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Investment banking internships this summer and last: why so competitive?

61 replies

TheHouseofGirth · 20/05/2024 15:22

Looking for some advice on IB internships. We are foreigners in the Uk and unfamiliar with the system, so please forgive any stupidity. DS is finishing his second year studying economics at a magnet uni, in the top five unis for economics. Not Oxbridge but close. He is in the top 1% of his class, with an average of 81%.. Also part of various relevant student societies. 4 Astars at A levels, including FM.

For the past two years, he has been trying to get a summer internship in IB. Applied to over 60 and made it to the interview stage in a few, but unsuccesful. We did advice him to apply more widely to thinktanks, consultances, and charities, but he said that applications are so time consuming he wanted to focus on IB internships as that is what he really wanted to do. I could see they were really complicated and he had tons of tests and interviews. So I let him do the best he could. Now he doesn't have anything for this summer, and it's too late to apply to other internships. In hindsight he should have set his heights lower, but it seems incredibly competitive this year. He is by no means shy or introverted; I think he presents well, but I guess he must be doing something wrong.

Would anyone have any advice? He seems certain that not having an internship this summer means he won't get a graduate job next year when he graduates and will have to do a Masters. It's harder for us as he is not yet a UK citizen ( though eligible for ILR next year).

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Radiatorvalves · 20/05/2024 15:26

I don’t have any advice but your son is right to say that not having had an internship will be a huge disadvantage when applying for graduate jobs. Can he ask the firms for feedback? That might be helpful if he wants to reapply.

Rummikub · 20/05/2024 15:27

He should go speak to his uni careers team. They can support and advise.

TheHouseofGirth · 20/05/2024 15:41

Yes, he is definitely speaking to careers team and asking for feedback. I feel sorry he is now at a disadvantage for jobs, and wish I had guided him more. But he's always been very independent and I don't like to be a helicopter parent.

Most of his very clever friends haven't got IB internships either.

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happyharpy78 · 20/05/2024 15:50

DS did one of the summer before last. Having applied for loads with no luck he finally landed one when he'd virtually given up hope. When he did it it really was a six week job interview, he was assigned to a team and given 'real' tasks to complete. It wasn't just work experience if you see what I mean , they were definitely trying the students out, and he has since learnt that that particular bank won't take interns unless they are virtually certain they will have a job for them when they graduate. Consequently there weren't that many positions relative to the number applying. My only advice I'm afraid is to keep ploughing on and apply for as many as possible. Better to have an internship somewhere than nothing at all.

Lilibut · 20/05/2024 15:55

Hello!
Just wanted to say that I don't think your DC is doing anything wrong. My DB sounds very similar to your DC (right university societies including treasurer and president of a couple, great grades). His application journey was similar to your DC's too. He applied to roughly 80 in his second year. He only was accepted into one and that didn't turn in to an offer. And then as a graduate he had an offer for a summer internship at essentially a certain vampire squid bank with no guarantee of it turning into a permanent role OR a grad scheme a more "average" investment bank. He is now, two years later in a permanent IB role at the bank that only offered the internship.

I think when you have the right education etc, as your DC does, it really does come down to luck at the end of the day. Tell him not to despair and keep persevering.

On a more practical note, do you know anyone working at a bank? My DB was able to secure a couple of weeks shadowing at a prime brokerage. My DB's friend's sister only had a junior role at the prime brokerage but she asked her line manager, and her line manager agreed to take him on. The reason I mention who it was that organised it is because I feel like sometimes people think you have to know a fairly senior person to organise something that isn't a formalised scheme, but sometimes you could get lucky!

Good luck to your DS!

macshoto · 20/05/2024 15:57

Internships are even more difficult to get than graduate jobs - particularly in investment banking - as the numbers of positions available are so small.

I wouldn't rule out getting into one of the consultancies - Big 4, strategy houses, etc. - and using that as a route into investment banking. It's a route to a qualification and then into the banks.

All depends on what he wants to do in Investment Banking...

titchy · 20/05/2024 15:59

Is he on a student visa? I wonder if that's putting them off as he isn't supposed to work more than a certain number of hours a week.

MaggieFS · 20/05/2024 16:00

I can't speak for IB's but I can speak for big corporates...

The number of excellent students outweighs the number of places. The number of students at excellent unis, with top grades outweighs the number of places.

What skills and experience can he offer? How is he setting himself apart? What leadership roles has he undertaken?

Needmoresleep · 20/05/2024 16:01

I don't know what a magnet University is, but DS was studying economics at LSE and also struggled to get an internship.

In the end he got one in his second summer with the Civil Service and not in London. It was clear that he was competing with applicants from all over: Oxford Brookes, Westminster U, etc. Studying at the LSE only started to be an advantage in the final stages and the competency tests. Just having an internship taught him a lot about the workplace. IB ones will be hugely competitive. It is a very well paid career. Goldman Sachs, and perhaps others also have Easter internships, which can then lead to a summer internship and then onto a job. Based on the experience of DCs friends IB can have a big shake out at the end of a couple of years, so some of those prancing around boasting of their big salaries then found themselves unemployed.

Fees for Masters can be the same of International and home students. They certainly were at LSE. Masters at places like the LSE are hugely demanding. There won't be a lot of time for applications then. Not being from the UK ought not be a disadvantage, especially if he has a second language, or a second passport (EU/Us/Singapore/Aus).

Where is the problem? DS clearly struggled with interviews so finally I bought him four sessions with a communications trainer, who was able to point out things he was not even aware of. His University careers office might offer some help, or there will be plenty on YouTube.

shivvametimbas · 20/05/2024 16:09

@TheHouseofGirth it may be something to do with this: https://www.ippmedia.com/the-guardian/news/world/read/change-in-uk-visa-rules-affects-foreign-students-2024-05-18-153722.

There was a similar article in the Financial Times a few days ago.

It may be that employers are being cautious about internship offers for the same reason. But, if so, they should make it clear in their recruitment blurb.

Change in UK visa rules affects foreign students | The Guardian

https://www.ippmedia.com/the-guardian/news/world/read/change-in-uk-visa-rules-affects-foreign-students-2024-05-18-153722

SilverBranchGoldenPears · 20/05/2024 16:14

It’s simply a case of supply and demand. The market is flooded with too many great candidates so things like hours availability may matter.
It’s not a reflection of your son rather than the market. Any work is better than no work so even volunteering would make sense - charities for instance, or doing a summer course in financial mathematics for instance.

Needmoresleep · 20/05/2024 16:15

Are internships included? I would have thought that starting salaries for IB jobs in London were above the threshold if this is correct: "the wage needed by those aged 26 and under is 30,960 pounds"

TheHouseofGirth · 20/05/2024 16:16

Thanks for all the kind advice. Just to reply:

@titchy No, not a student visa. He is on a Tier 2 dependant visa, as both my husband and I got jobs here under the Skilled Worker scheme. This means he can work as long we are working. But it is possible, I suppose, that employers don't want this complication. He will be eligible for ILR mid-2025, so a bit after he graduates. Sorry, I should have made this clear. Trying to avoid too many identifiying details!

@Lilibut I think he was aiming for the vampire squid bank! I have advised him not to chase money, but I think he feels London is very expensive for foreigners, which it is. Well done to your DS. We do know people in finance, but I don't think connections really work any more.

@Needmoresleep I understand magnet unis are Oxbridge, LSE, UCL and Warwick. Well done your DC.
@MaggieFS yes, I think we are realising now how competitive it is. He has a second language, leadership roles as heads of uni societies, sports experience ( though I think no one cares about that) and of course good grades. Maybe not enough though.

I am not sure about the sessions with a comms trainer, but will consider it.

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shivvametimbas · 20/05/2024 16:21

Needmoresleep · 20/05/2024 16:15

Are internships included? I would have thought that starting salaries for IB jobs in London were above the threshold if this is correct: "the wage needed by those aged 26 and under is 30,960 pounds"

Internships are part of the recruitment process for graduate jobs, so the same logic would apply.

However, I take your point about the starting salaries.

TheHouseofGirth · 20/05/2024 16:25

shivvametimbas · 20/05/2024 16:09

@TheHouseofGirth it may be something to do with this: https://www.ippmedia.com/the-guardian/news/world/read/change-in-uk-visa-rules-affects-foreign-students-2024-05-18-153722.

There was a similar article in the Financial Times a few days ago.

It may be that employers are being cautious about internship offers for the same reason. But, if so, they should make it clear in their recruitment blurb.

Edited

I think this may have something to do with it, possibly. A lot of things are up in the air in re visa rules. Or he just doesn't interview well, but thinks he does.

I was taken aback by some of the questions he was asked. There was a very complicated mathematical question about a cube with 100 sides, 50 painted red and 50 painted blue and some such...

OP posts:

shivvametimbas · 20/05/2024 16:33

TheHouseofGirth · 20/05/2024 16:25

I think this may have something to do with it, possibly. A lot of things are up in the air in re visa rules. Or he just doesn't interview well, but thinks he does.

I was taken aback by some of the questions he was asked. There was a very complicated mathematical question about a cube with 100 sides, 50 painted red and 50 painted blue and some such...

Show quote history

Sounds like a trick question. Part of the definition of a cube is that it has 6 sides.

TheHouseofGirth · 20/05/2024 16:39

Definitely a trick question and I may have stated it wrong, but just to give an idea of the range of questions!

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MirandaWild · 20/05/2024 17:27

It has a been a really brutal year for internships, return offers and straight job applications in this and related fields. Lots of top candidates left with nothing f

TeamPolin · 20/05/2024 18:40

I used to work in the HE sector supporting students with internships and placement years. IB student placements, or indeed any banking placements were known to be like gold dust. Comparatively few roles and tens of thousands of applicants. Honestly your DS would be wise to try and take any professional placement year/internship role as, if he confines his search to IB, then statistically he's likely to end up with nothing....

In 8 years working in the sector, only one of my students scored an IB internship. However, a lot of my students took other internship roles - civil service economics, consultancy, corporate finance etc and were successful at moving into the banking and investment sector upon graduation. The graduates with placement year experience secured those roles much quicker than those without. Your DS needs to broaden his job search

GrBH · 20/05/2024 18:50

I work in an investment bank and we are actively trying to recruit folks with a diversity lens - ie not necessarily in top unis / top school backgrounds.. There are also very very few places to go around and there is fierce competition.

honestly investment banking isn’t the best ever career path - there is lots available within wider financial services. In my experience investment banking can be a pretty toxic place to work and I’d recommend looking more broadly in FS

Xenia · 20/05/2024 19:01

It is a hugely competitive area. Essentially it is market forces - for the jobs with the very highest salaries London which is one of the biggest financial services markets on the planet at a time when the UK has its highest immigration ever (740,000 a year net immigration) and highest population ever, has vast numbers of very very good top students applying for jobs and many want the jobs with the highest pay. Although my sons qualified as solicitors earlier this year (as did my daughters before then and I am a lawyer too) so not banking, I have also seen second hand the market that their friends are up against for financial services and banking jobs. Even back in my day I had to apply to 139 law firms and have 25 interviews before getting my first job and today is no easier for these top London law jobs, never mind banking.

However some people apply for many fewer and still get through.

People have all kinds of views on who gets jobs depending on their own position - eg white and male and private school and you may be bottom of the pile for some HR people - that could be completely untrue but it can be accurate in some places where they are trying very very hard to improve diversity in terms of skin colour or having more women - about 60% of lawyers at the bottom end are women and some law firms do not show a single white male on their recruitment websites. Conversely others will argue the opposite - discrimination against people who are not white or went to a sink school in my native NE England. Instead the reality will be somewhere in the middle - that if you are very good and have good exam grades and do well on things like the maths tests for banking or group exercises with others for lawyers or whatever then you will be in with a chance. So it is best to put any negative attitudes to one side and just keep applying and also consider not so high paid firms and work your way up later if needs be as everyone has to start somewhere. Some lawyers now work a year or two as a paralegal after their law degree before securing a training place.

I remember one of my son's friends at Bristol getting a IB internship and he was really pleased at the time and had put in a lot of work to get it.

Law has very similar masses and masses of very time consuming hoops through which to go. Even for my son to get his solicitor job in-house earlier this year he had 4 interviews once having done the application form and covering letter. Applicants to train at law firms have to go through huge amounts of time just to get considered. I feel it has all gone too far in the drive to try to be fair to everyone whereas if people just sent in a CV and cover letter and then had 2 interviews it would be fairer on their time.

shivvametimbas · 20/05/2024 20:59

My DS is doing a similar degree (econ & stats) at a similar uni and has got an internship for this simmer. He wasn't interested in investment banking. He applied to medium sized companies - data science, quantitative analysis or actuarial. He got one interview from 12 applications before he was lucky enough to get the job. I said to him at the time that your first graduate job chooses you rather than the other way round, so just keep trying.

Who knows whether the internship will lead to something longer term, but I certainly wouldn't write off graduate jobs on the basis of not getting an internship.

blue345 · 20/05/2024 21:21

I worked in IB and as PPs have said, it's brutal and ridiculously long hours.

My son has a management consultancy internship this summer and had one offer from over 30 applications with multiple stages. I feel for the kids, it's almost a full time job applying.

I can't speak for other areas of IB but for corporate finance (M&A advisory), most people in my department were qualified lawyers or accountants and made the move over 3-4 years after uni. Most of my peer group from a big four went into IB as soon as they'd got their ACAs. The straight in grads felt at a disadvantage and were worked even more like a dog.

So I'd cast the net a bit wider and try not to worry too much as there are a number of later routes into it. And he might find he prefers one of the stepping stone but still well paid careers more in any case.

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OneGreenPoet · 20/05/2024 21:41

As PP have said there are other ways into investment banking OP, like corporate finance at a Big4 firm. Investment banking as a graduate role is very difficult to get. The easiest way is a spring week, then summer internship. Most graduate roles (if any) are usually taken by international students who do banking internships in their own country! If you're foreign, use this to you advantage.

@blue345 I went to LSE and most of my IB mates left after a few years, going into business development, management consulting and similar roles 🤣

So there's certainly lots of room to get in as an experienced hire!

Bear in mind that it's common for the investment banking intake to be tiny, single digits with 20+ people hired for other graduate roles like finance, corporate banking, etc.

Nothing to do with visa changes etc though. If your application is accepted you're considered equally, the only difference for international candidates is that you need apply for a skilled worker visa once you get an offer.

Also, your son seems to be easily swayed by his peers. Insisting on investment banking, doing a Master's if he can't get a graduate role...

It's perfectly fine to apply after graduation if he's going to have the right to work in the UK. It's OK to land a role a couple of years after graduation. Also, he can always get a direct entry job and use the experience to apply for graduate schemes, most acceptable people 2 years out of university.

Again, as a former LSE student the mass panic about getting a plum graduate role was insane. I understand it for international students who had taken loans to study here, banking on a well paid grad role to pay it off - and no time after graduation allowed to find a job ( before the graduate route visa was introduced).

But for your son? That's just silly.

TheHouseofGirth · 21/05/2024 09:40

Thank you all for your advice. I totally agree he needs to cast his net wider, and he sees the wisdom of that too, now! I believe he did apply for some other companies , but again, was unsuccessful. Yes, it is a full time job applying.

I totally agree IB seems to be toxic and with ridiculously long hours, so maybe this is a wake-up call for him.

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