GRADUATE CAREERS COACH: If answers to competency questions are so important for getting into investment banking, what's the difference between a good answer and a bad one?
Nadia Capy-Osgood, a seasoned graduate recruiter who’s worked at various investment banks, has agreed to answer some of your questions on getting into investment banking. If you have a question for Nadia, add it to the bottom of this article or email us at Editor@eFinancialCareers.com (with “Question for Nadia” in the headline).
This week, Nadia answers some questions from someone who wants to know how to answer investment banks' competency questions.
QUESTION: Hi Nadia. In your last set of responses to a student's questions, you said competency questions are key to getting a job in banking. What kinds of answers to recruiters look for?
I can't give you any specific answers, but I can give you some examples of what makes an answer strong or weak.
A typical competency-based question might be:
"What made you decide to pursue a career in investment banking? Why have you chosen XXX and why are you suited to this business area?"
A good answer would be structured as follows:
i) Firstly outline what investment banking is - describe the main business areas within investment banking. Then state your division of choice (and say you will elaborate later). Give clear reasons for choosing investment banking - include the draw of the City, great training, international career with a great opportunities etc. Give some brief comparisons to other similar roles (it's good to recognise that they offer great opportunities too but to highlight why IB wins you over) and why you prefer investment banking over them (eg - broking / accounting / consulting). Highlight the key differences to show you understand what they are - really think about these differences - is it the analytical element, the risk, the client relationships, the size of the firm that attracts you?
ii) Now go into detail on the area you want to work in. For example, if you want to work in corporate finance/M&A - you should give some examples of recent deals the firm has done and all time great deals that may have happened a while ago. Research the web and find out about the division head or any key figure heads and note their achievements or aspirations for the firm. Say what excites you - eg longer term deals, advising main board directors, the analytics, understanding a sector / industry in great detail and becoming a key advisor in this sector.
iii) If you have had experience - mention and detail it again here (also mention it in the first line of the question!). Detail information about your character, your team skills, proof of your attention to detail, and your commitment to producing quality work/being a high achiever/perfectionist.
Show enthusiasm in your last sentence - state that you have made more than 20 applications to all the best city banks, state how many interview invites/fast track interviews you have had and that you are confident that you will embark on the career of your choice in the city because it is the most important thing you want to achieve.
By comparison, a poor answer could be a really passionate account of why you want to work for any firm in the city. Remember that words like, "global, cutting edge, international, highly pressured," mean nothing unless they are backed up with specific facts about the industry/sector and area within in that you have applied for.
It is very easy to pick out a graduate who does not really understand the differences between sales and trading or research, or a candidate that does not really understand asset management over corporate finance. Again, lack of research into the firm is a NO NO - it is not impressive reading. Nor is an answer that has been cut and pasted from several banking applications - with nothing unique about the company you are applying for. A candidate who does not show they have read the annual report, does not know of any key staff from the company or of any recent deals is also weak. These weak candidates usually don't have any relevant work experience and have not tried to rectify this in any way through setting up their own business or starting an initiative at university.
Nadia Capy is a project manager for Graduate Solutions, an independent firm which operates graduate recruitment programmes for different firms in the City.