Q&A: So you want a career in banking?

Hi guys, I recently met a friend who has some teenage children and they wanted some career advice prior to going to university. One of the teenagers is 18 and the other is 16, so I was pleased that they are seeking career advice even at this early stage, so that they can be on the right path to a successful career. Now they asked a lot of questions given that banking was one of the options they considered and since neither of their parents worked in banking, they decided to ask me those questions instead which is fair enough. These kids didn't know much about the banking world, I don't expect them to at that age, so here are some of the silly (and not so silly) questions they have asked me and I've compiled the answers here. I think it is great for young people to start thinking about their future careers! For those of you who are not my regular readers, I'm Alex and I'm a guy in his 40s working in corporate finance. So let's begin with the first question.

So you wish to work in banking?

Q1: Do you need to be very good in maths in order to work in banking? 

A: Not at all! Maths is completely irrelevant and useless when it comes to banking. I hold maths teachers around the world responsible for spreading the lie that maths is a useful subject when it is really one of the most useless subjects to study. Do you actually think that we sit at our desks counting money by hand or do we actually try to work anything out with just a calculator and our knowledge of calculus? Hell no. Look, if there's any mathematics to be done, it will be done by a computer. The whole reason why you use a computer is because you can then set up a programme to perform a certain function and it will perform it automatically and efficiently in a matter of milliseconds, whilst the same process done by humans may take days or even weeks. Let me give you a simple example: my company has a number of bonds that pay a dividend every six months. Does my colleague Stacy actually goes through each and every single account of every investor with month in the bond to work out just how much to pay each investor? No, of course not! That would take ages, that would be so ridiculously inefficient and whilst Stacy is very bright, she is also human and humans can make errors when it comes to doing mathematics. So no, Stacy doesn't have to do a single piece of mathematics at all - the entire process is done automatically by a computer programme which is set out to make sure that every single investor gets paid the right amount, on the right day and that the payments are processed automatically even if Stacy happens to be on holiday on a beach somewhere far away or if she has to take a day off because she caught the flu.

This is why the IT departments of banks are absolutely huge but are they employing mathematicians? No, they are not - they are hiring programmers and other IT experts, that's quite a different kind of technician. A mathematician is someone who has become an expert with pure maths whilst a computer programmer is the kind of person a bank would hire to write a piece of code that would make Stacy's life a lot easier by automating the entire process. That is why all Stacy has to do is to simply learn how to use the programme written by the IT experts - it's a bit like knowing how to use an iPhone, sure you can easily become familiar with how to make a call, how to send a text, how to take photos and videos, how to use various apps on the phone, but you don't need to know how to build the smart phone from scratch and that's the same principle with Stacy and the various programmes on her computer at work. No she doesn't know how to create one of these programmes, she just needs to know how to use them. So if anything, getting the right kind of training with computer programming, especially coding can prove to be extremely useful when it comes to getting a good job with a bank - but please, not maths. No, because maths teachers are such losers and they will tell you lies that maths is so fucking important that it will help you get all the best jobs out there. Did you ever think about saying this to your maths teacher, "oh yeah? If maths is so incredibly useful, then why are you still teaching maths in a school like this then? Why haven't you gone to work for an investment bank and get paid millions of dollars every year for your brilliant maths skills then?" There's a huge difference between IT and maths: one is extremely useful whilst the other is so fucking useless.

Q2: Do you need to study a degree related to banking and finance to get a job in banking? 

A: Again, no. Sure there are plenty of universities and other institutions out there who do offer courses in banking and finance but you're totally barking up the wrong tree if you think those courses are useful. I've acted as the gatekeeper in a number of companies within the financial services sector and let me explain to you how it works: we're not interested in your degree. We are interested in finding out whether you're smart or stupid: it is really that simple. Give me a smart person and I can teach you everything you need to know to do your job. But with a stupid person, no amount of training can make you ready to do the job, sorry - I can't fix stupidity with training. It is highly unlikely that a stupid person can make it to a top university like Oxford or Cambridge, so when we see an applicant from a top university like that, we usually don't even look at what they studied there - it's not relevant because they have already proved themselves to be highly intelligent and capable of learning anything we want to teach them. So between a candidate with a degree in banking & finance from a university in the middle of the league tables and a candidate with a degree in something silly like music/philosophy/history from Oxford, guess which candidate we're going to give the job to? Of course the Oxford graduate is always going to be offered the job every single time. So it mostly boils down to the position of your university on the league table and if you end up at a university near the bottom of the league table, then I hope your parents are well-connected and can call in some favours for you because you sure as hell are not going to get past this gatekeeper.

Q3: Can you make a lot of money in banking? 

A: It depends entirely on what you're doing at the bank. There's a simple relationship between how rare your skills are and how much you earn. I went down to my local bank branch the other day and needed to speak to someone in the branch - the lady whom I dealt with was friendly and helpful, but how much do you think someone like that who provides customer service in a branch like that is paid? Not much, why? Because what she is doing really isn't that unique or special, I'm sure she has had some training to familiarize her with the range of services available at that bank branch, but the barriers to entry to do a job like that isn't very high - in fact, it is a rather easy job to do so by that token, she isn't paid that much. The fact is there are thousands, even millions of service staff like that in bank branches all over the world, they're just not that special. So if you want to talk about a job in banking, this lady is working in a bank, but is she making a lot of money? Clearly not. However, contrast that to a fund manager - now the barriers to entry are extremely high for such a job and there aren't many fund managers out there in the world. Those with funds that have performed well are treated like rock stars in the banking world, I know because I have worked for one such hedge fund manager in the past. People like that can make 8 or 9 figures a year and the amount of wealth they have is pretty insane. So how much you make really depends on you, not the industry you're in. Big banks employ a lot of admin staff for example and they're usually paid quite little, so you shouldn't assume that just because someone works in banking that they must be wealthy. 

Not everyone who works in a bank is rich.

Q4: So you want to work for a big bank, right? 

A: Not necessarily, I think it depends on what is on offer. A lot of people don't know much about banking - all they know are the familiar banks they happen to come across when walking down the high street so for example, they see HSBC banks everywhere, so they start to believe that HSBC must be a good bank to work for. But that's just a certain kind of banking that deals with the retail public that has a presence on the high street, a lot of investment banking simply goes on behind the scenes, away from the public gaze. Billions of dollars are traded between these investment banks and they actually handle far more money than these retail banks. But of course, not all players in the financial services sector are big banks - there are a lot of small players as well who provide a service in their niche area and as long as they are good at what they do, they can remain independent and fairly small. Besides, if you work for a big bank, you'll always have a boss who will have a boss and there can be a lot of office politics that can drive you nuts - there's going to be a rigid hierarchy and you may be frustrated at just how slowly you climb the corporate ladder there. Contrast that to working in a much smaller company where you may be directly working for the owner of the business and it could be a lot easier for you to say, get approval for a new project or idea without having to convince a board of directors to give you the budget for it. Bigger doesn't necessarily mean better or more secure - Lehman Brothers were one of the oldest and biggest investment banks in the world before it collapsed spectacularly in 2008, whilst a lot of the smaller firms managed to ride out the recession. Ultimately, it's not how big your employer is - what really matters is how much they are paying you and that will depend entirely on what you can bring to the table, what value you can add and what special skills you have.

Q5: Say I have just finished my degree, how do I get into banking then? 

A: I'm afraid it is a lot harder than you think. To begin with, you need to get relevant internships and work experience whilst you are a university student. Some banks do have a graduate recruitment programme and usually, they would have an 'approved list' of universities they will recruit from - now this is not a strict list, so for example, the list may cover say the top 5 or top 10 universities in the UK, but if a French graduate applies and he is from the very best university in the French speaking world, then of course the bank would most certainly be happy to consider his application. But if you got a degree from a private university that's not worth the paper it is printed on, don't expect the gatekeepers to make an exception for you the same way they made the exception for the French graduate. But don't neglect the smaller companies as well, you can always do your research into a particular area of finance that intrigues you and find a list of smaller companies who do operate in that field - write to them, ask them if they are recruiting or offering internships. It is just an email, what have you got to lose? Be patient, many of these smaller companies may not be able to offer you a job if they're just not recruiting, but it is probably easier to get some work experience with them than with some of the more prestigious investment banks and if you're starting from zero, then an internship with a small company is certainly a foot in the door. There are also loads of other companies from IT solution providers to accounting firms to legal firms to PR consultants who all serve the financial services sector directly or indirectly, so why not consider those companies as well.

Q6: What qualities are you looking for in a candidate? 

There are so many but let me just highlight one of the most important that is often overlooked. We are looking for fast learners - demonstrate to me that I can show you a complex process and you can master it in a very short space of time. Take my colleague Stacy for example whom I have mentioned earlier, now what she does is complicated but it is a process that is unique to our company's system. No amount degree in the world could have prepared her for this job as she didn't know she was going to work here whilst she was a student. Instead, she is a bright and diligent person who has great attention to detail so the company was able to train her up to perform those complex functions very quickly, so now she is able to execute those intricate processes flawlessly. I don't know what Stacy has studied at university, heck I don't even know if she has a degree - all I know is that she has all the right qualities to perform her job really well and that's all that matters. I have another colleague Ana who did a degree in German and Spanish, her mother tongue is Croatian and she grew up speaking Croatian to her parents but English to her friends at school. Now actually think that German is a devilishly hard language to learn because of the very complex grammar system, yet Ana managed to learn German to an extremely high standard in a few years - enough for her to have worked in a 100% German speaking environment in Berlin. So that has clearly demonstrated her ability to learn very complex systems in a very short time and whilst she is not using her languages in her current role (what a shame), what she is doing is highly technical and complex, it is a job that depends on her understanding the rules of structuring these very complex financial instruments.

So the common theme here is that we're looking for people who understand rules and regulations, who have demonstrated that they're willing to follow the rules. It's a bit like playing a computer game - when you play a computer game for the first time, you're usually offered a tutorial that teaches you what the rules are, what the objectives are, how to score points and what mistakes to avoid. If you willfully ignore the rules taught during that tutorial, then you're probably going to score very few points and your game will end miserably. In banking, it is pretty much the same - for many of the jobs, you have to adhere very strictly to the rules otherwise you could be breaking the law. This is one of the most tightly regulated industries around especially after the 2008 financial crisis so there are so many rule and regulations that we are governed by within this industry. Again, like a computer game, as long as you understand what those rules are and play well within the rules, there's no reason why you can't excel and make loads of money. By that token, we avoid candidates who look as if they are not very good at following the rules: that would probably make them difficult to work with in such an environment. So if a candidate shows up for an interview casually dressed, he is breaking convention in doing so as one would normally expect a candidate to turn up for an interview formally attired - you may think that one's attire doesn't reflect on one's ability to do the job, but you're sending out the wrong message. You're telling the world, "I don't want to follow your rules, I don't care what your rules are, I will simply do things my way to make me happy." Hence if that's the kind of person you are, then please stay the hell away from financial services - go do something else instead.

Do you follow the rules or question authority?

Q7: How do I know if a career in financial services is right for me? 

A: That's a good question. I've seen people leave the industry after a few years because they're not happy, I've also seen people join the industry after having done something else that wasn't right for them. You can always begin by speaking to someone like me who has worked in the industry for a while to find out how I got into this job and see what my daily routine is like, what kind of challenges I face, what aspects of the job I enjoy and which ones I dislike. Then the next step is to immerse yourself in that environment by getting an internship or some work experience, where you can see for yourself what people are like in the office and if you would love to do what they do or if you may decide no thanks, I'd rather go work in a zoo and be surrounded by lovely animals instead. I can't really tell you what will be right for you, you need to decide for yourself which career path you would like to go down, what your ambitions are and what you want to do with your life. There's also an important reality check of course: say you have a degree from a private university or one at the wrong end of the league table, then your prospects aren't likely to be any good in this industry - like even if you do manage to get a job lower down the food chain, you're going to have to work twice as hard to prove yourself and you may find an Oxford graduate recruited fresh out of university into a more senior position. You need to evaluate your situation carefully and play to your strengths, in order to maximize your chances of being happy and successful in your career. Even if you claim, "oh I just wanna make money, I don't care what I do as long as I get rich", a lot still depends on what kind of people you end up working with - there are great bosses and awful ones, lovely colleagues and piranhas!

Q8: Is there a lot of discrimination against people of minorities in your industry against ethnic minorities, LGBT, of a minority religion, working class as well as those who are disabled . How do you cope with that? 

A: Well, I recently wrote an article about just how few women there are in my industry and it is true - at least here in the UK the industry is dominated by older, white men of a certain privileged background. But then again, the one thing that does keep the industry competitive is the need to keep making money - if a company were to simply hire posh people based on having the right social background rather than their abilities to do the job, then the company would probably end up losing a lot of money and go bankrupt pretty quickly. So instead, many rich people have learnt to keep work and play separate: the industry is open to anyone who can make them a lot of money - they will work with whoever they have to during office hours and once they get off work, they return to their very personal lives. So if you look at their colleagues and their personal friends, you'll see that their colleagues probably come from a much wider range of backgrounds and you'll find a lot less diversity amongst their personal friends. I'm Asian (well, technically speaking I'm mixed, but clearly of an ethnic minority in any case), I'm openly gay, I'm an immigrant, I'm autistic and I came from a very working class family - yet I have been working quite happily in this industry for many years. Because I work in sales, I'm judged by my sales figures rather than the schools I went to or what my parents did for a living. Oh yeah, people who work in finance are very pragmatic like that, there's a great saying by Deng Xiaoping: 不管黄猫黑猫，只要捉住老鼠就是好猫 (it doesn't matter if it is a yellow cat or a black cat, as long as it can catch mice it is a good cat). That's a very pragmatic approach to this issue and one that has allowed me to thrive in this industry. As long as I am good at making money for my company!

Allow me to speak as someone who came from a very working class family: I think the biggest challenge for me was my working class background - not my ethnicity, not my sexuality but my social class. You see, this is an industry which stresses following the rules a lot - it is tightly regulated and a lot of the time employers want someone who can demonstrate quickly that they're willing and able to follow the rules. Well, there are so many rules about how you dress formally in the office that I never knew about as someone from a working class family - my parents have absolutely no clue at all about anything like that so they were never in a position to teach me anything. Contrast that to the people from rich family whose parents would carefully guide and nurture them, imparting all the right social skills for them to fit in very comfortably in this kind of formal situations - their parents would tell them what to wear, how to speak, how to establish rapport whilst I had to figure everything out on my own. So for these rich, posh kids, fitting in was second nature to them as they grew up amongst such people anyway - whereas for me, all the new social rules about how to speak, how to dress, how to relate to people represented a really steep learning curve for me. But there's plenty I need to learn all the time on the job anyway, so I treated the social aspect of my job as just something else I had to learn. But what holds a lot of working class people back is this toxic mix of stubbornness and pride: when they say, "what's wrong with the way I dress or speak? How dare you discriminate against me for being working class? And why are you looking down on me for being working class?" That's when alarm bells ring - that's the sign of a rebel who refuses to follow the rules and no, you don't want to have to work with someone like that in an industry that is governed by so many rules and regulations.

Q9: I have applied for many jobs in banking but have been unsuccessful - at what stage do I give up then? 

A: Aah that's the harsh reality of young people looking for their ideal job these days. It could take you a long time to land you your ideal job and there are very few people who actually totally love the first job that they get. So in an ideal world, you'll go to a top university and then waltz into one of those prestigious graduate recruitment programmes by a big bank, then your career in banking is off to a flying start. But if you fail to do that, that's still not the end of the world. Here's my story: I didn't get a good job out of university, I fell into sales by accident as I was looking for a role that would allow me to use my many languages - that was my first job, trying to sell people around the world advertising on a website, using my various languages. If it sounds like a hard sell - well, it was, but that was 2000 and everyone believed that you could make money off the internet like that and we actually sold loads of ads on various internet websites. That allowed me to move up the food chain in terms of selling more expensive and more credible products over the years until I eventually ended up in corporate finance, where I am still in sales but I am brokering various investment deals. I started at the bottom and crawled by way to the top over a period of 18 years and now, I am doing better than some of my peers who did get into those graduate recruitment programmes when they graduated. Don't give up, keep on developing those transferable skills and you are always moving one step closer to your dream job as you gain more and more useful work experience over time.  Besides, you might find something else you would rather be doing so always keep an open mind.

Q10: Do you have to work very long hours in banking? 

A: Actually, it depends. Some people do work very long hours, others stick to a more standard 35 - 40 hour week whilst others like me enjoy a lot more flexibility in the way we work. So as you know, I am self-employed and so if I don't work, I don't earn. Currently, I have earned so much this tax year that I know that every extra pound I earn is taxed at about 45% so the government gets £0.45, I get to keep £0.55. So I am not very motivated to work that hard until the new tax year, hence I will start the new year with a 10 day long holiday to Georgia because I can do what the hell I like. So compared to a lot of people, I would be working very little in the first three months of 2019. Once I get back from Georgia, I think my next holiday would be to Ukraine in mid or late February, where I will spend another week or more there. And this is all after I have taken a holiday to Malta before Christmas and that means I've not really done any work since mid December and won't be doing much in the next few months - am I lazy? Guilty as charged. I work far fewer hours a week than my two sisters in Singapore, I'm very lucky to be in this position. But with the way my tax affairs are going, I really don't see the point of working my butt off and if my company isn't hounding me to do something urgent, then I'm pretty much just going take it easy till April. So if you have any suggestions, then I'm more than interested. I hope that answers your question: some people will be working very hard in banking, I know some of my colleagues certainly will be but not me.

So that's it from me for now. What do you guys think? If you have any questions about getting into banking or if you are a teenager considering your career options and need to speak to an older adult who has been in the industry for a while, feel free to leave a comment below and ask away. And if you're leaving a comment in January, just bear in mind I'll probably be having a great time on holiday in beautiful Georgia and may not respond quickly. Many thanks for reading.