If you have big dreams and love to deal with large numbers then investment baking is the right choice. Being an investment banker, you help an organization in collecting and building decisions related to financial matters containing huge risks. Therefore, if this is the genre you want to select as your future career, all you need is a valid degree in commerce or finance background. Here we will provide you with detailed information about becoming an investment banker and the criteria for Investment Banking Salary received in the industry globally.

INVESTMENT BANKER SALARY-compressed

What is Investment Banking?

Investment banking is the most charming-attractive wing of banking which promises higher salaries along with a bright and promising career. After permitting Foreign Direct Investment (FDIs) in our country with numerous industrial and business-related rebates and packages, there is a flood of FIIs who are investing huge amounts in our country in almost all sectors.

Since our country has its own domestic demands and cheap labor along with the easy availability of skilled workers in abundance it’s easy and profitable to establish a new big venture in the services and manufacturing sector. Thus, creating a big scope for bigger projects for which the services of Investment bankers are essential.

Even in existing companies, and projects while investment is made by FIIs and pension funds, they take the assistance and advice of Investment banker to justify their investment and continuously watch on the safety of their investment and higher returns thereon. Thus, investment bankers are providing them, their valuable services broadly on:

  • Mergers and acquisition
  • Underwriting of new IPOS
  • Relationship managers with their clients and customers
  • Valuation of business and risk management

What are the Types of Investment Banking?

Investment bankers provide a range of services including underwriting, asset management, creating investment opportunities, and relevant research work. Broadly we can divide their services into 4 categories, which are explained below:

Corporate Finance:

They assist in raising financial capital by underwriting or acting as a client’s agent.

 Sales and Trading:

Investment bankers are working as clients to call institutional investors with opportunities.  Traders execute orders and advise clients to exit or enter positions.

 Equity Research:

To create investment opportunities for client’s investment bankers, perform analysis to prepare impressive reports for making decisions to buy, sell, or retain the investment.

Asset Management:

Management of funds is called asset Management.  They are investing in derivatives, stocks, fixed-income debts or stocks, and other related investments by analyzing the risk and reward by following the policies of the organization.

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What Are the Skills Needed to Be an Investment Banker?

When a bigger company needs to raise huge capital from the market, wants to invest its surplus capital, planning to have a merger or take-over, it approaches an investment banker for help. It is an exclusive part of the banking sector which provides financial services.

To fulfill the requirements of their client, an investment banker first needs to do a deep study regarding a company’s goals, financial health as well and capital needs followed by forming a strategy to find a suitable partner having the same requirements as its clients. To do that an investment banker is expected to be a multi-tasker and must possess a certain set of skills which are mentioned below:

Analytical Abilities:

Striking and conclusive decisions are based on scrutinized data and well-compiled statistics as per the company’s requirements and for risk analysis. He should be well aware of the market conditions before making a final decision.

Logical Approach Negotiation Skills:

While doing acquisitions, mergers, and IPO underwriting you have to ensure clients’ interest and to get handsome profit with logical and favorable terms.  If an investment banker is aware of the industrial trends and has better analytical and communication skills will make him a successful investment banker and prove to be an asset to the company.

Communication and Soft Skills:

Your communication skills should be such that it helps the company to communicate their ideas to interested clients, and existing customers and able to convince them also.  In the end company and client both should be happy.  Investment bankers must be capable of explaining complex terms and statistics to them.

Critical Thinking, Research, and Investment Advisory:

Investment banking revolves around financial data. They are bound to collect the latest news and developments in this field about you. The data is thoroughly studied and analyzed for future investment opportunities, and changes in the company’s policies if needed to avoid risk and increase the gain in the future.

Risk Management, High-stress Situations, and Problem-solving Abilities:

Investment banker has the responsibility to protect their clients from probable risks like share market volatility, Economies in trouble, and Companies in financial trouble. Any negative fluctuation gives the wrong signal to the investors.  Hence one should use all skills to provide timely and proper solutions to the impending and expected problems of the organisation.

What is the Scope of Investment Banking?

The scope for investment banking is excellent and extraordinary. Investment banking is a special branch that provides all important services to high net-worth projects and organizations, handling IPOs, mergers and acquisitions, fluctuation in currencies, and share markets including investment-related matters which shows the importance of investment bankers to those organizations.

This area is full of opportunities which are the most in-demand services. It has grown in our country after the arrival of FDIs and FIIs are making huge investments in all sectors and gaining popularity day by day year by year. Investment banking is a lucrative profession that not only provides better financial gains but also professional and personal growth, and development.

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What is the Basis for Investment Banking Salary?

Basis of Investment Banking Salary:

An Investment Banking Salary depends on many factors initially your academics, having completed the essential courses, your experience, your type of investment banker, and your performance.  All these factors will help an investment banker to negotiate the salary and incentive terms. The following are the requirements to become a good investment banker:

Qualification – Courses and certificates and experience:

  • Financial Modeling and valuation
  • CFA Chartered Financial Analysis
  • Masters in Finance

Professional track and background – having worked in prestigious and high-net-worth projects and institutions

Location of the project and sectors

Description of job

Other supporting skills are technical and soft skills

Role and Importance of Qualification in the Field of Investment Banker

All the Corporates and concerns go for the most qualified techs in their field. Such higher qualification justifies the deep understanding required in this sector to resolve complex issues in various fields.  Those who have the knowledge and ability to know the concept and requirements of the organization will implement the plan for ultimate success.

Well-versed With the Global Stock Market, Economies, and Their Fluctuations, and the Financial Sector:

 In investment banking, your qualification shows how smart and capable you are of handling the complex and volatile issues on the varied transactions in the stock market, international economies, economics, and their financial behavior. Only a certified person with the required degrees can manage the show in such a competent environment.

Financial Certification and Financial Modeling:

Financial qualification is an integral tool to help you in the preparation of all important statements like Profit and Loss, various required statements, various models required for financial planning, valuation of the company, and misc. reports required on a day-to-day basis. Based on these, one derives the health of the company, expectations of results, and outcomes.

Sound Knowledge of Financial Saga:

The stock market, business functions, and its cycle are very volatile hence an investment banker should be smart enough to know the business ups and downs, recessions and economic condition of the country, industry, and its organization which may affect the business, industry and finance therefore affect the business negatively.

Competency in Software and Use of Technology:

Investment bankers should have the ability to handle various software platforms that are common in use and essential to get the required information and data.

Common Financial and Technical Concepts:

Various popular terms and concepts are important to know the industry and take advantage of it. So, an investment banker is supposed to know all about IPOs, Bull and bear markets, derivatives, futures, M&A, and Call options especially all terms about the share market are important and must be known to him. Investment banking salary does not depend on one factor. The above additional skills and traits add a feather to their cap and increase their value and capacity as investment bankers.

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Let us Learn The Average Investment Banking Salary by Indian and Foreign Banks:

BANKS & MISC EXPERIENCE  PACKAGE
Indian banks 0-5 years RS.2.60 Lacs – Rs.06.00 Lacs
Foreign banks, Mutual funds, AND Pension funds 0-10 years RS.17.00 Lacs – Rs.20.00 Lacs
Centrum Capital 0-10 years RS.14.3 Lacs onwards
Motilal Oswal Financial Services 05 years onwards RS.20.70 Lacs
Ambit 05 years onwards RS.09.00 Lacs
Axis Capital 05 years onwards RS.14.00 Lacs
Rainmaker Group 10-20 years RS.40.50 Lacs
HDFC Bank 0-10 years RS.11.00 Lacs onwards varied in various cities of our country

Different Skills and Types of Investment Bankers’ Jobs Also Affect Their Salary. Their Present Effect is as follows:

Dealing And Expertise Percentage Of Salary Effect 
Merger & Acquisitions 73%
Investment Management 27%
Financial Analysis 18%
Banking 15%

Depending Upon the Above Activities There is a Huge Difference in the Average Salary of Different Organisations.

Organization Average Salary

 
Bank of America Rs.6.45 Lacs
Goldman Sachs Rs.41.50 Lacs

 

Investment Banking Salary Based On Different Factors

 

1. Investment Banking Salary Based on Hierarchy

Financial Analyst:

This designation pertains to newcomers. They provide required feedback, data collection for research, and various financial analyses.  They have all the skills to derive data needed for various research purposes as per requirement.  Their average pay ranges from Rs.2.00 Lacs P.A. to Rs.6.00 Lacs P.A. as per their experience and usefulness.

Business Analyst:

After acquiring the basics of financial analysis, a business analyst has to concentrate on project management and deriving business-related strategies. They help in business processes to improve and maintain profits and investments to improve business viability. Their average salary ranges from Rs.6.00 Lacs to Rs.8.00 Lacs based on experience and expertise.

Investment Banking Associate:

This is a further improved version of the financial analyst and business analyst. They discover investment opportunities and strategies with the help of processed data and also do operations management, financial modeling, risk monitoring, and scrutiny of financial analysis. This Investment banker’s salary ranges from Rs.7.00 Lacs to Rs.10.00 Lacs.

 

Finance Manager, Finance Director, Vice President:

They belong to a high caliber most experienced and well-qualified category. They are involved in all types of activities including relationship manager and policy making decisions. They assign various roles to various designations according to their roles.

They also attend to all aspects of advanced financial analysis, financial and accounting reporting, and all related matters for appropriate planning. Their average pay has no limit, depending on the size of the organization and their experience which ranges from Rs.10.00 Lacs to Rs.40.00 Lacs.

Generally, the Vice president category is the apex director who handles higher stake activities to protect the interest of the organization and steps to achieve the ultimate goal of the institution.

 

2. Investment Banking Salary Based on Comparison by National Average Salary (NAS)

Indian Cities Enjoying High Salary In % (Higher or Lower)
Kolkotta +130% Higher
Hyderabad +Higher than NAS
Delhi +Higher than NAS
Gurgaon +Higher than NAS
Ahmedabad +Higher than NAS
Mumbai +38.2% Higher than NAS
Bangalore +8% Higher than NAS
Uttar Pradesh -13.6% Less than the NAS
Pune -19 To 20% than the NAS
Chennai Less than the NAS lowest among big cities

 

 

3. Investment Banking Salary Company Wise

The size and stature of the company, global presence, total turnover, nature of activities, and profits decide the salary offered by the company. The table of salaries enjoyed by investment bankers in various organizations is as follows:

Organization Average Salary in INR (Rs.)  
J P Morgan 21.70 LACS
Morgan Stanley 15.20 LACS
UBS Investment 13.50 LACS
HSBC 11.00 LACS
IBM 7.10   LACS
Kotak Mahindra Bank 7.40   LACS
ICICI Bank 7.15   LACS
WIPRO 6.00   LACS

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4. Investment Banking Salary Qualification Wise

Qualification is the main criterion and most crucial for higher payouts and deciding salary in the Investment banking profession. Having higher education gives you better insight, easy to grasp the finer points of the industry/projects/organizations, and enables you to better execution of projects and discharge your overall responsibilities and challenges.

Your overall education confirms your abilities and proves a point that you are well aware of all the concepts relating to this profession and confidently meet the risks and fluctuations of the financial sector.

QUALIFICATION SALARY
Masters in finance or post-graduate degrees RS.16.00 LACS onwards
Undergraduate degrees or CFA etc RS.08.00 LACS onwards
Diploma or post-graduate diplomas RS.05.50 LACS onwards
Certificate courses RS.03.50 LACS onwards

 

 

5. Investment Banking Salary Skill-wise:

Investment banking also has various types of assignments and projects for which different type of financial modeling is required. To undertake such varied activities, one should have expertise and exposure in that particular field.

Apart from this technical and soft skills are also required which will define the salary of an investment banker. These respective popular skill-wise salaries are as follows:

Skills          Packages
Chartered Financial Analysis CFA RS.10.00 LACS
Financial Modelling/Planning RS.9.80   LACS
Investment Banking RS.7.00   LACS
Private Equity RS.6.25   LACS

 

6. Investment Banking Salary – Experience Wise:

Like education, experience is also all-important in determining their salaries.  If education is theory, then experience is practical for them to implement their ideas and concepts into reality.  Experience only enables you to get the right exposure, concepts clarity, and finer points of the financial sector.

It gives us the ability and strength to learn, perform, and execute the respective assignments as per the expectations of the organization to maximize their business and profits.

Experience gives you the confidence and competence to meet the crucial challenges in this field. Since they are dealing in high-profile value projects/transactions, they need to be capable and well-versed of all the actions/activities in those trades for which experience plays an instrumental role.  Experience-wise salary table is as follows:

Years Of Experience Average Package
0 – 5 years 03.00 – 08.00 Lacs Onwards
6 – 10 years 14.00 – 15.00 Lacs Onwards
11 – 15 years 18.00 – 20.00 Lacs Onwards
16 – 20 years 30.00 – 32.00 Lacs Onwards
20 years and above 40.00 lacs and above as per the nature of work and size of the company

 

 

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7. Investment Banking Salary Country Wise

Developed countries are far ahead of others in the use of technology and progressive approach hence they are heaven for new ventures, scientists, and researchers. Their mutual funds, banks, and pension funds are investing and offering various investment banking services globally and undertaking big projects even dealing with huge projects started by various government and their respective agencies.

Hence their exposure is big and their risk appetite is also more, which is why they hire the best available investment bankers worldwide who are proven and experienced to complete the task successfully and profitably. Generally, countries that have better and bigger industrialization can afford big salaries due to the big size of their organizations and worldwide exports and other activities.

The salary may differ in different countries due to the cost of living, if this is higher in that part of the world, they are bound to offer more salary accordingly. Geographical location and availability of skills in these fields may also affect the salaries and packages in respective countries.  The salaries offered in various advanced countries are furnished below:

Country     Salary In INR
Germany RS.79.00 LACS
United Kingdon RS.66.00 LACS
USA RS.59.00 LACS
Canada RS.58.00 LACS
Australia RS.53.00 LACS
Japan RS.43.00 LACS

 

8. Best Salary Packages for Freshers in Our Country and by Foreign Funds Institutions

To gain first-hand experience and better remuneration some banks and funds are the best places in this field of investment banking. Due to their varied activities and worldwide exposure and presence, freshers would like to join and work with them to acquire the best experience with highly skilled professionals globally.

  • Morgan Stanley
  • Accenture
  • UBM Bank
  • Barclays Bank
  • Ernst N Young
  • HSBC Bank
  • ICICI Bank
  • Tata Consultancy Services
  • Axis Bank

 

9. Designation-wise Investment Banking Salary in Different Countries

COUNTRIES US

(USD.)

 UK

(British Pound)

 Canada

(Canadian Dollar)

 UAE

(AED Dirham)

 
Analyst 135000 – 200000 80000 -110000 63000 313000
Associate 180000 – 220000 120000 – 220000 110000 368000
Vice president 220000 – 400000 250000 – 350000 140000 441000

 
Managing director 200000 – 1000000 1000000 and above 1000000 and above 1102000 and above

 

10. Investment Banking Salary in Top Most Foreign Banks N Funds Manager

Companies Average Minimum Maximum   (In Lacs)
Goldman Sach 21.00 10.00 35
JP Morgan 29.00 13 45

 
Morgan Stanley 13.50 06 51

To hire the best talent available, they are paying handsome salaries to retain them.

 

FAQs:

Q. What is investment banking?

The following tasks are being executed by investment bankers which shows their importance and utility:

  • Mergers and acquisition
  • Underwriting of new IPOS
  • Relationship managers with their clients and customers
  • Valuation of business and risk management

Investment banker helps different business setups to raise private or public funds through IPOs or debt. Preparations of financial models for mergers and acquisitions transactions.  To arrive Company’s valuation, valuation analysis by using all technical support and financial analysis. Research work to set up industries and their financial requirements and further investment opportunities. Investment-related negotiation and further communication thereon.

Q. How can I become an investment banker?

There is no specific or specified course to become an investment banker.  Some basic qualifications, analytical approach, and fundamental knowledge of financial assets will enable you to become an investment banker. Courses to be pursued like – MBA FINANCE and CFA or CA. Apart from the above courses you have to acquire core technical and soft skills which will lead you to be a successful Investment Banker after acquiring reasonable experience in this field.

Q. What is the average Investment Banker Salary?

Investment banking salary depends on their qualifications, years of experience, additional skills, location, country, size of the organization, and which cadres they belong to like financial analyst, Financial Manager, Financial Director, Vice president, etc. It also depends on the assignments handled by you.  Mergers and acquisition handlers are getting maximum payouts. In India Investment bankers’ average salary ranges from Rs.4.00 Lacs to Rs.50.00 Lacs according to their hierarchy and experience.

Q. Which company pays the highest investment banker salary?

As per the details available, Goldman Sach is paying the highest average salary i.e. Rs.41.50 Lacs.  2nd highest is JP Morgan Rs.29.00 Lacs. In UAE also salary is very high but that is on an individual basis, average salary details of any particular Organisation are not available.

Conclusion:

Owing to the opportunities mentioned above which all are high investment and net worth projects, it has full scope for growth and work in a challenging environment. They play a vital role from the beginning of the project and running the show successfully afterward also to accomplishing the challenging tasks confirms their contribution hence their scope is great and bright always. Investment bankers can pursue Venture capital, Wealth management, and entrepreneurship as an investment banker. It’s now crystal clear that their presence in the financial sector is foremost important.

Thus, work is being appreciated by the entire world and is placed on the list of one of the most prestigious careers all around the world.  In the end, I hope that by reading the above article you will be able to make out how an investment banker plays a very crucial role in big organizations. To become an investment banker and reach the point where the Investment banker’s salary is paid highest in its respective field.  All one needs to do is to be dedicated to one’s work.

 

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