Q&A: Vice President - European BB Investment Banking (Industrials)

Osmus38's picture
Rank: Senior Monkey | 68

Open to questions of any nature related to Investment Banking / Advisory fields as well as general finance industry.

Background:

  • BS in Mathematics (Russia)
  • MA in Economics (Russia)
  • 6 months in leading Russian, state-owned investment bank
  • 8 years in European Bulge Bracket bank, including first year in Russia followed by internal transfer to London
  • Focus on clients in Industrials and Natural Resources sector
  • Broad experience across the key Investment Banking products (sell-side / buy-side M&A, large public take-overs, IPO / Follow-ons, LBO / Leveraged Finance)

Please feel free to ask any questions!

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Comments (15)

Jul 31, 2020

How did you work your way up in the investment banking industry? Any advice for those who are aiming for the same career path?

Aug 3, 2020

I would say the following (all equally important):

  • Be sharp and eager to learn quickly. Does not matter which product / industry you cover - if you have these skills it will not take you more than 3-6 months to learn the basics. At the same time it will allow you to be flexible and switch between areas of focus hence maximizing your value to your firm
  • Invest into soft skills - relationships and visibility within the Firm are equally (if not more) important than outside your company. The more "fans" and support you have internally, the smoother your career would be
  • People you are working with are more important than teams / deals / verticals. In the end of the day, you learn from people and people support you in your career (or the opposite :-)).
    • 1
Jul 31, 2020

Assuming you worked in IB at VTB Capital or Sberbank CIB while in Russia. Would you say that doing a summer internship there is relevant/ respected for London recruitment later on?

Thank you in advance for sharing your insights.

Aug 3, 2020

It really depends. The majority of firms on the street prefer to hire first year analysts from their own Summer / Autumn /off-cycle internships (because they know these people and had a chance to test them / see in action). So partially you might be a bit behind others applying to a full-time role in London after Summer internship in Russia.

At the same time, the level of technical skills I personally acquired in VTB was extremely helpful and often more advanced than those of candidates we typically see in London. Having said that, technical skills is quite often something what people can build-up easily in the first 6-12 months in the Firm.

I would again say that it depends on your situation. Summer internship straight away in London BB will be definitely way better in terms of chances of securing a full time offer here. However, in absence of such opportunity - of course you should do Summer in Russian bank. Moreover, I think you should try your best to secure full-time offer in this bank and start there full-time while trying in parallel to break into London BB.

    • 2
Jul 31, 2020

What's the funniest/memorable work experience you encountered?

Aug 3, 2020

Believe it was one in my very first month. I managed to end-up working on 3 big pitches with meetings back-to-back on Wed / Thu / Fri. I successfully managed to finalize the first 2 books at the cost of 2 all-nighters in a row and then to finish the remaining one, getting sign-off from seniors, printing it but then failing to deliver the books to people attending the meeting as I fell asleep while I was waiting for the courier. Missed 30 alarms and 30 calls from people asking where are the books :-) Thought I'll be fired but all went well eventually - the team managed to print in the morning in the local office :-)

    • 1
  • Prospect in IB-M&A
Jul 31, 2020

Thanks for doing the Q&A.

If you intend to stay in banking long term, do you think its a smart decision to join a less work intense group as opposed to a more respected, but sweatier one?

Aug 3, 2020

It's a bit of a bet to look at it this way. The team you are joining now might be completely different in 2-3 years to be honest. People coming in / out, culture changes, market dictates its own demands (e.g. which sector / product is hot at the moment), specific firms might be better than others in specific sectors / products, some teams might have rain-makers while others do not at the moment but then these rain makers leave. So really a lot of factors which you do not have control over.

My advise is to join the team which has the broadest exposure to products and sectors, spend some time there (and yes - most likely it will be intense experience given depth of coverage) and then decide if you want to move to another team internally (usually it's easy to do after 1-2 years in your current team). By that time, you will be able to realize what's more interesting for you and where you want to be while your broad experience maximizes your chances of getting accepted in the place you want to be at.

Last but not the least, you should not look at teams where there is less or more work. Instead, you should look for the teams where there is a lot of experience you can acquire as well as talented people and deal activity. Unlikely you will get paid well and succeed somewhere where there is not a lot of work and no revenue being generated for the firm.

    • 3
  • Prospect in IB-M&A
Aug 3, 2020

Very thoughtful answer. Thanks!

  • Analyst 1 in IB-M&A
Aug 3, 2020

How do you view the opportunities of non-Russian investment banks in the Russian market compared to Sberbank/VTB/Renaissance in the short and medium term?

Thanks

Edit:
Also interested in your views on the difference in competitiveness of a degree from MSU/HSE/NES/Plekhanov and whether this would differ in Sberbank/VTB vs. European/US banks in Moscow.

Most Helpful
Aug 3, 2020

Good (an tough!) question :-)

Obviously "the pie" is way smaller than what it used to be let's say pre-2013. Moreover, it was not easy for Western banks (including BB) to compete with state-owned, big balance sheet Russian banks even then.

At the same time, I would say it's not surprising - similar picture could be observed in many European countries where you have local banks dominating / putting a lot of pressure on BB firms (e.g. in France you have SG and BNP and moreover - Rothschild and Lazard who are raving it).

But I believe there will always be a headroom for Western banks to do business in Russia as their global experience will be needed for local clients. Think about it that way - a lot of BB firms are still keeping IB offices in Moscow despite closing them in more politically favorable locations. And these people are not fools to take costs if there are no returns (current or prospective).

In the end of the day, Sber and VTB will always be there but there will always be a headroom for co-advisory.

In the longer term - well, as always - it's hard to predict for Russia. I think businesses which are not affiliated with the Govt will have preferences to work with Westerns banks. Secondly - historically Russian IB market was more ECM / DCM driven and for this you definitely need to have international firms (can hardly imagine Sber doing alone NASDAQ IPO for a Russian tech company). Thirdly - we can hope that the economy and the level of financial markets maturity will eventually progress further and there will be products which were not properly banked in Russia before (e.g. as you know - the majority of sizable M&A re bi-lateral and quite often without banks).

At the moment, by the way, understood that JPM and other US banks are actually doing quite well in Russia (which is funny given that it is US and not Europe which is putting pressure on doing business with Russia the the moment).

Can not say much about RenCap - feels like they are more about being a local mid-market boutique - but again - do not have a good view on them.

    • 5
Aug 3, 2020

These are all top universities in Russia (also MGIMO is well regarded) - have seen people from all of them. At the same time, it's all about interviews rather than school - school can maybe allow you to pass HR screening, but in the end of the day bankers who will be interviewing you (and who will be making final decision) will not be focused on your school that much. Instead, they will ask you all the possible questions on technicians (often going deep into details on comps / WACC / DCF, three statements, etc.) as well as general economy / stock markets and deciding based on these. Believe me, they will prefer to hire someone who know these answers and - even better, someone who did corporate finance for 6-12 months either in another bank (e.g. off-cycle) or in Big 4 rather than someone who has "Red Dimploma" from top university but zero experience / zero corp fin knowledge. But it's in Russia. in London it might be different - Summer Internship in London office typically does not require previous experience or tough corp fin questions during the interview.

    • 3
  • Analyst 1 in IB-M&A
Aug 3, 2020

Thank you for the interesting answers, very much appreciated!

  • Analyst 3+ in IB - Ind
Aug 3, 2020

thanks for the ama!

what made you stay in investment banking over going to PE?

And I know this is a bit personal but would you be able to provide ballpark comp figures for Associate/VP/ director level

thank you!

Aug 5, 2020
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