AI + IB = FUCKED
Recently signed SA27 at top BB and over the past couple days have been increasingly concerned with the adoption and utility of AI in white color environments, and particularly banking.
There are obviously so many unknowns here. But as I see it, there are a couple ways things play out for Wall Street. All cases assume AI adoption continues up and to the right.
Bull Case:
10-15% (somewhat arbitrary) reduction in entry level IB jobs. AI allows Analysts and mid level bankers to be more efficient, which means more deals closed and bigger bonuses.
The parallel here is something like the commercialization of the calculator and/or Excel. It reduced the need for Analysts slightly, but the net effect was increased efficiency and profits. That said, I understand AI is more revolutionary than a 4 function calculator.
Bear Case:
40-50% (also arbitrary) reduction in entry level IB jobs. Extremely low return offer rates for SA during this transition period as well. AI replaces most of the grunt analyst work. Banking becomes less about crunching numbers and putting decks together, and more strategy oriented. This will also increase profits and bonuses for those that can break/stay in the industry.
Would be interested to hear thoughts from those more knowledgeable in the industry. I assume there is an in between “base case” here as well. Wishing all of us best of luck.
Based on the most insightful WSO discussions, here's how AI might impact Investment Banking (IB) roles:
Bull Case:
AI adoption could lead to a 10-15% reduction in entry-level IB jobs, as automation enhances efficiency. Analysts and mid-level bankers would benefit from tools that streamline tasks like financial modeling, data analysis, and presentation creation. This parallels the introduction of Excel, which reduced manual work but ultimately increased productivity and deal flow. The result? Higher profits and bonuses for those in the industry, as AI enables bankers to focus on higher-value, strategic tasks.
Bear Case:
In a more disruptive scenario, AI could replace 40-50% of entry-level roles, automating much of the "grunt work" traditionally done by analysts. Tasks like building pitch decks, running basic models, and data gathering could be handled by AI, shifting the focus of banking to strategy and client relationships. This would make entry into the industry more competitive, with lower return offer rates for summer analysts during the transition. However, those who adapt and remain in the industry could see increased compensation due to higher efficiency and profitability.
Base Case:
The reality likely lies somewhere in between. AI will undoubtedly reshape workflows, but the operational quality and complexity of IB work will slow full automation. While some tasks will be displaced, others—like strategic decision-making, client management, and nuanced deal structuring—will remain human-driven. Analysts may find themselves working on higher-value projects as AI takes over repetitive tasks, potentially leading to a reallocation of responsibilities rather than outright job elimination.
Key Takeaways:
The best advice? Stay ahead of the curve by learning how to integrate AI into your workflow while honing skills that AI can't replicate, like relationship-building and strategic thinking.
Sources: Work at top AM -- AI will virtually kill of entry-level roles in AM over the next 5yrs, Work at top AM -- AI will virtually kill of entry-level roles in AM over the next 5yrs
Bump
Bump
After culling 15% of people, the prior mid-bucket analyst will become the bottom-bucket analyst ( simply because the people below them are gone ) and they will be stuck in anxiety and fear for the next culling. And their bonus will be bottom-bucket bonus ( kinda unfair because they're mid-bucket quality. )
the best job in the future are athletes and singer. Ai will never replace these -- especially singer, I saw a song-generating AI in a lab -- it is very awful. Singers are safe for the next century, so are the athletes.
But if you are really good at the banking job ( being top-bucket all time ) and get fast promo and make it to MD, you'll be forever safe from AI and also will make great wealth from the profit-boosting AI deals. You just need to get there fast
“Walk My Walk" by the virtual artist Breaking Rust topped the Billboard Country Digital Song Sales chart in Nov 2025.
Need to tick and tie facts here…
Will you guys still be posting this doom slop in 2031 when the IB junior class sizes are exactly the same?
Maybe try addressing the points
Associate / VPs at my bank and my friends banks are saying that they expect 50% of the 2027 SAs to not be given return offers due to AI
I rly hope this is bait
Unfortunately not. Would just stay close with everyone you spoke with during recruiting. It’ll come down to whether or not you have people fighting for you at the end of the summer
is claude planting bots to make these fearmongering posts
Nah I’m just a concerned sophomore lol. Worked my ass off to land this offer, not tryna lose my RO to a bot
I can see it.
If you live in tech circles you would know anthropic are the kings of virtue signaling and marketing. Kudos to them. Haven't seen anyone/thing get so many buffoons to believe propaganda since h*tler
Seriously AI is going to increase the need for analyst jobs, not excel. People are totally missing the point about what junior bankers do. Plus as I said on the other thread, analyst and associates costs are negligible and Claude can’t carry my pitchbooks to a meeting
I kind of agree with you. I’ve noticed one senior people in my company (and not just finance, this happens at my friends’ tech and consulting companies too) just like to feel powerful having junior employees under them fetch them water/coffee and verbally abuse and take out their anger on at midnight on a Friday. I don’t think AI is going to replace people’s need for an outlet to take their miserable life out on. I think my boss gets off to having someone at their beck and call to do pointless things like walk them through a model at 2 am because they want to feel powerful.
Ok but if this is the sole reason analysts will still be needed, that could still mean massive reductions in analyst class sizes. You can still get that power trip off 5 analysts instead of 15
Everyone saying there'll be no juniors any more - you really think VPs want to be spending their lives prompting AI to do something that they can't necessarily rely on? What happens if what the AI does is wrong - you really think the mid-levels are going to want to go back to the analyst grind redoing the work?
While AI is certainly developing rapidly, I think many of you are under estimating how slow moving large institutions (such as BBs) are to move. I don’t think it will materially impact headcount’s in IB for atleast 4-5 years
you're forgetting greed and EPS incentives. If one firm is able to implement AI successfully and run circles around everyone then every firm will
People are delusional here. AI will 100% be cutting junior talent materially in the next 5 years. It won’t be 50%, but it will be 10-20% which will tighten the opportunity pool significantly.
Every IB is racing right now to get as much AI integration as possible. It already significantly impacts my workload but handling a ton of tasks for me. There are multiple industry folks on the record saying the human labor needs will reduce; I would believe them.
At a premium now will be smarter juniors who can actually understand the why, communicate well with clients, and interact with AI in an intelligent and efficient way. Either prepare for this reality or good luck with your job hunts.
Juniors are not cheap talent anymore. The days of paying a 23 year old $150k to push bullshit all day is over. Now they will want thoughtful, smart people who can tailor the outputs, not just crank long hours with strict orders on what to do.
To an extent that’s what banking used to be before the analysis paralysis that set in. Smart, well paid juniors that could really think critically. Right now there are too many analysts processing money work.
But I don’t agree that this is what will happen. AI will just increase the pace of work. It used to take a month to draft an S-1, now a week. There will be more deals as a result. Companies and sponsors will want more and faster. It’s a shame because I need some rest.
2 words. Prompt engineer.
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