Careers in Public Finance
In short, investment bankers serve as advisors to, and intermediaries between, the issuer of securities (corporations and governments) and the public and private investor markets. Whether you are interested in investment banking, commercial banking, or financial services, you will find that many of the same job functions, as well as skill base, are found in all the major sectors of the “financial” industry. As banks have grown, through mergers and internal expansion, their client base has expanded globally. Cross-border deals are commonplace and many of the existing barriers to entry and investment into markets undergo change reflecting current international economic realities.
The financial industry is traditionally broken into the following main areas:
- Corporate Finance The areas considered as Corporate Finance cover a wide range of financial services including Corporate Structure Finance, Mergers and Acquisitions, Initial Public Offerings (IPOs), Private Placements, and Real Estate Finance. The mission of a Corporate Finance department is to help its clients form and develop sound financial strategies to meet their goal by serving as an advisor and by raising or deploying funds. Businesses may need to raise cash to buy another firm, expand manufacturing capacities, pay down debt, buy-back its own stock, or possibly to divest themselves of a division.
- Sales and Trading This group serves institutions such as pension plans, mutual funds, and insurance companies. In addition, many traders are dedicated to the firm’s own “house account.” The Sales department’s main responsibility is to maintain positive client relationships. Other key functions include the sale of existing securities in the firm’s inventory and the distribution of the firm’s initial public offerings. Traders execute trades in equities, corporate and municipal bonds, derivatives, currencies, and commodities.
- Public Finance This department raises funds for the development of public projects. Investment banks help states and their agencies and authorities, municipalities, and counties to raise large capital requirements through the issuance of federal tax-exempt securities. These bonds finance hospitals, airports, schools, mass transit and power plants to name a few.
Internships are one of the most efficient ways to gain the experience needed to enter the field. Any demonstrated experience, which requires economic analysis, understanding of economic markets, or reaction to financial news or trends is of interest to potential employers. Networking, especially in more difficult financial periods, is essential for anyone interested in entering this competitive field. Contact alumni from your school who are working with firms you are interested in to build your networking infrastructure.
A solid background in business-related courses such as accounting, business finance, money and financial markets, statistics, micro- and macro-economics is recommended. In addition, candidates should be able to analyze a corporation’s growth potential, profitability, industry niche, future projections, etc. They must be able to read and understand annual reports, balance sheets, income statements and cash flows.
Any demonstrated experience that requires economic analysis, understanding of economic markets, or reaction to financial news or trends is of interest to potential employers. An internship with a bank will improve your chances and grant you the necessary experience to attract recruiters. A framework of public policy, international trade, language and cultural fluency combined with business skills is an invaluable combination for entry into the financial industries.
Careers-In-Finance - Find information on what types of careers exist in the field of finance, average salaries, and job postings.
CareerBank.com - CareerBank powers the online job boards for the largest accounting fraternity, Beta Alpha Psi. Employers such as, Deloitte, PriceWaterhouse Coopers, KPMG, and Fortune 500 companies use CareerBank to find qualified professionals.
Private Equity Database - Database of approximately 1,200 private investment firms. PEdatabase has combined the database with useful search tools to locate appropriate firms of interest.
Federal Reserve, http://www.federalreserve.gov/