Operational investment banking is competitive and as well as strong academic qualifications you'll need work experience in the financial sector
As an operational investment banker, you’ll be responsible for the processing, clearing and settlement of the financial transactions made at an investment bank or management firm.
In the operations division, also known as the back office, you'll provide support to the client-facing departments, such as trading, corporate finance and corporate banking - sometimes known as the front office.
The front office generates business for the bank, and operations ensure that the business is administered in an efficient, controlled, risk-free and timely manner. You'll ensure that products, services and money change hands how and when they're supposed to and that each transaction is cleared, settled and reconciled according to regulatory requirements.
You'll also be involved in developing and implementing new systems in order to maximise efficiency and profitability for the bank.
Operations covers a range of activities. Following the buying and selling of financial products and services by the bank, operations staff ensure that each transaction is:
- cleared - funds and financial products have moved from seller to buyer
- settled - ownership has been confirmed efficiently and accurately
- reconciled - transactions have been correctly documented and reported.
The structure of departments varies from bank to bank, but you’ll typically need to:
- run processes to clear and settle transactions
- reconcile systems by checking that data flows from the revenue-generating front office to the operations systems (operations control)
- monitor the activity and reports of daily transactions
- investigate breaks in the cash account within an investment bank
- liaise with clients regarding transaction settlements, as and when required
- troubleshoot system problems.
As a manager of an operations team, you'll:
- act as an interface with other divisions of the bank, for example, liaising with traders and ensuring all issues are resolved in a timely and efficient manner
- recruit, train and coach team members
- organise team meetings, manage team members and have responsibility for individual and team appraisals
- ensure client protection rules are adhered to
- make sure that processes are constantly improving, and participate in step-change improvement projects
- manage projects such as analysing a system, identifying and specifying developments and improvements, and coordinating the testing and implementation of new systems.
- Starting salaries in a trainee role can be in the region of £25,000. As you progress this can rise to £55,000 to £69,000. Benefits and bonuses are often included on top of the base salary.
- In senior roles salaries of £69,000 to £95,000 can be achieved.
- The best paid operations staff earn in excess of £125,000, plus benefits and bonus.
Salaries vary widely depending on your role, location and experience. Salaries in operations do not reach the levels of the revenue-generating front office roles, such as trading, but still remain high.
Remuneration packages in investment banks often include benefits such as health insurance, life assurance and subsidised gym membership, plus discretionary annual bonuses (based on individual and company performance).
Income figures are intended as a guide only.
Investment banks have a reputation for long working hours. While this is true for divisions such as corporate finance, working hours in operations tend to be more regular. However, longer hours and some weekend work may be necessary to meet deadlines. You may need to work shifts to support front-end teams working on financial transactions in multiple time zones.
What to expect
- The job is mostly office based.
- Women are underrepresented in senior management positions. There are, however, initiatives such as Women in Banking & Finance that aim to encourage the potential of women in this career area. There are also a range of events, schemes and internships aimed at women.
- Most jobs are available in financial centres, such as London, and other major UK and international cities. There has been a tendency to move operation functions to lower-cost areas in the UK like Bournemouth and Glasgow, and offshore to countries such as India, Poland and Hungary.
- Job availability tends to fluctuate due to economic conditions. There are no opportunities for self-employment, though consultants may be used for major improvement projects.
- The working environment may be demanding with tight deadlines, but the role offers variety and challenge. It is sometimes necessary to adjust home and social life to meet the priorities of the job.
- There may be travel involved to some of the bank's other sites overseas, but travel opportunities are limited in operations, and will depend on the department or product.
To enter a graduate-level job in operations, you'll need at least a 2:1 degree as well as strong academic and extracurricular achievements. Formal graduate schemes are competitive, and some employers require a first class degree.
Entry into operations tends to be either as an administrator or as a graduate trainee, where you'll normally be known as an analyst.
Typically, banks will consider graduates from any discipline but degrees that may be particularly useful include:
- accounting and finance
- business management/business studies
- international business
You won’t be at a disadvantage if you have a non-related degree but you will need to show an understanding of, and keen interest in, the business.
There are some degree-level apprenticeships available, combining paid and part-time study in investment banking with major banks such as J.P. Morgan. For more information, see Top UK banking apprenticeships.
Those with a Masters of Business Administration (MBA) and certain other postgraduate degrees, plus two to five years of relevant work experience, may be able to apply for a higher-level training programme as associates, but it's worth noting that these programmes are usually aligned to front office roles, such as corporate investment banker. Search for MBA courses.
Each bank will be looking for slightly different characteristics, but generally you'll need to show evidence of the following:
- the potential to achieve a leadership position
- the ability to work well in a team
- excellent communication and interpersonal skills, especially in negotiation, persuading and influencing others
- IT skills
- excellent numeracy and analytical skills
- a creative and innovative approach to problem solving
- consistency, accuracy and attention to detail
- excellent organisational and time management skills
- passion and self-motivation
- resilience and determination and the ability to work well under pressure
- personal integrity
- the ability to grasp new concepts and adapt quickly to changing circumstances.
Fluency in another language is also useful as many banks have international offices.
To gain an interview for a graduate programme you'll need a full CV. This could include experience from:
- an internship at an investment bank
- positions of responsibility in societies or sport teams
- part-time work alongside your degree
- evidence of sustained interest in finance, such as managing a shadow portfolio of investments.
Many of the large investment banks provide internships over the summer, that typically last 10 to 12 weeks and are aimed at students in their penultimate year. If you do well during an internship, you may be considered for the organisation's graduate training scheme.
Some firms also offer shorter internships available in the spring, which you can usually apply for when you’re in the first year of your degree. Check the websites of the investment banks you're interested in for further details and research the sector thoroughly.
Networking with employers is also important to help build up a list of contacts.
Find out more about the different kinds of work experience and internships that are available.
Operations professionals are recruited by investment banks and private equity fund institutions.
Investment banks come in many shapes and sizes, from smaller or niche players, such as Lazard and Rothschild &Co, to global organisations, such as:
- Black Rock
- Credit Suisse
- Deutsche Bank
- Goldman Sachs
- J.P. Morgan.
Graduate scheme deadlines vary so check on company websites. It is advisable to apply as soon as possible as they often interview before the closing date is reached, and recruit on an on-going basis.
The banking sector is a volatile one and investment banks are affected by economic cycles, which have a knock-on effect on graduate recruitment.
London and New York have dominated financial employment in the last few decades, but increased growth in emerging markets such as Russia and China have led to other financial centres growing around the world.
Look for job vacancies at:
You can also check the national and financial press, such as the Financial Times, Guardian Jobs and The Times Jobs, as well as websites of individual banks.
You will be trained on the systems and products that your department supports. As these change regularly, all employees will undergo training at least yearly.
If you're on a graduate development programme you'll undergo a structured set of training courses and coaching sessions to develop the knowledge, skills and experience needed to become a manager, typically over a two-year period.
Sponsorship towards professional qualifications is often offered to those identified with the potential to progress up the ranks. The Chartered Institute for Securities & Investment (CISI) provides a range of qualifications for the financial services industry, some of which can lead to chartered status. Qualifications include:
- Investment Operations Certificate (IOC)
- Certificate in Managing Operational Risk in Financial Institutions
- Advanced Certificate in Global Securities Operations
- Diploma in Investment Operations.
See the full list of CISI qualifications.
There are various other professional bodies that offer training and support, such as the:
You will typically start out as an analyst before moving into the role of associate after around three years. Career progression is influenced largely by your performance and you can move into roles with more responsibility as your career progresses.
You're likely to stay at associate level for a minimum of two years before moving into the role of vice president with responsibility for leading a team. Further promotions are to director/executive director and finally managing director. At the highest levels you will have responsibility for strategy and direction. Competition for roles, particularly at senior management level, is high.
There are also options to move into project management or into a specialist role such as IT or HR.