Why Guaranteed Full-Time Offers Don't Make Sense
Controversial opinion here, but guaranteed full-time offers don't make sense.
The point of the internship program is to feed students into their full-time program, and many students not cut out for investment banking will end up hurting groups during full-time. Honestly think that many banks will just cut analyst jobs for those that aren't able to perform well in training, and then those fresh college graduates are out of a job. Better to weed them out during the shortened internship so they can find a better career path vs guaranteeing them a job they won't be able to perform in.
It'll be harder to decide who should get offers through a virtual internship, so maybe they have interviews at the end of it to see who they want to hire.
Mod note: see the opposing point of view here: https://www.wallstreetoasis.com/forums/why-guaran…
I am an intern and I disagree, BAML will give us the FT
Current policy is that no offers until end of internship, same will apply to current interns. Its a global policy at BAML we received directly from HR 3 weeks ago (they mentioned it will be same policy for every country) so not guaranteed offers I am afraid at BAML
For this I am very unsure. I interned last Summer at BoFa and the very first day we were told "We do not have the capacity to bring all of you onboard". So even from day one we knew that not all of us were going to return. and once we all got return offers, out of say 36 interns that I knew (not just in IB) around 30 came back.
You are delusional
why are you certain
I think they should give out FT. Someone who performed well during superday could be sick or unable to perform during the last interview you're talking about. It's unfair not to convert everyone? there is a global pandemic. Why should we throw some people under the bus? they could fire underperforming people later, not now.
You're not entitled to a job. So no, it's not unfair.
As OP noted, it is better to inform people they are not fit for the respective bank before starting FT. Besides, if one would get fired after half a year into an analyst position it looks even worse on the resume.
On a more fundamental note: banks will have to hire according to the amount of deal flow there is expected over the coming months/years. The current amount of SA positions is based on pre-covid deal flow expectations. However, I assume post-covid deal flow will drop resulting in excess capacity for banks if all summer interns are converted. If banks want to filter out some of the SAs who they believe are not essential enough then that is their decision. Every person signing for a summer internship should be aware conversion rates are never a given and it is up to his/her performance and the bank to grant an offer or not.
This situation is not about throwing people under the bus or about fairness, there is no free lunch and you cannot expect banks - and all enterprises - to act as charity when their own share prices are down 30%
Imagine thinking, "hmm, I'll try banking" so you get a Moelis SA offer. And then Moelis is like, "yeah, it's gonna be a BS fake 4 week online virtual internship, have fun, also, we'll pay you and you get a FT offer". Summer goes by, the online internship is a joke as anticipated (because how could it not be - it's hard enough getting colleagues to teach you things in person, now you have to bother them by calling) and you're like "wow, Moelis is pretty cool, I'll take this FT offer".
Flash forward to the hell of being an accidental first year analyst at Moelis. KMS.
"accidental first year at moelis" has got to be top line of the month at least
And then with PE recruiting pushed up to September, the accidental first year goes with herd mentality and recruits on-cycle and becomes an accidental associate at Apollo.
We should make a movie of a guy like this who keeps accidentally / herd minding his way to being the richest man in the world. Like a modern day Mr. Smith goes going to Washington.
I agree with your point..but the thing is there is no better solution. There is no real way for interns to be judged as they would a normal, in-person internship if its virtual. Theres no way around it, that's just how it is. So what would you recommend then is a better solution besides FT offers, just draw interns names out of a hat to see who gets offers? Also, no one thinks "hmm, I'll try banking" and just randomly gets a banking internship. If someone makes it through all of the networking, technicals studying, and brutal and extremely competitive interview process they didn't just decide they were going to do banking on a whim.
Agree. Also I doubt the people that casually apply to banking positions because "banking seems cool" would apply to Moelis -- it's not a household name that the average person would immediately recognize. Goldman on the other hand...
Intern here and my bank does not give any FT offer (I wish they would). Yes it’s hard to assess everyone without meeting in person and yes there might exist inequality in terms of facilities...However, not that all banks can take every intern they hire technically, let alone the downward spiral economy. Also, we all sign up for such a volatile business - just that the mess came so abruptly. I would encourage myself thinking that pure gold is tested by fire. Gluck everyone.
i personally have seen some people get banking internship offers thinking “hmm i think i’ll try banking”
Auto-FT offers or not, the same problem will apply. The fact of the matter is, the virtual program that every firm's going to end up giving won't be a real insight and introduction into actual IB life, so every single person given the FT offers regardless if it's only a 10% offer rate will face the same issue of perhaps finding out later on that the job's really not for them. The reasoning behind giving everyone FT offers however, there's no reliable and fair way to choose that 10% from the BS virtual program you just talked about. So yeah, there's going to a lot of accidental first year analysts regardless, it's just about giving everyone a fair chance to prove they are one or not.
I’m dead.
SAs, do automatic offers really make sense to you?
Sure, it's easy to want a handout due to these unprecedented times but surely you can understand that, from the banks' perspective, it does not make sense to give automatic FTOs.
(I'm an incoming SA myself)
I think it depends on the bank. If they normally hire 90% of their summers, it might make some sense. If they normally hire 60-70% then no shot.
Very good point. If you're returning ~90% of SAs/SAssoc anyway it's probably better to just do it for PR
Why does it matter? The banks will correct this by laying off a few of these kids a couple of months into their full-time roles. All will be even and balanced once more.
Yep. Wouldn’t be surprised if some of the guaranteed FT even retract offers before FT start next year, or stiff everybody on bonuses.
At my bank everyone gets an offer in London, NYC etc but not at my regional office.
do you guys think this increases or decreases my chances of also getting an office at the regional hub?
Sounds like Citi... its probably doesn't change your chances by much though. if anything it gives you less chances to say stupid shit and miss out on a return offer.
Not really sure why this argument is widely expressed by those in IB. I know many people that work in consulting that have strongly agreed with Deloitte, PWC, Lek, strategy&, and about 4 other firms that I cant remember the name of giving auto FT offers. Yes, people won't learn much through their respective shortened program or even cancellation of the internship but people are making it out to seem that the quality of said interns is absolutely terrible and will add no value to the firm during full time which isnt the case.
It's widely expressed on WSO, not in IB in general, the "hardos". The majority of people I talked with (who actually work in banks) agrees with automatic FT.
what banks were those people from that agreed with automatic FT?
Deloitte gave ft?
Yes. They extended FT offers to their incoming interns along with a stipend that varies depending if you're heading into "S&O" or Human Capital.
They will also be offering an optional 2-week virtual learning experience.
Yes
It's particular to IB because the lifestyle is pretty hard to stomach. Being an SA would have been a chance to test it out
So let me get this straight - you sign a 12 month lease in nyc after taking a job with a bank that offered you full time and after 8 weeks they say fuck it you’re gone after training? I’ve seen some less than stellar of analysts in my class...everyone’s said they just won’t get associate promote or quit soon enough.
I'm pretty sure that the latter will probably be the case unless you screw up royally. Have heard of some people at JPM getting asked to step out during training to talk about their performance but that doesn't seem to happen that often from what I've heard about a bunch of firms.
We had people who got written up for poor performance in training, but they were a whole other level of bad (like skipping work randomly, sleeping in class, bombing all the tests). Don’t know how some of them got hired in the first place. Anyone who gave an honest effort and passed their licensing exams at the end did well enough to stick around.
The guaranteed offers make complete sense in this environment. At my EB we receive something like ~3,000 summer analyst applications and end up sorting through all of them and interviewing a couple hundred of them for first rounds. This whole process takes a massive amount of effort on both the HR side and especially the bankers side, but also allows us to really effectively identify good candidates.
If you look at the resume book there is basically no one in the class that slipped through the cracks. Everyone's resume looks like 3.9+ GPA, good school, and some smattering of finance internship, finance club leadership, etc. They all know exactly what they are getting themselves into at the start btw, you have to in order to get through our interview process. At the end of the summer the yield is essentially always 80%+ and it's not like the 20% were complete dummies, they just didn't quite make the cut for our firm.
Also I've never seen an analyst at our firm who has been cut within a couple months. They get tons of opportunities to improve before that is even a topic of conversation. They will probably have even more slack if these guaranteed offers are put in place
If you don't mind me asking -- what's your EB's stance on this? Have they considered automatic offers at some point, and even if they're not are conversion rates still expected to be consistent like previous years'? What's the possibility "select offers" are given out like someone mentioned last week?
One of my biggest fears starting out was getting fired after making one mistake. Thankfully, I never fucked up, but I never got the vibe that if I messed up, I would be gone. Whenever I had a question or was unsure of what to do, I would just ask and help would be given. While I was an SA, the FT people started and one guy was fucking up but he was just helped more. The bank is not out to fire you and will only fire you if you truly fuck up.
I see both sides of this argument. I do support the guaranteed return offers for a few reasons though: * Bank Culture & Rep - future recruits are more likely to be impressed with the culture of a firm if they saw they "take care" of their own. The bank also gets to tout their strength and confidence in their hires to the world * Decent Candidates - if a candidate has already been hired, there's a decent chance that they aren't total duds ( I am well aware there are complete asstard interns who need to get weeded out) and as a poster alluded to above, the firm will give them ample opportunity to perform. If they don't perform, fire them or phase them out * Less Uncertainty - banks will know who will be a part of their team and not have to go through the hassle of putting analysts and associates through rounds of FT recruiting. Yes, not all interns may accept their full-time offer, but I would be surprised if they don't accept on the spot in this climate
It's important to keep in mind the automatic return offers are not SOP for hiring and that hopefully, this is the only year it is needed. I think those giving the return offers are helping spread some positive morale with potentially limited repercussions on their end. Just my two cents
it's a lot cheaper than continuing to employ all the 2nd-4th year analyst/associates that will inevitably be fired between 2021-2022.
It is obvious that OP is someone of privilege because he clearly doesnt understand how a bank can fairly evaluate its intern crop if some come from backgrounds where they live at home with parents and possibly share a room and have no place to work. Imagine working 16/17 hour days out of your bedroom with a sibling sleeping next to you...
But I guess you dgaf about these candidates chances do you. $100 says you're a posh white snob who believes diversity is a bad thing.
Look I agree that it’s hard to evaluate an intern virtually. If you ended it there, then I could have backed you. But pulling the diversity card and calling someone a privileged white man for not handing you a job is pathetic.
States are starting to open up. You’re still getting paid good money. If sharing a bedroom is going to stop you from getting an offer then go rent somewhere in your home town. It would still be cheaper than staying in nyc. I’m just happy to still have an internship in this environment. Have some faith in yourself and EARN the job offer.
Very easy to say from that perspective but people go through things and face challenges you don't, so you can't just come with some blanket excuse of "if you want it bad, EARN it". Thats completely unsympathetic to genuine real life problems.
I think u seem to forget this is finance not charity, banks have no responsibility to "fairly" evaluate interns...and this is coming from a fellow minority
the whole "privilege" argument is bullshit man, internships don't have to be fair and if u really want the job you'd find a way to make it work instead of bitching about how the white man oppressed you.
geez its people like you that give minorities a bad rep - check yourself
I believe you are a minority as much as I believe that the KKK are not racist.
I have been validated by firms decision to extend FT offers, so they obviously believe it is their duty to fairly assess their talent. Sounds idiotic to presume otherwsise actually...
Don't know a minority person alive that would seriously type that shit up and post it.
Ok... sorry you didn't get one and feel the need to justify your misery lol
I am not actually at a Bank this summer you cretin, I will be at a Long Only Fund. Finance is up to the eyeballs of you and your type. Diversity is a steamroller and you and the frat boys only got so long left before your mediocre bunch keeps sliding into IB with your 'polish' and your connections.
Good luck 'Prospect'. Keep losing out to them diversity candidates but next time, hold the salt.
Ok bud, sorry for taking your spot in IB. Better luck next time champ. Enjoy not beating the market.
Ahh the good ol' struck out in recruiting but ended up in the "buy-side" at some middling "long only fund" nice cope lmao
Obviously there's a reasonable case to be made for either giving out or not giving out automatic FT offers. I haven't really seen someone say this but I'd imagine there's an intangible/immeasurable benefit to giving out offers if you see your summer analysts as future employees whose loyalty and dedication to the firm will one day matter. Obviously, this isn't how some firms or managers will see things but just some food for thought
To quote my HS history teacher: "Never be part of a club that would automatically have you as a member"
weeeeell...sure but maybe not applicable in the midst of a global pandemic?
So you would turn down a Moelis FT offer...
You're right. But there aren't many better options, if any. It's lose-lose-lose-lose-lose everywhere at this point.
exactly....thank you. people keep seeming to forget that obviously auto FT offers isn't the most ideal solution. like yes, we get it, but there isn't any better solution..
Well banks can still do the virtual internship then decide later. At the moment maybe they need some flexibility. But to be frank cheers to those folks at Citi and Moelis. Some people might concern how the lack of in-person internship would limit the understanding of working in banking - but at least they got the offer -> the luxury to decide for themselves.
Quality control is going to be a huge issue... The biggest problem in my eyes is a situation where a bank cancels the internship program and gives everyone FT offers... An undergrad not having an IB internship program is going to weigh heavily on the 2Y and 3Y analysts... I think your option here is to hold virtual internships (with modeling / case studies every week or so), provide some serious feedback on a weekly basis, and move forward with a virtual round table at the end of the internship.
Someone in the industry should chime in on this idea but — for banks that have extended automatic offers, can’t they just hold an extra month of training to make up for lack of experience in the office?
.
Pretty sure all FT offers to interns are being offered on 6-12month probationary terms, stated in contract? Quality control will regulate itself. I wouldn't be worried.
Also, seems like this is only a sell side trend? Haven't heard of any automatic FT offers at buy side shops, most are going remote - correct if wrong.
Seems like OP perceives this as free pass to 'prospects'. Seems like OP does not recognize the shitshow of having a semester suddenly halted, borders closed (intl student cannot go home, study abroad programs operating at 3am), the absolute fuckery that is online learning/continuous testing, and overall imbalance to your permanent accommodation, work-study income, institutional resources et al. But I digress.
Can you explain more what you mean by probationary terms? and is that an assumption or something you know to be true at Moelis and/or Citi?
Probationary meaning your actual employment is contingent on your performance during said period. Cannot speak for Moelis or Citi, sorry.
From the perspective of someone who's going to be starting a 1 year MSF this fall as a career changer from pre-med biology and no finance experience yet, am I fucked to get a job starting in 2021....? I know I'm not gonna be recruiting into BB IBD, but for any banking?
The other side of the coin is that you end up weeding out good interns by not giving out auto return offers. Why? On the firm's side, it is difficult to virtually evaluate interns, and on the interns' side, it is impossible to virtually complete a finance internship.
People come from so many different backgrounds. I live on the West Coast and would have to wake up at 3-4am and work until 3-4pm to keep up with the firm on the East Coast because I'm in S&T. I have chores to attend to and family that needs me to go get groceries. Luckily, I know how to code and could use that as a way to impress more coding heavy desks. However, others may have it much worse than I do, and underperform as a result.
By giving out universal return offers, you may have some people who don't fit in, but they'll leave if they really don't like it. Otherwise, you could end up not hiring interns who are great but just don't have the best home environment.
I think it is important to remember that these are absolutely unprecedented times. In normal times, I would absolutely not support guaranteed full time offers. I believe internships are incredibly important for interns to prove themselves to the company and decide if both banking and the bank they are at is right for them (I went through the intern programme myself and I am still grateful for the experience - it made me certain I was making the right choices).
However, these are not 'normal' times. These are times in which there are no easy decisions, and the past format of intern programmes does not align itself to the pandemic adjustments we need to make to our everyday lives. For this reason, I think giving out FT offers is the right thing to do. Honestly, given the 10 week, in person option is unavailable, how can banks accurately assess how prospective interns do? You can give them a presentation, or ask them to build a model, whatever, but that does not simulate the actual work environment - nothing does other than physically being there. And that is simply impossible right now without seriously endangering the health of full time employees.
I'm not in HR so I can't speak for their rationale, but I think giving FT offers is the right thing to do. So what if a couple kids end up 'accidental' bankers. There will also be kids who will come in and do great. The kids who are 'accidental' will get weeded out - we all know how that works, and banks are great at doing it.
Just my 0.02. Personally, I think Citi and Moelis have done a pretty great thing and it speaks volumes about their culture. Now it is up to those interns to go in as FT's in 2021 and prove themselves.
Moelis culture? HAHAHA
Moelis doesn't have good culture, they only gave out all FT offers because they have rx and would still be able to staff them. And historically their rates have already been high
My view is , for banks giving out guarantee FT offers, the first 2-3 months will be probation period which gives the analysts the real summer internship experience. If they don't make the cut, the firm can terminate the contract anytime under the probation period.
Yes, kinda suck if you get terminated just 1 month into your FT position and too late for Master program.
I’m a VP at BB.
Right now it looks like no one is getting offers at the end of the internship. One of the proposals is there will be an interview about 2 weeks after the internship ends which will essentially be presenting a case study that will be assigned on the last day of your internship.
Sounds like the worst possible solution
Worst policy I've heard of lmao, pretty much ignores every valid concern in this thread as well as being identical to a lot of SA interviews. What's really the point of re-interviewing people in the exact same way, but this time in shitty conditions
Not only, the case study will be prepared under unsupervised conditions. A joke!
The issue is that a virtual internship that will likely be shortened presents challenges in terms of assessment of candidates. This solution absolutely sucks but it offers a way to assess candidates on a level (as possible) playing field, without them having to give up time during the shortened internship to work on the case study and dedicate that time to deals / projects with teams.
The approach may also vary by group - some are very focused on picking only the best talent because crappy analysts / associates are a very painful problem. Let’s just say that in our group we haven’t had good experiences with giving borderline interns the benefit of the doubt. If it results in a smaller class, they’ll complement with laterals but getting rid of shit analysts who interned and got a FT offer takes up to 2 years sometimes.
I understand that the approach doesn’t address your concerns, but it’s probably better you get now that bank leadership doesn’t really give a shit about your concerns unless you generate revenue or it’s affecting productivity.
Would you be willing to let on whether you're at an American or European BB?
someone guessed he is at MS due to prior question he asked 4 years ago. (though he might have changed banks since)
I mentioned in another post that this is the most likely outcome- I had to go through this at a BB during "normal times" because the bank was unable to assess who will receive the FT- I 100% see this as a viable solution and most likely will be the path that the bigger banks take (GS/JPM/MS)- competition will be fierce but the offer rates will most likely be abysmal this summer so they need an official assessment to point to in order to justify why some interns receive FT and some dont- good luck everyone
Hope my BB won't do that lol, I still think it's unfair given that other banks on the street gave out FT offer. It is not because they are stupid that they did that, it's because they have somewhat anticipated the unfairness of all these processes amidst a pandemic situation. Anyway, good luck to everyone
i guess i get where this is coming from but this would be such a huge red flag to incoming classes in the future culturally
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