FIG at a BB London?
Hi guys,
Why does FIG have such a bad reputation? Why don’t people want to join it?
Are exit ops good?
Is it a pretigious group? How do you see its future?
Working hours?
I have an offer to join a FIG team at a BB and one other to join an industry group but in a slightly less prestigious BB. What should I do?
FIG at GS is top tier, that said if you want PE exits, few investments are made in FIG companies hence bad exits from non GS FIG teams.
Is the BB FIG MS/JPM/GS? Go for it, otherwise for the other BB except of its UBS/Deutsche.
PM for a more detailed answer
As a FIG banker in London, I believe this advice is highly misguided.
On the poor reputation of FIG, I believe there are 3 main reasons, where some are more valid than others:
1) FIG is boring - Coming from a degree where a very high % pursued IB careers, many people dreaded the prospect of landing in a FIG group for their intern placement. Understandably, banks/insurance/consumer finance are not the sexiest to many people, and the fact that the financial statements and valuation methods are quite different also makes it perceived to be quite difficult work. I can completely understand students' apprehension, but if you have an interest in FIG (e.g. because they are some of the most fundamental players of our capitalist system), you'll have a fun time in a FIG group. I personally like the challenge of more complex accounting and modeling, but this is also depends on your person.
2) FIG has poor exit opps - This is one of the most contentious points, and I believe the advice given here on WSO is often misguided or flat-out wrong. Maybe it is different in NYC where recruiting for PE is more structured than London, but i see PLENTY of people exiting FIG IBD to do PE. Recently, someone in my group (top BB) exited to Advent/CVC/Warburg Pincus level PE fund, my friend in another BB FIG team exited to similar level etc. And there are good reasons for it!
First, FIG requires quite intensive modeling, which as someone already has noted, leads FIG analysts to often crush the modeling tests. Now you say, "well you can't do an LBO of a bank/insurance company", and that is basically true. However, you will certainly in your time in a general FIG group be exposed to LBO models, as certain consumer finance and FinTech companies (which will often be dealt with by FIG bankers) are good LBO candidates.
Second, it is flat out untrue that few PE deals are made in the FIG/Fintech space. Yes, banks and insurance are rarer for non-specialised FIG PE-firms, but let me remind you of the biggest euro (global?) LBO of 2017, Hellman Friedmann taking over Danish payment provider Nets. Other notables last year include Nordic Capital backed Lindorff merging with Intrum Justitia, HF and GIC taking over Allfunds bank, BC Partners taking Shawbrook private (again!) and Cerberus taking over struggling HSH Nordbank. Indeed, many PE funds even state that financial services are one of the core industries in their investment strategy, and e.g. Apollo, CVC, HF, Bain and Advent have dedicated financial services teams.
So while it is true that sometimes recruiters (who don’t necessarily have the finger on the pulse) will market you exclusively as a FIG prospect, funds will also hire you for general investing in Europe.
3) FIG is hard work – Can only say that this is TRUE. FIG is the industry team that brings in the most revenue for virtually any bank on the street, which isn’t surprising given the high # of capital raisings that banks/insurance undertake. While the FIG group will therefore often have the most people, I’d say that the average hours in FIG are definitely some of the worst when looking at coverage teams.
Hopefully this gives you some clarity on the pros/cons of FIG, but do of course take it with a grain of salt, as I am necessarily a bit biased as a FIG banker myself. As for the FIG BB vs. other team in lower BB, I think you can only make that choice yourself. But to directly address the points about banks above:
GS FIG is DEFINITELY not the only team placing well – the “legendary” group really isn’t as legendary in London, and I personally know 2 people who turned down an offer there to elsewhere, as they really didn’t like the culture (some geographic teams have absolute sadistic slavedrivers at VP-level). I don’t see GS FIG on an outsized number of deals or PE exits, but of course they are a very good team (albeit not as legendary as random sophomores that parrot what they’ve read on WSO make them out to be – at least in London). Additionally, I wanna say that UBS aren’t as bad as people on WSO make them out to be, indeed their FIG team is one of the stronger in London (e.g. on Coop Bank restructuring, buy-side advisory on Ingenico/Bambora).
Sorry this got a little long, but hopefully other potentially FIG bankers can use this information down the line as well. Couldn’t resist countering what I believe is misguided advice above, it just repeats all the drivel you see on WSO.
Thanks
What are your thoughts on other BBs in London. Which ones do you see being strong in FIG and which ones are weaker?
Hey, I am the author of the post, unfortunately I forgot my password, sorry about that
first, a huge thanks to all of you guys for taking the time to answer my question and particularly to you MrOppenheim for such a structured and detailed answer!
As you seem very informed, could you rank the different FIG teams in London in your opinion?
Also, you talked about PE exit opps. Would it mean mostly joining the financial services team of a PE firm? and what about funds exit opps?
Last, is the turnover (analysts quitting) higher and/or faster than in other groups?
Thanks again for your insights guys :)
I heard some bad things about FIG too. Could anyone in FIG shed some light on it?
I have yet to start but can tell you the people that tend to complain about fig the most aren’t fig bankers. I see guys place well from lower BBs that are fig. In my group I know 4/6 2nd year analyst in the fig group placed well.
The pro is there is usually pretty solid deal experience and technical work. The issue is the deals/clients are different than normal EBITDA driven companies. Many of the head hunters put you in thebr title="financial institutions group">FIG bucket unless you really push them not to. You gain access to the FIG exits that your usual m&a banker will not have access to, but is slightly harder to switch industries. However, I’ve seen it a ton. With solid deal experience from a good bank and great networking anyone can make it happen. I would say there are some banks that FIG is a weak group and deal experience isn’t all that great, but if it is good you can certainly do well.
There is the always the “if you can model a bank you can model anything” which can hold true. I’ve seen some fig bankers crush those model test for non fig groups at great funds. In reality anyone can dominate those with practice and a solid understanding of what your doing.
Feel free to PM about fig, I studied the group and people at multiple groups before I ultimatly made the group decision at my bank
I could not agree more with FrankerZ. I am yet to start as well but there is one important thing: usually, people working in generalist teams are not able to work on fig modelling, but the reverse is possible.
Also, lots of PE firms focus only on FIG, hence they are incredibly likely to recruit someone who knows the industry very well.
What are the strongest BBs in FIG as far as you're aware?
I cannot provide a perfect answer but can say what I have learned from studying the industry the last few months.
Obviously GS is sort of legendary, JPM had a great year last year #1 in fees (pretty sure) MS Citi, and CS have great programs as well. I don’t know a ton about Barclays and UBS but know that it looks like both teams are really strong and like top ~7 from the tables I’ve seen. DBs team has split up and I RBC took like a huge chunk of their pretty powerful fig business (really strong like 2012-2017) in 2017. RBC has also made many hires this year from Citi and Baml to expand the insurance and Asset management business. They have done a ton of bank m&a and seem like a huge up and coming practice after the DB hires (group head was the top dog at dB). So that’s a decent program. Wells bank practice is mostly in Charlotte and insurance is mostly in nyc, the others are split in each city. I don’t know a ton about them BUT they just closed that massive (16bn) asset purchase for Credit S. They also seem a bit like RBC focusing a lot on growth maybe at a slightly aggressive pace.
I’m not sure about baml so I cannot comment on them, my thoughts is they are fantastic as well.
Also S O’neil Is a great fig boutique and KBW as well.
I think that covers most of them but really that’s just what I know. Not sure about how they stack up against each other. I do know that Gs just closed that cadeance deal and JPM had a killer year and RBC seems to be doing a killer job as well as investing a ton in the practice.
Hopefully that helps, that’s pretty much all I know.
GS, JPM, MS, UBS, Citi in London
sorry but fig models are easier than non fig Especially if u are talking about insurers
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