Investment banks make for an inseparable part of a country’s economy and the financial markets. They help their clients grow wealth by investing big chunks of money into the financial markets on their behalf, thereby generating returns for them. Investment bankers are considered the experts of the financial trade markets, and hence, wealthy individuals and corporate firms take their valuable advice before investing money into the much risky stock markets. But, here in this article, we will be talking about the skill-needs of an aspiring investment banker. As a vital tip to building an illustrious career in banking, we would recommend enrolling in an industry-relevant investment banking certification today.
The Exorbitant Revenues Investment Banking Industry Generates
As per a Globenewswire study, the worldwide investment banking revenues are forecasted to fall off from USD 111.3 billion recorded in 2019, to USD 109 billion by the end of 2020. It will result in a negative CAGR (compound annual growth rate) of 2.1%. The reason for the said decline being the economic slowdown because of the emergence of the pandemic. The same study concluded that once the COVID-led pandemic ends, the investment banking revenues will revive, and the CAGR in 2021 will rise to 6%, and as a result of the same, banking industry revenues will surge to a whopping $127.7 billion by 2023.
Now, let’s move on to our core topic for the article, i.e. the skill requisites to build a rewarding career in investment banking.
Top 5 Skills a Prospective Banker Must Possess
#1. Analytical Skills: Investment banking is one such business domain that demands of you an expertise into analytical skills. You have to be good at numbers and quantitative analytics. Bankers are typically needed to present in-depth analysis of business strategies, and many a times, are required to explain on a detailed report about the investment opportunities available in the financial markets. There is a lot of statistics and numbers involved in such presentations that you need to explain to the stakeholders and the higher management.
#2. Communication Skills: It’s quite evident that communication skills are going to come into play every single time you present a report full of statistics and numbers before your senior management, or the stakeholders. As a potential investment banker, you must possess the capability to persuade the prospective clients, and thereby sell an idea.
#3. The Ability to Network Effectively: Having a strong gasp in the networking capabilities is a mandate in the world of investment banking to succeed and climb the career ladder fast. Good networking skills can help you immensely in finding and cracking the best investment opportunities available in the financial markets at any given point in time. Moreover, you always have a better idea of the ongoing business trends and the current market conditions if you have a great industry-wide network available to you at your disposal.
#4. Expertise at Offering Apt Financial Advisory: As an investment banker, you must be able to analyse financial statements and balance sheets of a corporation, or an individual, with a great degree of accuracy and precision. This way, you will be able to offer an apt financial advice to your clients while they are in the process of making their biggest investments in the highly volatile financial markets.
#5. Financial Modeling: Investment banking professionals are more often than not, needed to draft financial models for their clients, basis which, their business strategy is developed. And hence, bankers must be able to create and develop varied kinds of financial models. Apart from that, they must also be particularly good at leveraging the platforms/applications used to execute financial modelling, such as VBA and Microsoft Excel.
We hope the article will help aspiring bankers across the globe to get some sort of guidance in relation to shaping a career in investment banking.