AMA: Analyst at the Risk Management Department of a Major European Central Bank

PSR666's picture
Rank: Chimp | 11

Mod Note (Andy): Would you like to do an AMA? Email me [email protected]

I'm an analyst at the Risk Management Department of a major European Central Bank and I'll be moving to Sales and Trading the next Summer for an internship in the equity derivatives desk of a an American Bank.

Bio: Bsc. Mathematics, Master of finance, and currently a phd candidate. Moved to central banking in 2012.

Questions I can help answer: Making the transition from regulator to "regulated", interviews, motivation, stress management, how to make it from a non target - open to anything really.

Comments (13)

Mar 25, 2014

How many years of experience?
What does your background look like (work experience, internships, etc.)?

Mar 25, 2014

Animalz, I have two years of corporate experience. Previous internship at central banking (Statistics), was TA for 2 years before.

Mar 25, 2014

Few things...
You are going from a fulltime job to an internship, are you worried about not receiving a fulltime offer?

How did you go about getting the interview at another bank for an internship? Considering you are well out of college, coming from another bank, and without any S&T experience already...

Did you try to do it internally? Experience?

What specifically do you do in Risk Mgmt? Counterparty risk? Country risk? Credit? Market? Some of these are far better than the others to move around so this makes quite a difference.

Mar 25, 2014

yeahright, good points thanks. I am worried of course, although I must say that I always wanted to try S&T, so I couldn't refuse it. I , myself, traded as a hobbie for quite some time, and I have the necessary drive. I applied online and went through all the regular proccess. I do Counterparty.

Mar 25, 2014

Nice to see someone working at a central bank. Something I am thinking about myself as well. Why did you personally choose to work at a central bank? And why you choose to go for an internship in S&T? Does working at a central bank provides you with a good background to transfer to S&T / IB later on?
Hope you answer these questions, would be very helpful. Thanks in advance!

Mar 25, 2014

luckyluke, I chose to work at central banking because I wanted to move from Academia into banking, but didn't feel ready to embark Investment Banking. Also, realistically, I knew that my chances of getting S&T at top IB would be next to none. In addition, the hours are quite compatible with PhD studies.
I went for an internship at S&T because that's all I wanted to do since starting my Msc in Finance. The first thing I do when waking up is checking FT 6 am cut, so this opportunity is for me natural. Honestly, if you work in a markets-linked department at a Central Bank, the analytic work you will do will give you good skills plus a certain exposure to markets data (Ratings, Risk measures) to embark in an Internship. You will have to do lots of preparation and read everything you can to prepare for the interviews, but I guess you already know that. Feel free to pm me.

Mar 25, 2014

What does a central bank look for in potential employees?
What kind of people fit in in a central bank, culture wise?
How big of a disadvantage do finance students have over economics or econometrics students, if any?

Thanks!

Mar 26, 2014

Walkerr, I think, most of all, they look for contained and technically competent team members with a demonstrated interest in monetary policy or financial stability. It's very important that you dominate office politics. Also, there is no space for stardom here and the progression is not so much dependent on what you do as to the the vacancies that are opened.
The disadvantage of finance students is that they will not be ready to integrate the economics department at the beginning. However, they are significantly advantaged in markets or financial stability linked departments. Econometricians are highly regarded since their models are very much used in the forecasting of inflation expectations. Overall, I would say that central banking is something that can boost a lot your competences and get you ready for the eventual step to IB, if you find that this your place. Depending on the department, I would say that it's the closest that you get to private sector without being there in terms of competitiveness. I say this, because I work with lots of colleagues who migrated from IB after some years and they told me this. Depending on the central bank, the pay can actually be good with lots of benefits and special taxation regimes.

Mar 28, 2014
PSR666:

Depending on the department, I would say that it's the closest that you get to private sector without being there in terms of competitiveness. .

Could you please specify this; what do you mean by competitiveness (as you said it's important to dominate office politics)?

Also, you said people migrated from IB from central banks. Where do central bank employees go after their stint with a central bank?

Thanks again.

Mar 25, 2014

Hi! actually i want to ask you something about risk management because i kind of want to pursue a career there.
What does a usual day look like as a risk analyst?
What are the most important skills needed for a risk analyst?
I've heard that risk analysts should be proficient in at least one of R/SAS/SPSS. is that true?
thank you very much!

Mar 26, 2014

JosephSUN, I can tell you about Risk Management in a Central Bank. A usual day involves running assessments on the risks to which the institution is exposed and discussing models within the team you work, Usually this means evaluating prices, the volumes, and calculating the expected shortfall or Var. You need to work with big databases, so you need some programming skills like Matlab, Stata and Excel of course.You also need to draft reports for the management, so I would say that good drafting skills are also important. You need to be proficient in Stata or SAS but not in both. You need to understand what you are doing, so I guess a sense of the financial markets development is quite useful, specially when identifying anomalies. You can have prices for instruments that were actually traded, or just indicative prices, and so you need to understand how close to reality you are. If you have a quantitative background it is a very fulfilling role for someone that likes modelling but that also wants to be close to financial markets and understand them better.

Mar 27, 2014
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