9/23/11

I'm looking into a Private Banking Analyst position at J.P. Morgan. I'm a senior at a semi-target, and I've worked in PWM before.

I'm curious to know:

-How does private banking differ from general wealth management (besides just the pure dollar amount needed to be a client)?

  • How actually "analytical" would an analyst position in private banking be? Would I be "supporting" higher-ups or selling more often than managing asset allocation, running performance reviews, and generally staring at Excel?
  • Would this be a good transferable position into other areas of Asset Management (i.e. portfolio management, hedge funds, institutional fund/mutual fund management)?

Thanks

Comments (38)

9/23/11

1) Doesn't differ at all besides investment options
2) Not analytical at all
3) No you never see someone from PB go to portfolio management, you could work at as a salesman for an AM shop but definitely not as a PM. If that's your goal you'd have to start in IB or ER.

Financial Modeling

9/23/11
FutureBanker09:

1) Doesn't differ at all besides investment options
2) Not analytical at all
3) No you never see someone from PB go to portfolio management, you could work at as a salesman for an AM shop but definitely not as a PM. If that's your goal you'd have to start in IB or ER.

Lets see Future Banker, you're wrong on all three accounts. To be honest, here's how it goes:

1) It allows you to better serve your client's needs. It all depends on your client's needs and the shop you are at.

2) The answer is that it depends on the structure of your account and clients. I know people in PWM that have a high degree of analytical basis and I know others that have no need as their basis is managed money. That said, it all depends on your client base. As to the second part, it depends on who you work for. That's the straight up truth.

3) The answer is an astounding yes, however, it is a yes with a caveat. That caveat is pretty simple... either you work for a team that directly manages their own discretionary money or not. If you work for a group that has a discretionary account base, you can segue into being a PM more readily than you would expect, especially if you can site performance.

Hope that helps.

9/24/11
Frieds][quote=FutureBanker09:

3) The answer is an astounding yes, however, it is a yes with a caveat. That caveat is pretty simple... either you work for a team that directly manages their own discretionary money or not. If you work for a group that has a discretionary account base, you can segue into being a PM more readily than you would expect, especially if you can site performance.

Hope that helps.

Thanks for that... Are you referring to discretionary money as in the client fully entrust to the firm to invest as they like as opposed to needing to send out investment suggestions?

Is the PM of funds of funds much different than PM of individual securities?

9/23/11

PM me

9/23/11

There are portfolio managers within the private bank doing mostly fund of funds work. It's incorrect to say that you never see people from PB going to portfolio management when in fact it's quite the opposite. Not all PB roles are sales roles, some are highly quantitative.

9/24/11

Plus a random questions, I notice that in Asia most private bankers are girls? Is that the same in the US/UK?

My formula for success is rise early, work late and strike oil - JP Getty

9/24/11

No. I was at a top PB this summer and rest assured, 99% of the RMs were men.

9/24/11
Walkio:

No. I was at a top PB this summer and rest assured, 99% of the RMs were men.

How was your experience? Besides the lack of distractions in the office haha

9/24/11

Discretionary is a term used to discuss who has the ability to make the investment decisions. In Asset Management, if you give your money to a financial advisor/hedge fund/private equity fund/etc., unless you explicitly give that person the authority to invest in a manor they see fit, you are the ultimate person in charge of what happens in your account. This is why, when you invest in PE and Hedge Funds, you agree to give away any authority to invest - it's written into the subscription documents.

To further illustrate... You have 10MM in your account with a broker at say... UBS. He has an idea that he thinks is a good play. Unless you have that money in an account that he has agreed to take a direct fiduciary responsibility in managing it, he would need to call you and discuss the idea with you. However, if you agreed to let him manage the account, he could buy and sell as he wants. You traditionally see this when you have brokers that have specific strategies that they use (ie. Uncovered S&P Options trading strategy, Custom EM Portfolios, I know a guy with a Volatility management strategy that he uses for clients with extremely concentrated positions, etc.).

Hope that clears things up.

9/25/11
Frieds:

Discretionary is a term used to discuss who has the ability to make the investment decisions. In Asset Management, if you give your money to a financial advisor/hedge fund/private equity fund/etc., unless you explicitly give that person the authority to invest in a manor they see fit, you are the ultimate person in charge of what happens in your account. This is why, when you invest in PE and Hedge Funds, you agree to give away any authority to invest - it's written into the subscription documents.

To further illustrate... You have 10MM in your account with a broker at say... UBS. He has an idea that he thinks is a good play. Unless you have that money in an account that he has agreed to take a direct fiduciary responsibility in managing it, he would need to call you and discuss the idea with you. However, if you agreed to let him manage the account, he could buy and sell as he wants. You traditionally see this when you have brokers that have specific strategies that they use (ie. Uncovered S&P Options trading strategy, Custom EM Portfolios, I know a guy with a Volatility management strategy that he uses for clients with extremely concentrated positions, etc.).

Hope that clears things up.

Thanks.

Financial Modeling

9/26/11

Thanks whoever threw shit at me. If you look at the paths of any mutual fund manager, or asset management firm like Wellington's portfolio managers, you will see they pretty much all came up through IB or through equity research. The one exception is people who were in some specific industry i.e. energy then got an MBA. You will be doing fund of funds type stuff. It's the same as welath management only your options are bigger, i.e. 10mm may gave you access to HFs or PE firms you wouldn't normally. Other than that it's the same hustle. To be a portfolio manager you would really have to have in depth modeling experience that would only be gained through IB or ER

9/26/11

FutureBanker09 - While in general I agree with you that it's an uphill battle to transition from PB to portfolio management, it definitely can be done, especially if your PB experience is with a reputable PB analyst program like JPM, GS or CS as opposed to getting PB experience at places like ML, MSSB or UBS where you are doing a lot of cold calling.

As with most everything else, you get what you put in - if you work hard, do some things to separate yourself from the crowd (CFA, etc), there is no reason why someone can't make the transition.

9/26/11

Tan86, the reputable shop issue is definitely a given in this case. However, it really depends on the nature of what you do and what group you are in within any top tier PWM Shop.

I'll give you guys the case of two friends of mine who were both at top shops in PWM. One of my friends is now a junior PM at a DC based asset management shop and at his time working for BB PWM, he was his team's portfolio analyst. He left the PWM shop in May of this past year and has been with his new firm for about 3 months. The team he was working for had between $75MM - $100MM if I recall in a discretionary portfolio, and he did everything - from valuations to position analysis, research to reporting and everything in between.

The second was of a case of a friend of mine who had a similar situation, as the portfolio analyst for a team of Financial Advisors before moving on to work for the BB PWM's Chief Investment Officer. He was a smart kid and had completed his CFA L1 and L2 before he ended up leaving for a Hedge Fund about a year and a half after transferring into the CIO group. I know it's two cases, but the avenues are definitely there.

It really is all about the experience you end up getting from whichever group you are in and how you choose to leverage it.

9/26/11

Holy hell. I could write a book on this, but in the interest of time:

1) Private Banking is wealth management for high net worth and ultra-high net worth clients. Private banks handle client's investment, credit, banking and trust & estate planning needs.

Investment banking is advisory and underwriting work for public and private companies. Could be helping with a company going through an IPO, issuing debt, private placements, underwriting municipal debt for municipalities (public finance), or it could be advisory work on the M&A transactions of companies and PE firms.

2) Minimal on the base level, very large on the bonus level, especially at the early levels.

At my firm, base is 70K for first yr analysts, 80K for second yrs. The PB has 3rd yrs which get 90K base. However, at the bonus level the IB bonus will typically be anywhere from even (best analysts in PB will get bonuses around what a bottom bucket IB analyst will) to 40K+ more (worst analysts in PB vs top bucket IB)

At the higher levels, IB tends to make more, but it varies so much based on performance I could not even begin to throw out estimates.

3) The day to day will be different. At the analyst level, PB analysts put together performance reports and asset projections and do prospecting, while IB analysts do modeling/DCFs/ all that good jazz.

IB day-to-day stuff at the analyst level tends to be more stimulating if you are into numbers, and have a higher interest in private markets vs public markets

PB day-to-day stuff for analysts will be more your speed if you like public markets and want to have some client facing activity. I'm a first yr analyst in PB and I have started to go with my banker on client/prospect meeting a decent amount already only 6 months in because I've absolutely busted my ass and have shown I'm not entirely incompetent. This week was the first time my banker let me pitch something to a prospect, and it was a rush. Being 22 and confidently pitching some of our capabilities to a 50 year old prospect worth $10MM and then having him pulling your banker aside after the meeting to tell her how impressed he was with her analyst is the high point of my short professional life by a mile.

At the higher levels, the differences kind of converge. BSD MD's will just go out and bring in clients and make it rain, albeit the nature of the relationships is fundamentally different.

Also, maybe the biggest distinction, hours are much less at the PB level throughout every career level, hence the lower pay.

Hope this helps!

And any IBers out there, please feel free to add color to anything I may have gotten wrong in my comparison, because this is just from my understanding of the investment banking through prepping for interviews and talking to my numerous IB friends at different firms.

I would agree with you, but then we'd both be wrong.

9/26/11

rogersterling59:

Another PB newbie here with some questions for you (if you wouldn't mind answering of course)

1. How competitive is PB recruiting?
2. PB, from what I've seen, is sounds extremely appealing to me. But I have to ask, what are the exit opps for this type of gig other than the obvious AM stuff?
3. Do you like what you're doing?

"Those who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety."- Benjamin Franklin

9/26/11

lasampdoria:
rogersterling59:

Another PB newbie here with some questions for you (if you wouldn't mind answering of course)

1. How competitive is PB recruiting?
2. PB, from what I've seen, is sounds extremely appealing to me. But I have to ask, what are the exit opps for this type of gig other than the obvious AM stuff?
3. Do you like what you're doing?

First off, I don't even know what the fuck the person above me is trying to say.

//www.wallstreetoasis.com/forums/JPMorgan-private-bank-compensation-ladder-lifestyle

Start here for question number 1 and other info, I answered that question in this thread.

2) Your best bet for exit opps is the network your ass off to start. Then, either go get and MBA and reset if you want to do consulting or IB or something like that, or get your CFA and try and move into the mutual fund/Asset Management space. If you get your CFA and really hit the pavement hard networking, it's not unheard of to get an interview or two with some value-focused hedge funds if your lucky. I know some PM's in the fund space at my firm started off in PB and then got a CFA and slowly worked there way to the funds space and climbed the ladder. But these kind of things are always a crap shoot anyways. My colleagues in the Texas offices of my firm say they have a number of kids go to PE because some of the senior PB people used to work in PE and help them out with recruiting, so there is really no nailing down exit opps.

3) I really like what I do. I get to interact with clients at a very early point and my career, and it's both rewarding and thrilling to pitch something and have it resonate when just one year ago I was having the best senior spring imaginable. Definitely had to change my lifestyle and learn quickly, but it is definitely worth it

I would agree with you, but then we'd both be wrong.

9/26/11

Wow! Thanks so much!

"I do not think that there is any other quality so essential to success of any kind as the quality of perseverance. It overcomes almost everything, even nature."

9/26/11

PB recruitments are target based. If you fulfil their target at a time you are announced best employe.

9/26/11

Private banks provide a lot of services to wealthy individuals; not just being their 'bitch'. I have a friend working at Credit Suisse who told me he had people working below him who brought in more revenue, but did no actual work and knew very little about Finance itself. Not sure how true this is, but it seems to be the case in some of these places.

Also, PB provides AM services too.

9/26/11

not sure if you are still keen for an answer, but somewhere in this thread some folk explained that nicely. i'm not qualified to share a link but please check this:
JPMorgan-private-bank-compensation-ladder-lifestyle

unexamined life doesn't worth living

9/26/11

PWM and Private banking both fall under the wealth management umbrella. It varies from firm to firm, but PWM = HNW and PB = UHNW (Ultra).

Investable assets separates the client groupings (General Ranges).

PWM = $1M - $25M
PB = $25M+

9/26/11

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

9/26/11

Do you want to know about Wealth Management and Private Client services, or Private Placements?
. . . not too descriptive.

9/26/11

Private banking is a separate category that seems to be growing quickly.

I can see info from company sites like below, but it doesn't really give you too much info.

http://www.jpmorgan.com/pages/jpmorgan/private_ban...
http://www.citibank.com/privatebank/

9/26/11

What do people in PB make down the road - like after 7-15 years?

9/26/11

See the Asset Management section (PB does fall under AM).

It depends on who you ask, though. A lot of people on here are die-hard, balls-to-the-wall IB prospects. They'll bitch about "oh PB is for pussies" and whatnot. Really, though, if you're looking for a work/life balance this seems the way to go.

"You stop being an asshole when it sucks to be you." -IlliniProgrammer
"Your grammar made me wish I'd been aborted." -happypantsmcgee

9/26/11
Denver Monkeyannabe:

See the Asset Management section (PB does fall under AM).

It depends on who you ask, though. A lot of people on here are die-hard, balls-to-the-wall IB prospects. They'll bitch about "oh PB is for pussies" and whatnot. Really, though, if you're looking for a work/life balance this seems the way to go.

and you can live in almost any city in the country. I know a 1VP in Pittsburgh that doe PWM (similar) and makes ridiculous money. Plus he goes to pro athlete's houses and shit fairly regularly

If I had asked people what they wanted, they would have said faster horses - Henry Ford

9/26/11
happypantsmcgee:
Denver Monkeyannabe:

See the Asset Management section (PB does fall under AM).

It depends on who you ask, though. A lot of people on here are die-hard, balls-to-the-wall IB prospects. They'll bitch about "oh PB is for pussies" and whatnot. Really, though, if you're looking for a work/life balance this seems the way to go.

and you can live in almost any city in the country. I know a 1VP in Pittsburgh that doe PWM (similar) and makes ridiculous money. Plus he goes to pro athlete's houses and shit fairly regularly

This VP you know, what firm does he work for and how long has he been in the business?

9/26/11

Private Banking - managing Shaniqua's checking account and sending her statements when she fails to pay her credit card on time (again)

Private Wealth - telling Shaniqua which mutual fund / asset mix she should use to enhance her lifestyle come retirement and then liquidating her account when she can't cover margin calls.

9/26/11

Correct me if I'm wrong, but isn't private banking slightly more selective than managing "Shaniqua's" checking account. I have a cousin doing private banking with JP Morgan, and there, I believe clients must invest a minimum of 25 million dollars.

Private Wealth, as I understand it, is similar to what NoTears described it as. You basically do financial planning for clients.

9/26/11

They dont really bother with people that have 25mill. They can get into the PB but the bank has much bigger fish to deal with.

Think of PB as your standard chase branch but for people who have 100mill+ net worth.

Sounds basic, however you have to take so much of their personal status into account. You advise them on investing etc.

Very interesting and personal job. You wont get the same bonus as IB FO but your salary is on the same level and the bonus is good enough to put a down payment on a house down.

9/26/11
9/26/11
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