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Investment Banking: The process by which money is raised. This money could be in the form of debt

(loans, bonds) or equity (IPOs or Private Equity placements). This money may be used for financing the

working capital, capital expenditures, dividend payouts, etc.This is what you would call "Execution".

Advisory, the process of advising client on structures and regulatory procedures with respect to raising

money is also one of the things that comprises IB.

Balance Sheet: When used in the context of "xyz firm has balance sheet support" (in the simplest sense)

means that the firm has the ability to lend money and has the amounts needed for the transaction. This

is very important, because a large balance sheet lends credibility to the investment bank raising the

money.

Bulge-Bracket (BB) Firms: Large, well-known and very well-respected firms operating in the upper end of

the market. They usually engage in transactions that exceed Rs. 2,500 million. Bulge Brackets in India

are not clearly defined but the internationals - JP Morgan, BofA-Merrill Lynch, SBI Caps, IL&FS; fit the

description. Internationally, the well-known Bulge's are JP Morgan, BofA-Merrill, Citi, UBS, Credit Suisse,

Barclays, et al

Boutique Firms: Firms operating in what is known as the SME (Small & Medium Enterprise) space. The

transactions are usually smaller than the BB's but are still able to gather enough fees to survive. There

are hundreds of boutique firms that clamour for fame in India - they are usually attached to securities

broking firms and exist in an attempt to ensure that institutional clients have access to securities broking

as well as corporate finance products under one roof.

Middle-Market Firms: Usually firms that operate with companies that have transaction sizes that fall in the

gray zone between BB's and Boutique firms.

Back-Office: The part of the IB process which provides transaction, research, reconciliation and number-crunching support for the bank. They usually work out of KPOs and work on processes as complex as

financial modelling. Hours are kind of fixed and not very demanding. Skill-set level is minimal compared

to the rest of the firm. Pay is better than most places but nothing "Investment-banking"-like... Usually

located in India or other developing countries with cheap labor and lots of smart people.

Middle-Office: Usually dealing in risk and having minimal client interaction. They ensure that the

investment bank's risk and compliance requirements are satisfied. Hours are either the same as or

somewhat worse than KPOs, but not by too much. Usually located physically in the same building as the

investment banking front-office. Money is pretty decent and fixed component of the salary is slightly

below the front-office.

Front-Office: Fee-generators. The "bankers" sit here - defined as the place with maximum client

interaction. Fixed component is pretty okay - but what boggles the mind is the bonuses.

Analyst: Undergraduate level support for the front-office. Not to be confused with back-office, these guys

are some of the best undergrad recruits on their campuses and are chosen for their ability to work like

crazy. They usually spend 3 years before being "encouraged" to go to business school. Those asked to

stay on are turned into Associates and do not require to go to business school. Analysts are not so

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popular in India; since MBAs come so cheap...

Associate: The post-MBA level bankers. The Associate designation is usually the start of the process to

reach MD. They usually handle work on client interactions and manage the Analysts.

Investment Bankers (in India): Usually CA's or MBA's. They work in either debt raising, equity raising orstructured finance (lending from their firm's balance sheet). Very rarely will you see a non-MBA / non-CA

in this business, unless they've moved in laterally from a bank job.

Investment Bankers (in the US): Usually MBA graduates (there are some undergrads who move from

Analyst directly to Associate after 3 years, but they're the best of the best).

The Hype:

The hype's all about the money. Investment bankers work crazy hours but get paid mega-bucks.

A first-year Associate at a bulge-bracket could earn (starting, including bonus) about Rs. 40-65 lacs in a

decent year in India.

A first-year Associate at a bulge-bracket could earn (starting, including bonus) about $ 300,000 - 400,000

(Rs. 1.35 - 1.8 crores) in a decent year in the US.

However, before the lure of the money begins to blind you, you must keep in mind that bankers work 85-

100 hour weeks on an average. That means over 15 hours a day / 7 days a week! Very often, you will

end up sleeping on the floor at your desk!

Based on this, or anything else, I would be happy to answer questions

Qualities that are looked for ideally:

1. The ability to be smart and presentable. This includes the way you dress yourself, communicate and

think. If you're sloppy in the manner in which you come across, have your hair in disarray, shirt with

stains / smells, etc, thats a definite no-no. I know this sounds silly, but trust me - investment banking is a

relationship business and you have to come across as someone who the client can look up to and trust

for the best quality services.

2. A strong sense and keen eye for numbers. This means you know your finance and accounting WELL.

No messing up. There is a saying about never being late or wrong in banking. But mistakes are worse

than being slightly late. So, you must have your technical skills really sharp.

3. A friendly and pleasing personality. A lot of banks say that you are being hired not as an Associate, but

as a future MD. This means you will be involved in bringing in business - which means you will need to

have cultivated relationships with clients and be on good terms with them. This would require you to

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have a personality that would allow you to gel well with them. Also a friendly personality is a must

because your colleague would not want to work with a prick for 17+ hours / day, right?

4. Love for the field within banking: Having a genuine interest in the financial work really helps. If you

don't love what you do - you will slack off, hate your job and act irresponsibly (have seen so much of

this!). This happens when you work purely for the money. Banking is an amazing career which teachesyou so much about the industry in a really short time frame. I love the industry because of this. If it were

just the money, staying on for more than a year would be impossible.

5. Strong MBA degree

6. The ability to work very very long hours and have little sleep