Reneging BB SA Offer?
Hi all, first time posting. Just wanted your opinion on reneging an American BB (BAML/Citi) SA Offer (London) for a higher ranking American BB (GS/JP/MS) or even a higher ranking EB (Evercore/PJT etc.)...
The thing is, as an undergraduate, it seems that the prestige of those higher ranking firms matters a lot, and even though the offer I've got is good (Citi/BAML), the prestige of one of those other banks would go a lot further in terms of starting my career. Also, a lot of my friends are advising me to always just aim for the highest, and the culture of banking is such where you need to make such decisions.
Also just to add, I do not exactly have an interest in PE/HF, so would be looking to stay in banking for the long-run, or even go down the corporate finance route later within my career.
Having said that, I have signed the contract and have been told the consequences of reneging/ read them here on this forum. I was just curious if these consequences are as prevalent in London and for a SA position, as well as just advising what the best course of action is.
Thanks
Reneging a BB offer is never an easy decision, particularly if your BB offer is from Citi/BAML and not a (weaker) European BB like UBS. However, given the current environment in London, FT recruiting is very limited and, therefore, the decision which bank to choose for SA will also have a significant impact on your FT recruiting. The likelihood that you will start at the same bank where you worked as a SA is quite high.
Having said all this, I would only renege if your other offer is GS/MS. I think the EBs (not only PJT and EVR but also CVP, PWP and GHL) in London are pretty much on the same level (or slightly above) BAML and, hence, the risk of reneging outweighs the potential upside. The situation might be a bit different if you are interested in both M&A and restructuring, as PJT lets you work across both areas.
just curious why only if it is GS/MS? what about JPM? Surely JP is the strongest out of the three
Simply because I don't think that JPM is stronger than GS/MS. Maybe some groups are, but overall you can't be certain that you will be placed in these. Frankly speaking, I wouldn't know what to do if I had to decide between JPM and an EB such as CVP in London.
Do not renege. Banking in London is a small circle, people know each other, people talk. If you were to renege, the chances of the other bank finding out are small, but it is not worth the risk of losing 2 offers with the current recruiting environment.
On another note. If I were to join Citi/BAML this Summer, and then convert to a full-time role.
Is it quite easy to make that lateral jump after my Analyst years to say GS/MS/PJT etc. ?
Most banks now fill the vast majority of their FT spots with summer interns, so it won't be that easy to lateral. However, it is certainly possible with some (somewhat) aggressive networking over the summer.
With that being said, I would strongly caution you against reneging on a summer offer. Have a few friends that have done this and it has come back to haunt some of them later on...the industry is small, don't start ruining relationships already (especially since you are considering sticking around in IB for the long-run). BAML/Citi are still solid options that will provide you with a great analyst experience/foundation.
Ok right, thanks for the reply firstly.
As for the lateral movement, I actually meant would it be easy moving over after my FT Analyst contract. So after spending 2-3 years at Citi/BAML, would it be relatively easy to move over into an Associate position at GS/MS/PJT etc.
I think the move would be pretty doable. Again, some networking is probably necessary, but associate positions will open up and you'll obviously be competitive as an analyst at a competitor bank.
Not just trying to balance the opinions here.
First of all, I think SA offers are not nearly as serious as FTs', so if you were to renege ever, do it now. Secondly, yes, banking circle is small. I worked in Hong Kong where every piece of unimportant rumor spreads fast, ie it is a much more dangerous place than London and New York as far as reneging an offer is concerned. Nonetheless, every year there are last minute changes to at least some BBs' SA hiring resulted from people reneging offers. Yes, people will talk about it, but would it matter? A very close friend of mine went through the exact same dilemma a few years ago, and the potential improvement in prestige wasn't even close to that from Citi to GS (think JPM to MS).
In the end he reneged, just for that marginal increase in prestige. What happened to him was that one director from the firmed being betrayed called him, put in a few harsh words, and that was it. The other bank's HR actually advised him on how he should approach this issue of reneging his offer. After all it's only a 2-month temporary contract. The lessons here I think is that other banks most likely would not care if a SA reneges his offer to join them as it is not a full-time commitment, only a summer internship position. So the scenario of you losing both offers I think is slim, if not entirely mythical. Secondly, doing so would do zero damage to the firm but relatively large benefit to you as banks now convert almost 100% from intern class and it is considerably harder to climb up the ladder afterwards. So, if I were you, I would email Citi/BAML HR saying you got other plans for the summer and cannot commit to this wonderful opportunity anymore. Be prepared for a few stress calls, and keep calm and work for GS.
Just keep in mind that a lot of the boutiques don't hold the same level of cachet in Europe as they do in the US (Evercore, PJT included) so I would think twice before you turn down a Citi/BAML IBD offer for a boutique.
Only notable boutiques in Europe that come into mind are Rothschild and Lazard (and the one-off boutiques like Robey Warshaw which I doubt takes any summer interns)
Do agree with you that GS/MS/JPM are a notch above Citi/BAML in Europe just like they are in the US (although I'd argue to a lesser extent to BAML in the US).
This is poor advice - why should EBs in London not hold up to BBs? And don't come up with some bullshit like "league table" as the same is the case for the US. Rothschild is a MM bank - just look at what deals they do. Lazard is so large that defining them as a boutique is misleading.
Analyst classes at EBs in London are much smaller in London (typically 5-10). Experience, senior exposure, client interaction, comps and exits into the buyside are much stronger. I would recommend anyone to take EVR over JPM in a heartbeat in London if you can live without the brand name.
Regarding reneging in London, I know of many cases where people did this and nothing happened. But I don't know of anyone who did this and had his offer revoked or other issues.
Sorry for the late response, but will opine here:
The "typical" EBs simply don't have as much clout in europe as they do in the US. Other than Rothschild and Lazard (which I specifically noted out as the only EBs with clout, so not sure why you're using them as your examples in your argument), the other EBs (Moelis/Evercore/Greenhill/PWP and so on) mostly work on cross-border deals (with the EBs representing the US company, so the US office does all the work, but they get deal credit in both EU and US for league table purposes). Not sure why you seem to take so much offense from this, as this is quite common knowledge to those working in the industry. Of course there are also some notable Evercore London over JPM London - by all means if you're talented enough to get offers from both places, you'll likely succeed in either shop. But just going off your example, picking Evercore over JPM is not (and should not be viewed) under the same context as in the US vs. as in London. As someone who's currently working in the industry, that's all I'll say, feel free to disagree.
What would you class Lazard? would you class Lazad as a MM bank as opposed to an elite boutique then?
I would say that people exaggerate when it comes to differences in prestige. To be precise, working at BAML or JPM or at JPM or MS does not have that big of an impact on your career (especially if you want to stay in banking / do corporate finance..). Renege if it is from Citi to MS / GS / PJT / Evercore / Centerview but don't do it if it is from BAML to JPM / GHL / PWP.
By the way: Source that PJT is No. 1 in EMEA in RX or it didn't happen!
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