Commercial Banking or Corporate Banking?

Assume you don't want to be an investment banking hardo working 110 hours per week EVER.

If you had to choose between a career in commercial banking or a career in corporate banking, which would you choose and why? 

Commercial Banking: 

  • Pay starts at 80K All-In out of Undergrad
  • Pay hits ceiling around 150K All-In as a Team/District Manager/AVP by Year 8
  • Work-Life Balance means you have time for relationships, startup, 4 weeks paid vacation, benefits you can actually use. 
  • No compliance monitoring for trading/investing 
  • Immediate and frequent client interaction, leading the dialogue with CEOs/CFOs of MM companies. 
  • Can always move into corporate banking after like 6-8 years in commercial

Corporate Banking: 

  • Pay starts at 100K All-In out of Undergrad
  • Pay hits ceiling around $250K All-In as a VP by Year 7 (Who knows how long it takes to make MD and what the pay is like?)
  • Work-Life Balance is less than commercial banking.. but you're out by 7-8 pm most days and rarely ever work full weekend days. 
  • Can only trade/invest in mutual funds and real estate.
  • No client interaction aside from listening to dial-in pitches until VP+ in Year 7.
  • More interesting work and financial analysis (arguably) because of larger companies 
  • Better Exit Opps? (Maybe?)

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Comments (46)

  • Associate 3 in IB - CB
Apr 7, 2021 - 5:26pm

Have been in both and can say commercial leaves you so much more satisfied. Interactions mean something vs just adding trade lines and products in a system which happens at corp side. Really depends on what is valued but wl balance is so much better you can plan trips and have down time much easier. You see a lot more movement to RM role at commercial shops and on corp side much less fluid

  • Associate 1 in CB
Apr 7, 2021 - 6:13pm

Have been in both and can say commercial leaves you so much more satisfied. Interactions mean something vs just adding trade lines and products in a system which happens at corp side. Really depends on what is valued but wl balance is so much better you can plan trips and have down time much easier. You see a lot more movement to RM role at commercial shops and on corp side much less fluid

Are you based in Canada or the US?

Why is it much less fluid to become an RM on the corp side? I thought Directors were basically RMs? 

Is it really hard to plan trips and vacation in corp banking?

  • Associate 3 in IB - CB
Apr 8, 2021 - 5:57pm

US. Depends but when you do corp banking under IB umbrella IB side basically owns relationships. So you just do memos and not serve as client touchpoint usually. At commercial there are more opportunities to become PM or RM with client interactions as job. Can vary by bank but becoming client facing at larger banks is harder on credit path

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Apr 8, 2021 - 12:56am

Will be an intern this summer in CB, at least at the bank im at the starting take home all in for commercial banking is 60k and Corporate banking is 110ish. From what I have heard from people that Ive chatted with at least within my bank is that private credit exits are probably the most likely. I don't believe the transition would be easy coming from commercial banking

  • Associate 1 in CB
Apr 8, 2021 - 9:41am

Callmetac

Will be an intern this summer in CB, at least at the bank im at the starting take home all in for commercial banking is 60k and Corporate banking is 110ish. From what I have heard from people that Ive chatted with at least within my bank is that private credit exits are probably the most likely. I don't believe the transition would be easy coming from commercial banking

Private Credit exits from corporate banking? Doesn't sound that realistic I thought they usually only hire IB at the larger credit funds.

  • Associate 1 in CorpFin
Apr 8, 2021 - 4:39pm

I did not work in private placements but have worked in both commercial and corporate banking. I think corporate banking is a no-brainer over commercial banking.

I would say: Private Placement > Corporate Banking > Commerical Banking. 

  • Associate 1 in CB
Apr 8, 2021 - 8:28pm

I did not work in private placements but have worked in both commercial and corporate banking. I think corporate banking is a no-brainer over commercial banking.

I would say: Private Placement > Corporate Banking > Commerical Banking. 

In terms of what's best for exit opps into private debt? Or are you answering OP about which career path is best?

Apr 8, 2021 - 8:28pm

I've worked in commercial banking and would also recommend corporate banking. corporate banking pays more, the clients are more complex and sophisticated and while the exit opportunities aren't great they're certainly better than commercial banking.

  • Analyst 2 in IB - CB
Jul 19, 2021 - 10:33pm

Hey man. Would you mind sharing which BB you are at? Currently in IB and getting crushed but don't know which CB group would be best for me

  • Analyst 2 in IB - Ind
Apr 9, 2021 - 12:41am

I was in corporate banking before my IB gig. You got the pay scales off. My CB A1 pay was about $115 and my A2 was about $130. Commercial at $80 is pretty high for most places. Would be more like $65-70 at most places (around $5 of that being bonus). My hours were similar to the poster above. Was offline around 7/8 most days with no weekend work most of the time. Pretty great pay for the hours and the timelines / work was less stressful. Timelines for work are more drawn out so no one is breathing down your neck for deliverables. Would take corporate over commercial every day the extra pay is well worth it especially as that pay gap gets bigger as you get promoted

  • Associate 1 in CB
Apr 9, 2021 - 10:38am

I was in corporate banking before my IB gig. You got the pay scales off. My CB A1 pay was about $115 and my A2 was about $130. Commercial at $80 is pretty high for most places. Would be more like $65-70 at most places (around $5 of that being bonus). My hours were similar to the poster above. Was offline around 7/8 most days with no weekend work most of the time. Pretty great pay for the hours and the timelines / work was less stressful. Timelines for work are more drawn out so no one is breathing down your neck for deliverables. Would take corporate over commercial every day the extra pay is well worth it especially as that pay gap gets bigger as you get promoted

Just curious are you based in Canada or the US? 130 Seems so high for Analyst 1 in Corp Banking..

Apr 9, 2021 - 4:56pm

Mind commenting more on your switch to IB - are you happy you made the move? Things like what the transition was like, both in terms of getting interviews as well as ramping up into your IB role. Considering making a similar switch.

Most Helpful
  • Analyst 2 in IB - Ind
Apr 9, 2021 - 7:31pm

Overall I'm pretty happy with the jump to IB. If you're someone that really values work life balance though I wouldn't do it. Big difference between getting off at 7/8pm compared to 12-2am on average. I enjoy the work much more and find it much more engaging and interesting. Churning out bond and credit facility refis can get pretty mundane after awhile (at least for me). Also I think gives me more optionality in terms of exits if or when I leave banking. The ramping up / learning curve was not bad for me. Most of the work is very similar. Financial analysis and formatting PowerPoints after you've been doing it for awhile is all the same (I had a little over 2 years in CB when I made the jump). In terms of interviews, you do have to fight against the stereotype / notion that a lot of investment bankers have that in CB you're not doing much financial analysis or similar things to IB. I was always surprised actually with how many bankers really don't know what corporate bankers did. So be prepared to answer what you're doing day to day, your modeling / financial analysis experience, etc. You'll also be questioned about whether you're ready for the hours (obviously just answer saying you know what you're getting into and it's what you really want to do and the deal experience you want to get blah blah blah). The biggest thing that hold me back from getting offers on super days was just the fact I hadn't worked on any sellside deals which there's not really anything you can do about lol. I was over 2 years of experience in CB so was at a bit of tweener stage where in lots of group eyes I was too experienced to come in as an A1 and reset so they thought I should recruit for a experienced lateral spot and when I interviewed for lateral spots I was competing against people that could speak to sellside experience so even when I thought I killed the super day if the bank has two equally good candidates and one is already in IB and one is in CB then they'll just go with the IB candidate so that can make things more difficult. Some groups did recommend I recruit for an A1 spot though and I actually got a BB tech offer to come in as an A1 but turned it down for a MM bank that was letting me come in as an A2 and was in a city I preferred. Every group or even every person within groups will have different opinions on what experience level you should recruit for. My suggestion would to just be flexible and communicate that you really want to make a switch and that if a setback is what happens to your analyst years then that's fine and that a 1/2 year setback is not important to you especially over a long career and you really are more focused on building a different skill set / deal experience and continue to learn as a junior banker. I would come in with the mindset that you're most likely going to be spend like 3-4.5 years as analyst with making a switch externally (I knew people that did it internally at my bank and they still always took a 1 year setback in analyst years). Hope that advice helps

  • Analyst 1 in IB - CB
Apr 9, 2021 - 8:27pm

Go for Corporate Banking. As someone whose worked in corporate and commercial banking at a commercial bank, its much easier to go from corporate to commercial if you wish to. On the corp side, you'll see more interesting credit profiles and interesting transactions. Commercial banking gets boring af and products/transactions are very simple. Yes, the work-life balance is definitely better on the commercial side but corp hours aren't anything like IB (with the exception of last year being pretty brutal for a lot of FO roles). Pay is obviously a plus on the corporate side too.

Apr 12, 2021 - 2:19am

Associate 1 in CB

Assume you don't want to be an investment banking hardo working 110 hours per week EVER.

If you had to choose between a career in commercial banking or a career in corporate banking, which would you choose and why? 

Commercial Banking: 

  • Pay starts at 80K All-In out of Undergrad
  • Pay hits ceiling around 150K All-In as a Team/District Manager/AVP by Year 8
  • Work-Life Balance means you have time for relationships, startup, 4 weeks paid vacation, benefits you can actually use. 
  • No compliance monitoring for trading/investing 
  • Immediate and frequent client interaction, leading the dialogue with CEOs/CFOs of MM companies. 
  • Can always move into corporate banking after like 6-8 years in commercial

Corporate Banking: 

  • Pay starts at 100K All-In out of Undergrad
  • Pay hits ceiling around $250K All-In as a VP by Year 7 (Who knows how long it takes to make MD and what the pay is like?)
  • Work-Life Balance is less than commercial banking.. but you're out by 7-8 pm most days and rarely ever work full weekend days. 
  • Can only trade/invest in mutual funds and real estate.
  • No client interaction aside from listening to dial-in pitches until VP+ in Year 7.
  • More interesting work and financial analysis (arguably) because of larger companies 
  • Better Exit Opps? (Maybe?)

I worked in commercial, corp banking, and IBD and have a lot of buddies in these circles as well 

Starting out I'd highly recommend corporate, you gain a skill set similar to IBD but work less hours and take a bit of a pay cut relative to IB. There are always trade offs, I've highlighted a few I have come across below 

Pros for corporate banking 

- Corp banking covers larger clients and gives you a well rounded experience (public clients / capital markets) - you'll learn to look at companies across the capital stack. Commercial banking clients are smaller and may be less complex 

- Coming up in Corp banking my path was similar those that came up in IBD: coming up the analyst - assoc - VP hierarchy, this helps you navigating  a matrix reporting environment 

- Breadth and depth of analysis in Corp banking is greater - modeling, companies have more complex capital structure, M&A (obviously have this on commercial side too), takeprivates, etc. 

- Salaries,  comp, and promotions are typically programmatic unlike commercial which is all  over the place

- Better pay but longer hours 

Pros for commercial banking 

- Less structured so if you're good you can potentially get promoted  more quickly 

- Client interaction earlier on: since they're a lot of layers in Corp banking while CB is a flatter structure, you can get client interaction more quickly 

- Better client access: in Corp banking depending on size of client the point of contact may be a Treasurer, Head of Capital Markets, or CFO. In commercial given smaller clients and flagged org structure it may be CEO/CFO/owner-founder, all depends on client 

- Better work life a balance and faster promotion to senior banker 

If you are not sure what you want to do, Corp banking (especially at a BB) gives you better technical skills, more resume power, and sets you up to lateral. 

Comp can be all over the place. Some BBS have same base for Corp banking as IBD but lower bonus. You should definitely be able to clear 300-400k all-in (base, cash bonus, stock) at the VP or Director level depending on the shop. Other shops base can be a discount to IB
 

it's easier to move from Corp banking to CB than it is to move from up from CB - hours worked and the hard skill you learn are not the same - all shops are different so this is more of a generality than the rule 

Apr 25, 2021 - 9:17am

Can't speak to Corp Banking but I have basically been in commercial my whole career. One thing I should point out is that there are two main career paths in Commercial - Sales side (RM) and Credit Side (analyst/eventually a PM) - for the RM role, pay can be significant. For the Credit/PM route, you'll probably top out around $150K within 10-15 years of your career(midwest figures) - if you get really high up in Credit, you can probably push closer to ~$200K. For reference, top RMs can pull $300K+.

Here's comp progression for me (Midwest) - most of the other figures in this thread seem to be NYC/other HCOL based but maybe not.

  1. Analyst1 -   < $100Bn assets Regional Bank in Midwest: ~$50k. -- this role was a joke. There were some weeks that I literally had 0 work to do because it was all participations in large syndicated deals where the lead bank hands you the deal on a silver platter.
  2. Associate1 - $100Bn-$200Bn assets Regional Bank in Midwest: ~$72K all-in - this role was easy. Was focused on smaller clients than my Analyst role at the bank above. 
  3. Associate2 - same bank as #2. ~$80K all-in, primarily due to a good bonus - excluding the abnormal bonus, closer to ~$76K all-in. 
  4. Associate3 - same bank. ~$80K all-in, but bonus wasn't as big (salary went up)
  5. Senior Associate - ~$105K all-in. Big salary bump, bonus wasn't too much different. I'm 5-6 years into my career at this point. 

This is all on the Credit side i.e., not the sales side. My job is easy, I never work more than 40 hours a week usually, never any weekend work, and basically I own my schedule as long as the work gets done.

I personally wouldn't take the extra money to work that extra 10-15 hours a week - it doesn't sound like a lot, but that's enough time to get a solid workout in and cook dinner each day and still have that 1-2hours to relax and get 8 hours of sleep. Mind you, my wife also makes decent money (~$60-70K and she's due for a promo), so soon we'll be sitting together at ~$175K all in, which where we live for our age is a lotttttt of money. 

  • Associate 1 in CB
Apr 26, 2021 - 10:02pm

BBDreamin

Can't speak to Corp Banking but I have basically been in commercial my whole career. One thing I should point out is that there are two main career paths in Commercial - Sales side (RM) and Credit Side (analyst/eventually a PM) - for the RM role, pay can be significant. For the Credit/PM route, you'll probably top out around $150K within 10-15 years of your career(midwest figures) - if you get really high up in Credit, you can probably push closer to ~$200K. For reference, top RMs can pull $300K+.

Here's comp progression for me (Midwest) - most of the other figures in this thread seem to be NYC/other HCOL based but maybe not.

  1. Analyst1 -   < $100Bn assets Regional Bank in Midwest: ~$50k. -- this role was a joke. There were some weeks that I literally had 0 work to do because it was all participations in large syndicated deals where the lead bank hands you the deal on a silver platter.
  2. Associate1 - $100Bn-$200Bn assets Regional Bank in Midwest: ~$72K all-in - this role was easy. Was focused on smaller clients than my Analyst role at the bank above. 
  3. Associate2 - same bank as #2. ~$80K all-in, primarily due to a good bonus - excluding the abnormal bonus, closer to ~$76K all-in. 
  4. Associate3 - same bank. ~$80K all-in, but bonus wasn't as big (salary went up)
  5. Senior Associate - ~$105K all-in. Big salary bump, bonus wasn't too much different. I'm 5-6 years into my career at this point. 

This is all on the Credit side i.e., not the sales side. My job is easy, I never work more than 40 hours a week usually, never any weekend work, and basically I own my schedule as long as the work gets done.

I personally wouldn't take the extra money to work that extra 10-15 hours a week - it doesn't sound like a lot, but that's enough time to get a solid workout in and cook dinner each day and still have that 1-2hours to relax and get 8 hours of sleep. Mind you, my wife also makes decent money (~$60-70K and she's due for a promo), so soon we'll be sitting together at ~$175K all in, which where we live for our age is a lotttttt of money. 

Okay are you being serious right now about 200K-300K? 

Canadians: Is it possible to earn this much money in commercial banking?

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