A global investment bank will handle literally millions of transactions throughout the day. The operations team keeps it all moving.
Operations will spread across all divisions of an investment bank: there’s a team for every division going! It’s part of the ‘back office’ of a bank, so not directly involved in generating capital, but that doesn’t mean to say that it isn’t an essential part of the business. Without a crew of incredibly switched on professionals, the bank could be at risk of running into trouble financially or legally, and could lose clients.
What goes on in operations?
You may think that as part of the bank’s back office, operations will pretty much be a ‘behind the scenes’ environment. Au contraire! There are professionals within operations who specialise in client management, so building a rapport with clients and ensuring their services are delivered to them swiftly and accurately is essential. They may work with new clients to the firm, giving them the right accounts etc. and conducting any due diligence work for any potential trades (to do with the accounting of the firm). Operations will support a client right through a trade to ensure the relevant payments and assets being traded are delivered accurately, securely and on time. Clients may also have queries about trading in a new market and the risks and fees associated with it; operations representatives will provide them with the answers they need.
Operations professionals can also focus on streamlining and improving the firm’s processes to make them more efficient, for example working on projects to automate a certain process. This requires creativity and top notch team work skills.
Risk management also forms part of the operations team in an investment bank. Risk management experts have to be in frequent correspondence with industry regulators and provides research and guidance to ensure the bank doesn’t run into risk that could seriously compromise its position, finances or reputation. Some people in this area focus on the regulatory aspect of things; ensuring that the firm upholds all essential regulator requirements.
The route into operations…
Summer internships are the first wrung on the ladder for the majority of operations roles within an investment bank. This will give you an insight into the way things work, a chance to develop some skills, and an idea of the kinds of projects you can expect working in this area. Remember; it’s notoriously difficult to get a graduate position with an investment bank if you haven’t already completed an internship – a large number of their hires come through this process!
Once you’ve aced the interview process and been offered a position with the bank, you’ll usually join as an analyst. Many of the bulge bracket banks (the big players in the industry) have structured operations analyst programmes to provide the comprehensive training, experience and networking opportunities in the first few years of your career. It’s hard graft, but the majority of analysts get to take on considerable responsibility at an early stage.
After that, there is usually the opportunity to progress to associate level, at which you’ll take on even more responsibility. Senior roles tend to involve management and leadership, or being the go-to expert on a specialist area within operations.