What does an Investment Banking Analyst do?

An investment banking analyst evaluates the finances of various companies within certain business sectors, advises clients on potential investments, facilitates mergers and acquisitions and helps identify or secure funding for a new business. Investment sectors covered by an investment banking analyst include energy, retail and financial services. When conducting a financial analysis of a company, an investment banking analyst looks at the profits and earnings of a company as well as market trends within the industry that the company conducts business in. A business degree from a college or university is typically required to work as an investment banking analyst. Candidates for a position as an investment banking analyst should also have effective oral and written communication skills.

The primary duty of an investment banking analyst is to review financial statements to discern the financial health of a particular company or industry. An investment banking analyst may also create financial models that predict future revenues, profits or share prices of a company. Such information may influence an investment bank’s choice to underwrite or purchase stock in a corporation. Analysts also advise clients in mergers, the joining of two companies, and acquisitions, the purchasing of one company by another.

Investment banking analysts may also secure clients as part of their duties. Typically, investment banks give potential clients a brochure detailing the services and benefits they offer based on the research conducted by a business analyst. A financial analyst may also conduct “cold calls”—phone calls to prospective customers that are not expecting such communications. These calls usually involve the analyst attempting to sell a service or advising an existing client to invest in a certain enterprise or venture. The analyst may earn a commission if he successfully completes the sale of the service or stock.

Due to the quantitative nature of the job, a typical investment banking analyst is expected to have a degree or background in finance, economics or accounting. These disciplines also expose a potential candidate for the position of analyst to financial statements and allow him to home his skills in identifying strong and weak companies and develop intimate knowledge of investment and economic markets. People working at investment banks may be required to share their research with peer or supervisors. Consequently, an investment banking analyst should be articulate and capable of submitting written reports in a clear, concise manner. This position also has a sales component to it; analysts should be well-versed in socializing as a result.