Understanding The Bank Analyst Job
Before you dream yourself comfortably seated in one of those luxurious chairs strategically placed at the best location of the most successful bank, let me tell you what people at bank analyst jobs do.
First of all understand the deal cycle of the corporate finance department. Investment bankers - the vice presidents and managing directors - approach or be approached by companies with ideas for potential transactions. These deals may include IPOs, follow-on offerings, private placements, mergers and acquisitions. After understanding the deal cycle there comes the first step called as the pitch.
Bankers set up a meeting with the company called a pitch, in which they pitch the services of the firm to the company and present their analysis of the feasibility of the potential transaction. At the pitch, the bankers present the potential client with a pitch book - usually a hard-copy PowerPoint presentation that describes the credentials of the bank along with a detailed analysis of the market in which the company operates and often a valuation of the company itself.
As simple as it sounds, though, preparing pitch books is no easy task. As the name of the job suggests it has to deal with analysis. The analysis at the bank analyst job position involves the comparable companies analysis-also called as comps. Comps are a valuation methodology in which public companies that are similar to the company in question are used to create multiples from which the value of the company can be extrapolated.
In addition to comps, bank analyst job personals might be called upon to prepare a discounted cash flow analysis (DCF) for a pitch book. A DCF model is a bit more involved and requires putting together financial projections for a company, calculating its weighted average cost of capital (WACC) and using it to discount the cash flows to determine its value.
Other perks often include reimbursement for cell phone or blackberry bills, free cab rides for late trips home and the occasional opportunity to celebrate with other bankers at a lavish closing dinner. With all these opportunities to save money and the long hours, analysts often have a hard time finding ways to spend their money.