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A Detailed Guide On The Typical Investment Banking Hierarchy

Investment Banking is a specialized division of the financial system in any investment bank guiding public and private institutes and organizations. Any organization or individual can grow successfully only when their profit and loss accounts have more assets than liabilities. By providing customized financial services to the above-mentioned bodies, investment banking has become an integral part of the global financial system. It is a fast-paced dynamic industry suitable for professionals who are ready and motivated to work for long hours, giving their 100% taking a task and completing it within a given period. This article will be your comprehensive guide on the Investment Banking Hierarchy. 

Investment Banking Hierarchy

The Primary Activities of the Professionals in the Investment Banking Hierarchy Are :

Underwriting:

It is one of the important functions an individuals or organizations take risk which is associated with any investment or any loan instead of a premium. They are part of the banking, insurance or stock market. In simple terms, it is a process in which a lender decides whether an applicant is eligible for any loan or not.

Mergers & Acquisitions:

It is a process where two organizations are combined into one entity. A bigger and more profitable organizational body merges and acquire smaller organization making less or no profits in business. Here investment bank plays an essential role by advising these institutes on mergers and acquisition and helping them negotiate and execute these transactions.

Advisory Services:

Providing financial advisory services to its clients which includes strategic advice on financial transactions, risk management and capital structure is a core role of Investment Banking.

Asset Management:

It is a process of managing the wealth portfolio of an individual or organization daily. It is usually managed by an investment manager or a relationship manager responsible for managing the wealth portfolio of the clients assigned to them. The three main asset types are:

  • Equities
  • Bonds
  • Cash or money market instruments

Trading and Sales:

The sales team work with various intuitional clients to provide them with trading insights while these investment banks are involved in trading financial instruments such as stocks, bonds, derivatives and equities.

Research:

The full history of a company through deep research about its profit and loss is a core role of an investment bank to suggest to its clients and give them valuable information about the company to help them proceed further in their investment decisions.

Risk Management:

It is a process to analyse, evaluate and expose risk and to monitor risk control to mitigate the risk loss. This risk is due to various sources such as:

Legal liabilities

Financial Uncertainties

Technology issues

Strategic management

Natural disasters

Capital Markets:

Issuance and trading markets of securities in different markets are known as capital markets. It also includes initial public offerings (IPO).

Private Banking:

Some of the banks provide a private banking system that includes customized financial services and advice to some of the high net-worth individuals.  Wealth management is a holistic approach towards managing clients’ financial needs and goals.

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 Investment Banking Hierarchy are as follows:

1. Analyst:

An analyst is responsible for conducting market research, financial modelling and valuation of an organization. They are mostly graduates who passed out from any university with the required minimum percentage of marks and are entry-level individuals in the Investment Banking Hierarchy. Their job responsibilities include day to day execution of deals and are often expected to work for long hours.

2. Associates:

An associate is a higher designation and their role includes, managing analysts, interacting with clients and handling the complete deal transactions. They are the face of an organization and the reputation and image of any organization depend on the associate’s way of managing and working with clients. Therefore, they are educationally well qualified, hired from Top MBA universities, or have a few years of working experience. Their core job role involves client presentation and contribution to deal execution.

3. Vice President:

Vice Presidents are mid-level professionals, with several years of experience in the same firm or related industry. A Vice president is responsible for the overall success of the transactions and plays the important role of a leader, leading the entire team towards success. He acts as a bridge between different levels of employees focusing on the successful completion of the deal.

4. Director/ Executive Director:

They are more often involved in business development. This level is typically below Managing Director, however, it is to be noted that different organization has different names and titles for this position. They are involved in the bigger organizational deals that include client management, leading multiple dreams and planning strategies for the closure of high-net value deals.

5. Managing Director/ Partner:

Managing directors are also Partners in some firms with some stakes in the firm. They are senior-level professionals, responsible for the overall success and profitability of their firm. Client relationship, business development and strategic direction of the business are their core job role responsibilities.

6. Chief Financial Officer:

They are the professionals responsible for managing the company’s financial strategy. The CFO directly reports to the CEOs and is important in the financial decision-making, company’s investments, money management and capital structure for long-term business strategy.

Educational Qualification Required for All the Designations That Are Part of    

 Investment Banking Hierarchy:

A bachelor’s degree, A master’s degree or a professional accounting certificate like a CMA.

1.   IIM SKILLS-

IIM Skills is one of the leading institutes and is globally recognized for its advanced and skilled courses that highly trained industry experts prepare. The courses are designed in such a way to meet the standards of market requirements helping its students to excel in their career growth.

Course Name:

Investment Banking Course

Highlights Of The Course :

  • 3 Months of online Investment Banking Course
  • 70+ Hours of lecture ( 50+ Hours of training and 20+ Hours of doubt solving)
  • Pay in 7 Interest-Free EMI
  • 100+ Hours of Practical Assignments
  • 1 Month guaranteed internship | 100% job support
  • LinkedIn profile building
  • Mock Interview Preparation
  • Lifetime Support | Capstone Projects | Resume & Interview Preparation
  • Receive a certificate from IIM Skills which is recognized by MSME
  • Students get access to the recorded videos, course and materials. They also get the opportunity to attend classes from anywhere.
Module 1MS PowerPointModule 5Technicals of Investment Banking
Module 2MS ExcelModule 6Different Marketing Collaterals
Module 3Financial System and MarketModule 7Technicals of Financial Modeling
Module 4Derivatives MarketModule 8Business Valuation

Benefits of Doing the Course From IIM SKILLS and Get Hired by Some Top Investment Banking Companies :

  • Anytime, Anywhere Access
  • Super Interactive Session
  • Flexible scheduling
  • Expert Faculty
  • Learning Resources
  • Master certification
  • Comprehensive Courseware
  • Internship and Placement Support
  • Complimentary Services

Module 1- PowerPoint

  • Introduction to MS PowerPoint and ribbon
  • Keyboard shortcuts and their importance
  • Creating, Managing and designing slides
  • Adding transitions and animations
  • Formatting by using themes and colour schemes
  • Creating the slide master
  • Inserting pictures, and links and editing them
  • Working on illustrations and shapes
  • Building graph bars like line charts, combo charts, football fields, scatter plots, histograms, pie charts, waterfalls, stacked, and column chart

Module 2- MS EXCEL (8 Hours)

  • Introduction to MS Excel
  • Keyboard shortcuts and their importance
  • Regular use of functions like concentrate, and their combination among themselves
  • Rules of conditional formatting
  • Font and Number Formatting
  • Concept of cells, rows and columns
  • Validation and using Excel data, functions as well and formulas
  • Table functions and dynamic arrays
  • Introduction to Micros
  • Creating different types of charts, histograms, Pie charts, waterfalls, stacked column chart
  • Sparklines
  • Sensitivity analysis using Data tables
  • Dynamic dashboards
  • Text functions like find and replace
  • Text to columns functions like delimit and flash fill
  • Iterative calculations and circular referencing
  • Analysis using Scenario Manager and Data Table

Module 3- Financial System

  • Basics of Financial System
  • Different kinds of financial markets, capital markets and money market
  • Market participants and regulators
  • Stock exchange and Financial centres
  • Equity and preference shares
  • Understanding of long and short positions
  • Meaning of depository receipts
  • Characteristics and types of bonds
  • Meaning and concepts of bond price and yield
  • Yield to maturity
  • Forex and its features
  • Quotes and Trades

Module 4- Derivatives Market (2-3 Hours)

  • Introduction to derivatives
  • Forward, future and options
  • Discussion of call and options
  • To understand the types of pricing in the derivative market
  • Concept of swaps and its types
  • Meaning of Speculation and Hedging
  • Overview of credit default swaps

Module 5- Technical of Investment Banking

  • Overview of Investment Banking
  • Role of Investment Bankers
  • Types of Investment Banks (Bulge, Mid and Boutique)
  • Understanding of business through its buy and sell-side
  • Concepts of Mergers and Acquisition and Capital raise
  • Vertical and Horizontal Mergers
  • A sell-side life cycle
  • Concept of due diligence
  • Different funding stages
  • Concept of underwriting and building approach
  • Overview of Greenshoe option
  • Understanding of corporate restructuring and turnaround

Module 6- Different Marketing Collaterals (6-8 Hours)

  • Buyers list or Investors list
  • Non-disclosure agreement (NDA)
  • Pitchbook/ Pitch deck
  • Teaser
  • Confidential Information Memorandum
  • Financial Models
  • Financial modelling practices and error tracking

Module 7- Business Valuation (4 Hours)

  • Difference between GPC and GTM
  • Difference between deal and transaction value
  • Criteria to screen peers
  • Valuation multiples to be used
  • Calculation of enterprise value
  • The ideal period to focus on last twelve months (LMT), the Next twelve months (NMT), historical years and projected years
  • Concepts of controlling premium
  • NAV approach for valuation
  • Relevance of the approach
  • Concepts of pre-money and post-money valuation
  • Presentation of valuation output
  • Blended valuation presented through the football field
  • Concepts of leveraged and unleveraged Beta

Other Professional Courses from IIM SKILLS

Contact Details:

+919580740740, [email protected]

Course Fees: INR 39,900 + 18% GST

2.   The Wall Street School-

The Wall Street School is a well-known and well-reputed leading Institute for Investment Banking courses. It has both an offline and online presence.

Highlights of the Course are:  

  • Practical training for the participants
  • The training is led by instructors who have worked with significant

Investment banks.

  • Training with real case studies and material.
  • Pay only 40% of the fees on the enrolment and 60% after the successful
  • placement.
  • Transparency between the participants and the team

The Modules Covered in This Course Are: 

Module 1- Essential to Intermediate Excel: 

  • Usage of the mouse in Excel
  • Sorting data to use advanced filters
  • Cell freeze, row freeze and column freeze
  • Using Excel and making the data look meatier
  • Linkages used for financial modelling
  • Simple Excel formulas
  • Match function
  • CAGR Calculation
  • Transpose function
  • Usage of the IF function
  • Table function
  • Pivot function
  • IRR Calculation
  • Cell referencing
  • Interest function as EMI calculator
  • Sum if, Count if, Sumifs
  • Sum product functions
  • Multiple usage of Vlook functions.

Module 2 Advanced Excel and PowerPoint:

The focus is to effectively and efficiently utilise Microsoft Excel for data analysis.

  • Offset function
  • Sensitivity Analysis using different ways
  • Iterative Calculations. How to negate it
  • Using Excel for Statistical Analysis
  • How to summarise data from sheets into a single sheet using an indirect function
  • Charting

Module 3- Basic Finance Concepts: 

Basic financial concepts are essential in mastering any financial and valuation analysis. It covers:

  • 3step and 5step Dupont Analysis
  • Safety analysis and Breakeven point analysis

Module 4-Feasibility Study/Business Modelling:

  • Benefits of using Net Present Value to calculate the finances
  • Using different approaches like the lowest common denominator and the value of projects
  • Calculation of free cash flow to firm and free cash flows

Module-5

You learn how to build a detailed trading comp right from selecting peers to analysing the final output.

The Following Highlights of These Points Are:

  • Impact on convertible securities and convertible preference shares.
  • Possible reasons for why different companies in the same sector are trading at different multiples and how to analyse those differences before jumping to the conclusions that a particular stock is undervalued or overvalued
  • Role of multiples in IPO valuation
  • Running regression analysis on multiple

Module 6- Discounted Cash Flow Valuation:

  • Idle projection period for the target company
  • How to calculate WACC

Module 7- Merger Model: 

  • How to factor synergies in the pro forma earnings of new companies after the acquisition
  • Everything about the M&A Process
  • Why we need to learn PowerPoint
  • Basics of PowerPoint
  • Learning Letter of Interest
  • Learning Letter of Intent full
  • Learning Merger of Model Basics
  • Merger Model Files
  • M&A Notes

Module 9- Leveraged Buyout:

  • LBO Model (Valuation)
  • LBO-Transaction assumption
  • LBO-Debt assumptions
  • LBO- Goodwill calculation
  • LBO- Closing Balance Sheet
  • LBO- Income Statement
  • LBO- Balance Sheet
  • LBO- CFS
  • LBO- Key metrics
  • LBO Files

Course Duration:

  • 6 Weeks / 180+ Hours /Mon-Fri/ Rs 45000+GST
  • 2.5 Month weekend/ 120 Hours/ Sat-Sun/ Rs 42000+GST

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3.   BSE INSTITUTE-

BSE Institute offers multiple world-class courses related to financial markets to guide their students who are interested in upgrading their skills and are up to the market standards. BSE offers an online Investment Banking course for seven months and offers a Master’s program from Mumbai University and PG Certification Programs from many International Universities.

Some Of The Preferred Career Domains are:

Investment Banking can be a rewarding career if you like figures, have a nag of dealing with a client on a day-to-day basis and help them reach their financial goals. It is a high-demand job with multiple possibilities for advancement.

Private Equity Associate:

They are professionals working in the field of Private Equity with a strong background in finance and are responsible for Mergers & Acquisition. Raising capital and using it to acquire or invest in companies to generate higher return values.

Mergers & Acquisition:

Merger and Acquisition is a process of combining two companies into a single entity. In this process, one company with high turnover buys another company and becomes one company.

Risk Management:

It is a process of identifying and evaluating risk. The goal of risk management is to understand and eliminate all the risks. This tool helps organizations to recognize problems and reduce risk by making informed decisions.

IPO:

Initial Public offerings are a process in which a Private company is acquired by a Public company by sharing its shares with the public for the first time. In this process, the existing shareholders sell their shares to the public.

Highlights Of The Program:

World-class practitioners are appointed as the faculty who have intensive knowledge of successful teaching methods

Each course is designed as per industry standards and by industry experts

Learning as per the requirements that benefits the students

Globally recognized certificates

This program will help you get through some of the International Universities

A large campus with many facilities to help you grow your network by meeting market merchants

It is a live virtual class and can be conducted from anywhere.

Academic Partners At BSE Institute:

  • Western Sydney University
  • University of Otago
  • HBSU
  • GLA University, Mathura
  • Techno India Group
  • UPES School Of Business
  • Rennes School Of Business
  • Indian Institute Of Technology, Madras
  • Lucens ET Ardens
  • Simon Fraser University
  • University of Canterbury
  • Gannon University
  • Ohio University
  • Techno India Group
  • Chitkara university, Punjab

Eligibility Criteria:

  • Graduate from any stream is eligible for the course
  • Education from any recognized university is applicable
  • Keeping working professionals in mind this program is designed to help them
  • Students in their final year can also pursue this course

Syllabus included in this Course are:

 Financial Market includes:

  • Financial System
  • Investment Banking
  • Equity
  • Debt
  • Securitization
  • Money Market
  • Foreign Exchange
  • Commodity Markets
  • Derivatives

Investment Banking includes:

  • Investment Banking
  • Trade Lifecycle
  • Reference Data Management
  • Global Security Operations and Settlements
  • Corporate Actions
  • Collateral Management
  • Reconciliation
  • Assets management

Risk Management:

  • Risk Management
  • DFAST
  • CAR
  • Recovery and Resolution Plan
  • Introduction to Regulators

Contact Details: 1800 22 9030

4.    IIM Kozhikode

Indian Institute of Management Kozhikode is a business school in Calicut, Kerela. The government of India introduced it in 1996. It is a well-known college and one of the best colleges for Investment banking courses in India.

Their program aims to provide the participants with the necessary tools that Investment Banks use.

Highlights of the Programme are:

  • You will be awarded with the Certificate from IIM KOZHIKODE after completing the course.
  • Advanced-level technology
  • Hands-on Practical, Modelling, Simulation and Projects
  • two days in campus immersion

Eligibility for the Course:

  • Graduate or Diploma Holders from any recognized university (UGC/AICTE/DEC/AIU/State Government/recognized international universities) in any discipline.
  • The candidate should have a few years of work experience

Modules of the Programme are:

  • Financial Accounting and Analysis
  • Financial Reporting, Analysis and Business Valuation
  • Advanced Valuation Techniques
  • Financial Modelling (Spreadsheet modelling for Finance)
  • Financial Management
  • Investments Consulting and Portfolio Management
  • Financial Economics
  • Merger and Acquisitions
  • Restructuring
  • Option, Future, and Derivate
  • Capstone Project
  • Understanding the fundraising and valuation methodologies

Course Fees: INR 300,000 +GST

5.   IIM Ranchi-

IIM Ranchi provides you with a course on Investment Banking that helps its students understand the capital markets domain.

Highlights Of The Course:

  • 80+ Live sessions
  • Certification from IIM Ranchi
  • The campus at IIM Ranchi for 2 days
  • Career services by IntelliPaat
  • 24*7 Support
  • No-cost EMI option

Who Can Apply for This Online Investment Banking Course?

  • Individuals with bachelor’s degrees and a strong desire to work in Investment Banking
  • Graduates who want to pursue a career in Investment Banking with a finance background and banking sectors
  • Learners graduating with a BA in finance and economics
  • Graduates with BBA, and MBA
  • Any graduates can apply for this program

In an Investment Banking Hierarchy, What Roles Can a Professionals Play?

  • Financial Advisor
  • Investment Manager
  • Capital Market Operation
  • Associate in Investment Banking
  • Risk Manager
  • Financial Analyst

Syllabus of the Course:

Module 1- MS Excel

Module 2- Financial Markets Innovation and forms of business organizations

Module 3- New business capital

Module 4- Quantitative and computational techniques for capital markets

Module 5- Market Operations and Trading

Module 6- Sources of financial information

Module 7- Fixed Income Market and Regulatory Income

Module 8- Equity Valuation, Business Valuation & Strategic Investments

Module 9- Portfolio Investments

Course Fees: INR 1,25,000

Course Duration: 9 Months

FAQs About Investment Banking Hierarchy?

Q. What is the Investment Banking Hierarchy?

Investment Banking Hierarchy is a structural hierarchy of investment banking that depends on factors like total number of experience, education and many more.

Q. What is the highest level in the Investment Banking Hierarchy?

The highest level in the investment Banking Hierarchy is the head Finance Officer (CFO) who directly reports to the Chief Executive Officer (CEO).

Q. What are the disadvantages of an Investment Banking Hierarchy?

The disadvantages of an Investment Banking Hierarchy are that at any level from top to bottom everyone is struggling with their issue like long working hours, no work-life balance, and intense pressure. It has a highly competitive industry known for high turnover rates.

Conclusion About Investment Banking Hierarchy:

The investment Banking Hierarchy is a structured system that defines the roles and responsibilities of professionals within the organization and industry. The Investment Banking Hierarchy allows professionals to progress in their careers while taking on challenging roles.

 

 

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