Banks that “favor their own” vs. banks that “prefer outsiders”
I am currently at a BB that will easily pass over top-tier external candidates in the interest of promoting an “insider,” or even granting their request to switch divisions internally (I.e. from research to IB).
I have a friend at an MM whose bank does the opposite, and who complains to me that his bank will credit a new hire with two years of experience at a “better bank” with 4+ years of “experience” as far as their incoming rank is concerned.
I suppose it is a trade-off between obtaining labour as inexpensively as possible (internal promotion/switches) vs. acquiring prestige “inorganically” (poaching).
Would you say that your bank does more of the former, or more of the latter?
This is very common at JPM and MS, less so GS but still exists there. Feels like every other bank is the MM bank your friend described.
Don't think EBs like CVP are like that. I know they hire a lot of external MDs but that's because they're growing rapidly and don't have enough internals to promote.
Makes sense. I suppose that “we have a team that was trained at GS” has more value to bank leadership than “it is cheaper to retain than hire?”
This and "I can have a candid discussion with their manager who will (hopefully) tell me if this person sucks" versus externally you're always taking a bit of a risk with people who interview well but are't actually good
Also curious which BBs are best at internal mobility
bofa 100%
Citi
Have experienced the absolute opposite.
UBS prefers Barclays
Almost every bank except MS, GS, and JPM favors outsiders. EBs are super egregious at this, as the whole business model is leaner, deal teams mean rainmakers from full-service banks move over for higher pay. The biggest example, however, is Jefferies: they essentially never promote internally as a business choice. Pros and cons of both strategies and the MS/GS/JPM approach only really works because they have such a strong brand name.
Makes sense. I feel like at a bank that doesn’t promote from within, the incentives for analysts/associates are kind of strange. They generally allow for A2A … but you know that you have a ceiling there.
Only group that’s an exception at Jefferies is the Energy team.
They have almost never hired at the senior level externally(outside of when they have had to establish a practice- such as when the original midstream team joined or more recently the ET team)
makes sense and looks like it's worked --- they're one of the top energy groups aren't they
Wouldn't say EBs are egregious at this. Yes they hire externals but they're growing multiples of what GS/MS/JPM are so they need to to sustain that growth .
E.g. in last decade Evercore went from 0.7bn to 2.4bn and PJT 0.3bn to 1.3bn in annual advisory fees whilst MS went from 1.6bn to 2.3bn. It's going to require some external hiring to grow at that rate as you can't produce enough internal talent
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