A common thread we see on WSO from time to time is regarding working for banks in their regional offices.
As banks are leaning towards more cost cutting and squeezing every dollar they can from their operations, a popular tactic has been to expand existing business and move current business to offices outside of the large financial hubs like New York, London, and Tokyo. Originally satellite offices primarily consisted of operations and technology as well as PWM offices that serve local clients, however, in the last few years we have witnessed that regional offices of the majority of BB banks have been expanding parts of FO teams that do not have frequent face to face client interaction.
PROS
- cost of living This is the biggest benefit. Although at a regional office your base salary might be around 80% of what it is in a hub, the cost of living is so comparatively low that in reality your savings rate can be above 300% of what it is in a hub, especially if you are someone that likes to go out to bars/clubs on a regular basis.
- quality of life Up for debate as different people can have a different perspective on what is qualitybut in a regional office city you can usually live in a very nice place in a neighborhood of your choice as commuting is usually much easier. In NYC, for example, you are relegated to living in what most would consider a closet, most likely in a neighborhood that is convenient for the work commute (unless you are one of those that doesn’t mind the 2 hour train ride from Trenton every day.)
CONS
- networking Unfortunately one of the biggest cons is the most important thing to your career. Nothing beats the ability to meet and network with finance professionals in a hub city. Hubs have such ease of access to events, get-togethers, and just the ability to reach out to someone who works in a specific group at a specific company that you might be interested in that will never be matched by any regional city.
- exposure to senior management
Unless you work for a PWM group where your head MD is the rainmaker and your goal is to stay with that team for the long-term, working in a regional office provides a very limited potential for exposure and interaction with group/division heads and might limit your lateral movement within the company. As you do not get this exposure, you might be overlooked for a position that could possibly be a good fit for you.
If you have a source of wealth due to whatever circumstances as you are entering the workforce, the cost of living point does not apply to you so it might be a no brainer for you to head straight to a hub. But if you are coming out of college with a mountain of debt and minimal to no outside financial support it might make more sense to start out at a regional office if given the opportunity.
I think that during the analyst years it would be advantageous to pay off your student loans, establish a base of cash savings, and go through at least two pay raise cycles before moving on to a hub city. That way when you do move you are on stable financial ground. As most of us do want to attend MBA programs at some point, I do not believe that whether you work in London or in Virginia matters much to admissions counselors. If anything it might even help you as most candidates are from NY/London and the adcoms might want to seek diversity.
Of course what I write here does not apply for everyone, but it is certainly something to consider when weighing your offers this year.
How are Chicago regional offices usually thought of? I go to a midwest target (think UC, NU), and should I work my ass off to get to NY, or will staying in Chicago give me as much chance considering Chicago is also a semi-financial hub
I have been thinking of Chicago/Texas lately. There is no way I am living NYC forever- I like driving, refuse to live in apartment indefinitely, and still get sticker shock when I walk out the door.
California used to be my target, but not with the fiscal situation there. A proposed 13.3% top income tax? And still running a deficit? No thanks- not sure what a default will do to financial services there, but I don't want to find out first hand.
For my BB, when they consider cost cutting this year (which there were several rounds), the regional office people always get let go first. Most group heads sit in NY so if you are in NY you are much closer to the group head who might look out for you more than regional counterparts.
For people in our group who is being let go, the group head actually tries to find him a spot in other groups in NY, but for the regionals.... they are less lucky....
Something you might want to consider when you think about cost-cutting... Don't necessary think they cut NY and expand out to regional
Does anyone have any idea what it's like working in a DC office? Are the base salaries there typically still 80% lower, despite the high cost of living?
If you're at a BB your salary is 100% what it would be in NYC. In real terms it's likely much higher.
Unfortunately this is not exactly true.
I don't think this is true either for the majority of cases, however, an example that I have heard of is that when a person gets "volunteered" to go to a regional office from a hub, they keep their hub salary (it does not get adjusted down to regional office cost of living level), but this is kept track of by HR and at year end if they would have normally been due a raise, they would be kept at the same salary money wise to adjust them back to the regional cost of living.
Base is exactly the same and bonus tiers are the same as long as you perform, how do you figure it's different?
but NYC is so presteejus!!
I think you need to divide regional into two groups. Tech or media in Cali or energy in Houston is in no way inferior to NY when it comes to comp or connection to group heads. Other regional offices may not be the same, but they also don't serve an industry-specific purpose.
Good point. I mentioned this in the way of the PWM example, but completely agree that certain industry groups are specific to certain cities outside the traditional hubs. thx
Boston is big for mutual funds and is a strong location for salespeople after NYC of course
San Francisco is pretty much just as expensive as NY. Do they still have cost of living adjustments there? (Outside of tech/media).
work in a regional and can second jeff skilling
Not sure about IBD, but for MBB all analysts get the same offer - regardless of whether they're in NYC, Chicago, or Cleveland. I know guys from the Cleveland / Detroit / Pittsburgh offices that are cleaning up compared to me - downside is they live in Cleveland / Detroit / Pittsburgh.
Anyone have info about Chicago? Specifically BB/HF/PE with a significant presence in the City. I know MS and GS have a good presence, what about other firms. Specifically focused on securities, dont really care about the commercial banking side. For replies, can you please state what LOBs for Front Office, or if its for BO only.
third for jeff skilling, with specific regards to BB IBD. neither salaries nor bonuses are affected based on location within US, although i don't know about internationally.
I hope I never have to work in New York City or anywhere else north of the mason-dixie for that matter.
BB regional offices - what do they do? (Originally Posted: 11/16/2009)
Hey guys, I'm wondering..what do people at regional offices (for example....Seattle) do? Are they mainly relationship-management or do they do deals too? Also, should I contact those offices directly if I want to intern there over the summer?
sometimes an industry focus. ie houston - energy group; menlo park/sf - tech/healthcare; LA - media & comm; etc etc. sometimes smaller MM deals by region
What about Chicago?
Depends on the office and firm. Some firms (such as GS) have full execution capabilities at their major regional offices (SF/LA/CHI), and arguably these regional offices may have better exit ops for certain careers (such as West Coast VC/PE) than NY.
Other regional offices have more of a satellite relationship with NY. Generally, the smaller the office (and the fewer senior bankers they have), the more pitching/sourcing and less execution.
Chicago does normal regional work for regional relationships as well as usually doing Automotive, Industrial and Chemicals. Generally Chicago offices will have full capabilities in certain areas and be satellite pitching factories in other groups. Note that this is for BBs not MM firms.
A number of MM firms have headquarters in Chicago, and therefore do everything.
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