Front office/Middle office/Back office

Hey guys,

So we all know about the front office and what roles are typically contained there, however can any one give me a list of roles split up by middle office and back office (it doesn't matter if the role is split between offices).

Thanks in advance for any good responses!!

Comments (54)

 
4/14/16

Front office sells the products to clients.

Middle office does the ancillary items in support of the sale (i.e. reconciliation of records, compliance and controls)

Back office supports the underlying development of the product (i.e. budgeting, resource management, developing/maintaining systems)

"Loser terrorists" & "bad hombres"

"Typical candidates are those who attended a top-tier academic institution"
-Most job applications

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4/15/16

Thanks! Do you have a list of specific titles/descriptions of the jobs available in those offices?

 
4/15/16

I'm not sure why this got MS'd. If someone has a different perspective of be happy to hear it.

By 'product' I mean the physical good or service that is sold to a customer to generate income. Without the front office, the product doesn't get sold to the customer. In some businesses, the middle office is important in ensuring the correctness and sometimes the legality of the product/sale, especially in places like banks where the sale is, at often times, complex, involving many hoops from regulators, or special needs for individual clients. And the back office contributes by ensuring that resources are properly maintained or allocated to ensure smooth continuity.

"Loser terrorists" & "bad hombres"

"Typical candidates are those who attended a top-tier academic institution"
-Most job applications

 
4/15/16

Front Office: Investment Banking Analyst, Sales and Trading Analyst, Equity Research Analyst, Private Equity Analyst, Management Consultant, etc.
Middle Office: Risk Analyst, Compliance Officer, etc.
Back Office: IT&S, Accounting Analyst, etc.

 
4/15/16

Front Office: obvious what this is.
Back Office: anything that's not front office.
Middle Office: a term coined by a subset of back office to make themselves feel better.

 
4/15/16

This forum has a mentality of IB or bust, however, you are asking a good question as there is much more to finance than that. Front office is considered anything that is bringing in the revenue and interacts with clients. However, some front office jobs are no longer as appealing as they used to be. For example, I wouldn't recommend going into sales as there is no transfersable skill set and difficulty climbing up the ranks. On the other hand, something like equity research is considered middle office even though they interact with clients on a daily basis, while doing a bit of modelling and becoming experts in their fields. Very transferable skill set.
Don't let the peer pressure of these forums and your friends get to you and continue to research to find what's right for you.
Best "middle office" positions in my opinion are equity research and IB credit risk.
Not sure about the back office breakdown. Should be on the banks' websites; operations, treasury, etc.

 
4/15/16

Equity research is not MO. It's cut and dry FO

 
4/15/16

Agree. Research is absolutely FO. The content they create is monetizeable, they indirectly create trading revenue and their coverage is a selling point on IPOs. More importantly, the pay isn't BO and the skill set is directly transferable to a very obvious, revenue-generating role on the buyside.

 
4/16/16

I am aware of that. My point is that not a decade ago it was widely considered Mid office even though it's client facing. In relatively recent history has it become considered as FO. Even though their job didn't change. My point was that there is too much obsession over FO/MO as opposed to what you'll actually be doing and skills you'll pick up.

 
4/19/16

Thanks for the thoughtful response.

 
4/15/16

There is so much misguided discussion on this topic ranging from perceptions of prestige to downright wrong information. The fact is that front, middle, and back office are internal categorizations used for organization purposes by human resources. They don't necessarily signify prestige or importance within a company. Also, this categorization only applies to financial services firms. It's cringe-worthy when Certified Users on this site, who should know better, use these terms when talking about roles in companies outside of the finance industry.

The only correct comments on this thread are that front office is considered client facing and revenue generating and that middle office is a murky category that supports the front office. In general, front office jobs are held in higher regard and pay better. However, a number of revenue generating or strategic roles are not front office and compensate similarly or better. For example, strategy, corporate development, prop-treasury, principal investments, (some)investment strategy, and economist jobs are not front office. In fact - surprise - they are back office.

The big caveat to the thoughts that many of you are having after reading this is that these particular jobs are not easy to obtain. You can't transfer from trade support to corporate development. These roles are filled with people with relevant backgrounds relating to the individual roles. As a side note, you can't transfer from investment banking to prop-treasury either.

-guy who has seen actual banking org charts and worked in one of the mentioned groups

 
4/15/16

From what you said, you're implying that corporate development and strategy are revenue generating businesses. That is not true at all. You try to make money on that stuff without salesmanship and see where it gets you. Those two are nothing until it gets implemented in the front office where the folks capture the value add. Strategy is the base cost; salesmanship is always the value, whether it's a bank negotiated deal or an Armani branded suit.

"Loser terrorists" & "bad hombres"

"Typical candidates are those who attended a top-tier academic institution"
-Most job applications

 
4/16/16

Aww luv u 2 :-*

"Loser terrorists" & "bad hombres"

"Typical candidates are those who attended a top-tier academic institution"
-Most job applications

 
4/16/16
iBankedUp:

From what you said, you're implying that corporate development and strategy are revenue generating businesses. That is not true at all. You try to make money on that stuff without salesmanship and see where it gets you. Those two are nothing until it gets implemented in the front office where the folks capture the value add. Strategy is the base cost; salesmanship is always the value, whether it's a bank negotiated deal or an Armani branded suit.

Lol

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4/16/16

I definitely feel like OP had a legitimate (if very 'big') question basically about the internal organization of an investment bank.

I've seen a lot of org charts and I would say they tend to be helpful in understanding it to first order - I would google "investment bank structure/map" or similar and look at a few of them.

But on on a higher level, I'm sure someone has written up a detailed breakdown of the corporate structure of an investment bank, and perhaps details the individual roles and experiences that go into each. If not perhaps it would be a great idea for this forum to have a sheet of all the different major roles, descriptions of each, and where each fit into the bank.

It seems like something the site would have done long ago, especially because these terms are used so heavily on here and it's not always clear if people are referring to the same things or not.

 
4/19/16

Yes, I was trying to find out about the general organization of banking roles and departments. And thanks for the advice. I've looked up some previous org charts but it never specifies what the actual difference between FO and MO is. The difference b/w FO and BO is more obvious. It seems to me that any directly supporting role to FO such as risk managment would be considered "MO".

 
4/19/16

This perfectly underscores my first comment on this thread.

 
4/16/16

FO - revenue generating
MO - risk, treasury, depending who you talk to can be other support roles
BO - IT
depending on the firm and team, some MO roles have more respect than others. many pple work in MO who are more than capable of working FO but choose to for the fewer hrs/less stress etc. I say this as someone who has worked in both FO and MO.

 
 
4/17/16
 
4/19/16

One of the reasons I asked this question was to find out about MO roles that are comped well but require slightly less hours than FO and are less stressful.

 
4/19/16

From the job description does the work you will be doing sound like it will be for clients to see, or will it be for employees to see. That should be a pretty good indication.

make it hard to spot the general by working like a soldier

 
4/19/16

The only front office jobs are, simply put, revenue generating positions where you have access to clients and/or money.
Any positions used to support traders, investment advisors/analysts, or bankers, is considered middle to back-office. And there's almost no distinction between middle to back office, except for on paper, and probably only if you're the guy trying to sell someone the idea that you're in middle office so you're almost at the front.

 
4/19/16

Thanks guy!
Skinnayyy: some position state client interaction, valuation, due diligence, and support to team. Very confusing.

 
4/19/16

I am a noob! I apologize Mr. SMARTEST person on earth who has never asked a dumb question. I should take advices from you and learn how to be a dick.

 
4/17/16

I work in research, and I highly doubt it would be considered anything other than FO, back then and now.

Talk to people who have been in the business for over 25+ years and ask them what they think...

Pretty sure S&T would have a tough time getting paid w/o research and vice versa...IB could equally have a hard time as well, arguably, since alot of times the decision to add a bank to a deal (unless you're a lead) is for access to their research (ie, becoming a company covered and increasing access to potential institutional clients).

Just my 2cents

 
 
4/19/16

The bigger the shop, the more this is true. Most smaller companies have a greater percentage of employees who work front office versus middle/back because they use many more vendors unlike the larger companies who have the resources to build in house systems.

Frank Sinatra - "Alcohol may be man's worst enemy, but the bible says love your enemy."

 
4/19/16

2% is a bullshit number, I don't know where you got that.

Think of a place like JP Morgan. It has something like 150,000 employees. There is a zero percent chance that only 3,000 are 'front office'. Keep in mind that this is a commercial bank and most of the employees are tellers or other low-level employees. 2% is still not true there. I don't even know if you would consider a teller a front office position....they deal with clients, but get paid somewhere near minimum wage. It certainly wouldn't be a sought after position whether you call it front office or back office. Even with all of that, I guarantee you they have more bankers, traders, and sales people in highly sought after positions (traditionally referred to as front office) than 3,000.

A true investment bank would have a much higher proportion of the 'good' positions compared to a commercial bank. So, the questions are: who gave you this bogus figure and what made you believe them?

 
4/19/16

For the sake of this thread, let's keep it focused on investment banks. I doubt a single person on this forum is here to join a retail bank, whether it's to be a teller or not.

To answer your question, the guy giving me this statistic is an associate at JP Morgan that I went to school with. He has a middle office job, but yeah 2% sounded low.

Corporate financial/business analyst looking for career/MBA/CFA advice.

 
4/19/16

@fcv200v

You aren't very good with numbers, I take it?

The point was, even at a place like JP Morgan, where tellers and what not are the majority of employees, you still will end up with greater than 2% of employees that people here would consider front office positions. It's a stupid number and you need to discard it from your brain.

 
 
4/19/16

obviously not front, probably middle office

 
4/19/16

Front Office = your team is client facing and the work you do can/will be seen by clients, ie business comes through you
"Middle Office" (if there is such a thing) = support to direct support of the front office
Back Office = nothing to do with the clients, data entry, and "clean up" back end type work (aka filing)

OR

FO -> Starters/rotational guys/mission critical backups/Coaches
MO -> Bench warmers/athletic trainers/equipment managers
BO -> Towel boy

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4/19/16

sounds like a MO type gig.

i dont know about FO, but definately not BO

 
4/19/16

MO, though not a bad role as the skills used to develop internal valuation models are pretty transferable to FO positions. Wouldn't be my first choice if I had other options though.

"I'm tired of this back-slapping "Isn't humanity neat?" bullshit. We're a virus with shoes, okay? That's all we are."
- Hicks

 
4/19/16

I thought MO was extinct.....it's all FO/BO now, no? What else constitues MO these days?

 
4/19/16

If you have to ask...

Wall Street leaders now understand that they made a mistake, one born of their innocent and trusting nature. They trusted ordinary Americans to behave more responsibly than they themselves ever would, and these ordinary Americans betrayed their trust.

 
4/18/16

The definitions for FO/MO/BO aren't consistent.

Research isn't revenue generating, but it's an important role clients want filled by top notch people so it gets called FO (even though tellers who are also "client facing" aren't FO, though the sales people in the branch are).

Traders on CVA desks aren't client facing, nor are they (typically) revenue generating, but they have to maintain complex positions and get paid well as a result. I don't think they care what office people say they work in.

Internal treasury desks are often referred to on this board as MO, even though many banks have traders working in these divisions who are comped based on revenue.

IT is also BO, unless IT is incredibly good in which case it becomes FO.

 
 
4/19/16

front office - revenue generation => sales, trading, structuring, research

middle office - operations => usually sit near traders and whatnot and offer trade support, calculations, bookkeeping, etc.

back office - they do all the behind the scenes paperwork/compliance sort of work, making sure everything matches up, work things out with counterparty backoffice, etc

 
4/19/16

Read the new Leveraged Sell-out book, it has a hilarious section on this. Awesome book in general, I bought it yesterday and read it in a couple hours, one of the best books I've read in a while.

 
4/19/16

how much new material does the book have beyond what already overlaps w/posts on the site?

anonymous707:

Read the new Leveraged Sell-out book, it has a hilarious section on this. Awesome book in general, I bought it yesterday and read it in a couple hours, one of the best books I've read in a while.

 
4/19/16

Is leveraged sellout even a banker? I read an exerpt online and it had an author bio stating that he was actually a strategy consultant and had just lived with a lot of bankers.

www.sharpeinvesting.com

 
4/19/16

not a banker but knows a lot and did goto princeton

 
4/19/16

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