IB at age 40 from Credit Risk
I am a VP in middle market Credit Risk (portfolio management and underwriting) at one of the top 3 banks in the nation. Comp has stagnated and does not seem as it will ever go beyond $400K all in at my manager (or his manager) level. Am I delusional to consider an analyst role in IB at this age or to even think they would consider me? I have an MBA from a university that has name recognition and have been in this industry for 10 years. I think I could downgrade my title and make a move internally, so getting in the door may not be as difficult but I am wondering what my career prospects will be. Does appearing younger in age help at all? I know these are trivial questions so excuse my ignorance here. My motivation really is the $ first and then my interest in the deals. Meaning, I would consider another route if IB is not possible if it paid close to what IB does. I do enjoy my work and work long hours already. I have done modeling for a long time and can structure complex deals and analyze complex financials as that is my daily job.
Any help, insight and experience is appreciated.
First of all, 400k and credit hours is a sweet deal. Can you really not be happy with 400k? Credit hours are sweet and get even sweeter the higher you go.
As far as switching, nothing is impossible, but it will be hard. Switching to an analyst level is just silly. You would come in as an associate 1 at worst.
But why not network internally and see if you can come in as a VP1 instead? You’re best bath would be towards a coverage middle market group.
I agree that going from VP to analyst at age 40 would be ridiculous but don't know if anything higher is possible in my situation.
Don't do it bro. I know the grass seems greener, it is absolutely not. Unless you're currently and want to continue working 90 hour weeks + all weekend + well into the wee hours of the night, with no time at all for family or friends, I really advise you not to go down that path. It's one thing for the younger guys who are going for 2 years to get to their goal elsewhere in finance, but I can't imagine leaving a well-paying decent finance job for IB.
I also don't think you will be considered for any real IB jobs of interest, even at analyst, unless you downgrade banks deep into the lowest LMM. It's just not a field you can get into this late in the game, and it's insane to take a 75% paycut to work double the hours.
If you're good at schmoozing, PWM is easier to break into and the guys who are good at it make a lot of money. Alternatively, maybe a credit job at a small debt-focused PE firm or distressed players? They might be interested in that credit modeling background.
Good insights there.
Analyst bonus is like 50-60% of base on average, more in a good year but less in a year like this one. Definitely not more than base at junior levels except at a very small handful of EBs
Also, you do make good money but you are basically working 2 full time jobs so the math per hour is abysmal. Starting IB as an analyst thinking you will do it for a career is not viable, the burnout rate is just insane. Debt fund is a good balance for you IMO
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Do you want to consider buyside? Depending on which shop you are, private debt is quite feasible (i'm across the atlantic; seen Assocs to VP lateral to buyside). For myself i was in credit risk as well but moved to a public credit buyside role, and got traction on both private / public sides
I have had others say they could use my skillset on the buy-side.
I think moving from credit risk to IB (or even ER) usually means you will need to take a title downgrade, going from VP to associate. But your pay is likely to be more anyway even at the associate level. Can VP in credit risk make 300-350K or more in total comp?
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I’m younger than you but I’m definitely beyond working junior banking hours.
haha! That says it all.
if 400k isnt good enough you could do 500-700K or so in corp banking if you join an origination heavy team and hit MD level.
Unless an MD for originators, that salary is not possible at a big bank in credit as an MD.
Yes I’m talking about doing originations heavy credit work out of CIB. They no doubt have something like that if this guy is working at a top 3 bank. Not many seats but not a lot of jobs pay 500k…
do you have a family (kids) ?
I do not.
why do you need more than 400k a year if you're single and have no kids? do you have substance abuse issues? sugar baby prices getting alittle too high?
you could literally retire in 5 years if you just stop spending $$ you dont need to spend
A2A at an EB.
Over the years I've seen many MBA associates who started in their late 30s. None of them could handle the hours. They all left after 1-2 years. It's way more taxing to your body than you might think. That said, you'll never know if you try right? So, go for it.
Interesting logic
Any idea on what they went into after leaving?
Was at an LMM bank when I started and we often hired VP’s with non-IB backgrounds. So you could try that if you don’t care about brand name and only money. I bet they would hire you at the VP level. LMM salaries are not crazy tho - maybe 300-350k for VPs and 500k-750k for MDs (can be higher in a great year but less in a bad one). Though VPs and MDs probably worked 60 hours max
Were the roles you listed with salaries in credit risk or origination/sales people?
You don't need advice from folks on WSO who are mostly if not entirely in their early 20s. You're already 40. It is now or never. If you don't try now you'll forever wonder what it would have been like. Life is short. Go for it.
Proceeds to give advice as intern on WSO
Been in the industry for 10+ years but never seen or heard of anyone in their late 30s/40s who could withstand the junior banking hours physically and mentally, and stayed in the industry. Most realistically you'd be breaking in as an associate. Think hard if you can really handle 90+ hour workweeks for the next 3-3.5 years at this point of your life with less than a week of vacation each year
What's the preferred exit op for someone tired of the hours who is still in a junior role?
We're in similar age brackets. If you're already a VP then you should already have a management-oriented resume, right? So why are you seeking an analyst role? You should be seeking some sort of management position. Maybe you can seek something out that would put you in charge of a mix of associates and analysts? There is always a need for talented managers across an org, even in IB. If you have solid management skills/ratings behind you then don't look for the downgrade, walk in as a manager to IB.
Managing analyst and associates without having put the time in as one, in their respective worlds (i.e. IB), is a tough sell.
$400k is a good ceiling. could just enjoy life instead of going to hell which is IB. in IB, if you're not brining business, you'll be asked to leave when you're making $400k. so you're trading a stable position for almost certain layoff in the future after several stressful years in which you'll work crazy hours while making about the same as you do now.
Is the expectation for the IB roles that pay $500k+ to bring in new business?
that's a salary of a VP. VP needs to bring business to the firm in order to get promoted to MD. if not promoted, then they're laid off - so called up or out system.
Banking sucks
Why not just start your own firm in credit risk and portfolio management or buy someones book of business. Theoretically unlimited compensation after a few years of grinding. Plus you wouldn’t have to deal with a step down in title.
Didn't know there are firms that manage credit as a service for lenders
Have seen an incredible Credit VP lateral to LevFin at the same BB and do well. Probably roles in teams like LevFin, DCM, Syndicate are relatively more natural for you than an industry coverage role, but anything is possible.
However what scares me about your story is "my motivation really is the $ first." This sounds like a huge mid-life crisis more than a considered career move.
You don't have kids/a wife and you're age 40, do you have any intentions of later raising a family? Because it will be more than challenging to date and settle down if you move to an Analyst/Associate role.
Are you sure that as a VP, your manager's manager (Credit MD) doesn't break $400k all-in comp? I understand the allure of the career reset but if you enjoy your work already then why not just continue on the career path? I'm not saying you don't have a good reason, but you'll need to prepare your rationale better beyond "want to do deals."
I don't know if it's MLC, but maybe it is. Not panicking but questioning which path to take going forward wanting to maximize earning potential.
Let me go ask...
I don't know why anyone in their right mind would make this move.
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