Commercial Banking vs Investment Banking
Ladies & Gentlemen,
do you understand why are we so crazy about IB? Why don't we dream about goin' to Commercial Banking? Maybe we're just impressed with all this IB stuff, like: good suites, white shirts, nice collar buttons, English shoes, damodaran books... (anything else?). Or maybe its about the money? If so, why do we think we will get much more in IB?
Let's compare.
An average IB analyst makes appr. 70K per year + 20-40K bonus. Let's take upside: 110K per year. But he works about 70-80 hours per week, so 110000/(80*4*12)= $28,65 per hour.
One of my friends works in a commercial bank as a credit analyst for large corporates and gets 36K per year + 25K bonus (even now!!), but his working day finishes at 6pm and he goes home, so he works 40 hours per week. Thus, he gets 61000/40*4*12=$31,77 per hour.
So why are we so crazy about IB? Why can't we invest our time more wisely?
commercial vs investment banking
While the OP's post originally centered around the per hour salary of IB vs. commercial banking, our users shared an explanation of why they favored investment banking over commercial banking that may pay more per hour.
Why are you only comparing entry-level positions?We do it for post-entry-level opportunities, and because the work is more interesting than credit analysis. Not to say that excel modeling is interesting, but the determinants and expectations for your client's M&A deal certainly are more interesting than Wal-Marts new credit line with your bank.
Plus, to criticize your comparison further, past entry level, our salaries shoot way up relative to com-banking. Our exit opportunities have even higher relative salaries, and are even more interesting.
Interned at a good commercial bank & Barcap I would say both analysts/associates work equally as hard, just the commercial bankers quit at 6 like you said. I liked commercial banking because the teams where much more relaxed for the above mentioned reasons, everyone in SF with Barcap where much better educated and 10x more intense & sometimes harder to get a long with. But I learned at Barcap & at the CB bs'd all my underwriting assignments & got recognized for it. CM is EXTREMELY monotonous, it only really gets "intense' if you work on distressed loans; I think sitting through a loan committee was the most boring thing I've ever done.
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