could buy and sell as he wants. You traditionally see this when you have brokers that have specific strategies that they use (ie. Uncovered S&P Options trading strategy, Custom EM Portfolios, I know a guy with a Volatility management strategy that he uses for clients with extremely concentrated positions, etc.).
Hope that clears things up.
Thanks.
Thanks whoever threw shit at me. If you look at the paths of any mutual fund manager, or asset management firm like Wellington's portfolio managers, you will see they pretty much all came up through IB or through equity research. The one exception is people who were in some specific industry i.e. energy then got an MBA. You will be doing fund of funds type stuff. It's the same as welath management only your options are bigger, i.e. 10mm may gave you access to HFs or PE firms you wouldn't normally. Other than that it's the same hustle. To be a portfolio manager you would really have to have in depth modeling experience that would only be gained through IB or ER
FutureBanker09 - While in general I agree with you that it's an uphill battle to transition from PB to portfolio management, it definitely can be done, especially if your PB experience is with a reputable PB analyst program like JPM, GS or CS as opposed to getting PB experience at places like ML, MSSB or UBS where you are doing a lot of cold calling.
As with most everything else, you get what you put in - if you work hard, do some things to separate yourself from the crowd (CFA, etc), there is no reason why someone can't make the transition.
Tan86, the reputable shop issue is definitely a given in this case. However, it really depends on the nature of what you do and what group you are in within any top tier PWM Shop.
I'll give you guys the case of two friends of mine who were both at top shops in PWM. One of my friends is now a junior PM at a DC based asset management shop and at his time working for BB PWM, he was his team's portfolio analyst. He left the PWM shop in May of this past year and has been with his new firm for about 3 months. The team he was working for had between $75MM - $100MM if I recall in a discretionary portfolio, and he did everything - from valuations to position analysis, research to reporting and everything in between.
The second was of a case of a friend of mine who had a similar situation, as the portfolio analyst for a team of Financial Advisors before moving on to work for the BB PWM's Chief Investment Officer. He was a smart kid and had completed his CFA L1 and L2 before he ended up leaving for a Hedge Fund about a year and a half after transferring into the CIO group. I know it's two cases, but the avenues are definitely there.
It really is all about the experience you end up getting from whichever group you are in and how you choose to leverage it.
Private Banking vs Investment Banking (Originally Posted: 03/06/2013)
Hi Everyone! I am relatively new to the world of financial services so please excuse my ignorance.
What is the difference between Investment Banking and Private Banking?
Thank you in advance for answering.
Holy hell. I could write a book on this, but in the interest of time:
1) Private Banking is wealth management for high net worth and ultra-high net worth clients. Private banks handle client's investment, credit, banking and trust & estate planning needs.
Investment banking is advisory and underwriting work for public and private companies. Could be helping with a company going through an IPO, issuing debt, private placements, underwriting municipal debt for municipalities (public finance), or it could be advisory work on the M&A transactions of companies and PE firms.
2) Minimal on the base level, very large on the bonus level, especially at the early levels.
At my firm, base is 70K for first yr analysts, 80K for second yrs. The PB has 3rd yrs which get 90K base. However, at the bonus level the IB bonus will typically be anywhere from even (best analysts in PB will get bonuses around what a bottom bucket IB analyst will) to 40K+ more (worst analysts in PB vs top bucket IB)
At the higher levels, IB tends to make more, but it varies so much based on performance I could not even begin to throw out estimates.
3) The day to day will be different. At the analyst level, PB analysts put together performance reports and asset projections and do prospecting, while IB analysts do modeling/DCFs/ all that good jazz.
IB day-to-day stuff at the analyst level tends to be more stimulating if you are into numbers, and have a higher interest in private markets vs public markets
PB day-to-day stuff for analysts will be more your speed if you like public markets and want to have some client facing activity. I'm a first yr analyst in PB and I have started to go with my banker on client/prospect meeting a decent amount already only 6 months in because I've absolutely busted my ass and have shown I'm not entirely incompetent. This week was the first time my banker let me pitch something to a prospect, and it was a rush. Being 22 and confidently pitching some of our capabilities to a 50 year old prospect worth $10MM and then having him pulling your banker aside after the meeting to tell her how impressed he was with her analyst is the high point of my short professional life by a mile.
At the higher levels, the differences kind of converge. BSD MD's will just go out and bring in clients and make it rain, albeit the nature of the relationships is fundamentally different.
Also, maybe the biggest distinction, hours are much less at the PB level throughout every career level, hence the lower pay.
Hope this helps!
And any IBers out there, please feel free to add color to anything I may have gotten wrong in my comparison, because this is just from my understanding of the investment banking through prepping for interviews and talking to my numerous IB friends at different firms.
Another PB newbie here with some questions for you (if you wouldn't mind answering of course)
Wow! Thanks so much!
PB recruitments are target based. If you fulfil their target at a time you are announced best employe.
Private Banking job & lifestyle (Originally Posted: 05/28/2010)
Hi,
I was wondering what are the real responsibilities of private bankers? Do they work on strategies to preserve wealth (forecast, portfolio, taxes...) or are marketers who are essentially rich people's bitches? (found this somewhere here)
Is the fact that PB manages money of individuals as opposed to institutions (Asset Management) the only difference?
Thank's.
Private banks provide a lot of services to wealthy individuals; not just being their 'bitch'. I have a friend working at Credit Suisse who told me he had people working below him who brought in more revenue, but did no actual work and knew very little about Finance itself. Not sure how true this is, but it seems to be the case in some of these places.
Also, PB provides AM services too.
Is PWM the same thing as Private Banking? (Originally Posted: 01/08/2013)
Is PWM the same things as Private Banking? Aren't they both catering to HNW individuals? Is there a difference?
Thanks.
not sure if you are still keen for an answer, but somewhere in this thread some folk explained that nicely. i'm not qualified to share a link but please check this: JPMorgan-private-bank-compensation-ladder-lifestyle
PWM and Private banking both fall under the wealth management umbrella. It varies from firm to firm, but PWM = HNW and PB = UHNW (Ultra).
Investable assets separates the client groupings (General Ranges).
PWM = $1M - $25M PB = $25M+
http://www.wallstreetoasis.com/forums/jpmorgan-private-bank-compensatio…
BB Private Banking (Originally Posted: 07/23/2007)
Thoughts?
Do you want to know about Wealth Management and Private Client services, or Private Placements? . . . not too descriptive.
Private banking is a separate category that seems to be growing quickly.
I can see info from company sites like below, but it doesn't really give you too much info.
http://www.jpmorgan.com/pages/jpmorgan/private_banking http://www.citibank.com/privatebank/
What do people in PB make down the road - like after 7-15 years?
See the Asset Management section (PB does fall under AM).
It depends on who you ask, though. A lot of people on here are die-hard, balls-to-the-wall IB prospects. They'll bitch about "oh PB is for pussies" and whatnot. Really, though, if you're looking for a work/life balance this seems the way to go.
and you can live in almost any city in the country. I know a 1VP in Pittsburgh that doe PWM (similar) and makes ridiculous money. Plus he goes to pro athlete's houses and shit fairly regularly
Private Banking vs Private Wealth - Which one is more prestigious (Originally Posted: 06/28/2007)
What is the difference between private banking and private wealth and which one is more prestigious?
Private Banking - managing Shaniqua's checking account and sending her statements when she fails to pay her credit card on time (again)
Private Wealth - telling Shaniqua which mutual fund / asset mix she should use to enhance her lifestyle come retirement and then liquidating her account when she can't cover margin calls.
Correct me if I'm wrong, but isn't private banking slightly more selective than managing "Shaniqua's" checking account. I have a cousin doing private banking with JP Morgan, and there, I believe clients must invest a minimum of 25 million dollars.
Private Wealth, as I understand it, is similar to what NoTears described it as. You basically do financial planning for clients.
They dont really bother with people that have 25mill. They can get into the PB but the bank has much bigger fish to deal with.
Think of PB as your standard chase branch but for people who have 100mill+ net worth.
Sounds basic, however you have to take so much of their personal status into account. You advise them on investing etc.
Very interesting and personal job. You wont get the same bonus as IB FO but your salary is on the same level and the bonus is good enough to put a down payment on a house down.
Et rem est in ut aut minus dolores. Beatae quia voluptatum ratione nihil dolores.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...
Asperiores dolore dolores aut et consequatur aliquam accusamus. Facilis et iure hic molestiae ipsum perferendis voluptatem. Sit consequatur saepe quod optio. Sapiente distinctio quod dolor incidunt.
Maxime quis soluta sequi et. Quidem occaecati sit laudantium et. Ut enim provident temporibus assumenda. Eveniet facilis sint a et rem.