Why Investment Bankers Are Becoming A Dying Breed

An Investment Banker is someone who is primarily concerned with raising capital for corporations, governments, or other entities. Pre subprime mortgage crisis, banking firms provided many perks to investment bankers including mind-boggling yearly bonuses, business class flights , free dinner at Michelin-starred restaurants and amazing medical insurance.

However, we have now come to a point in history where investment bankers are becoming a dying breed, and one major reason could be the decline of these aforementioned perks.

The fact that these companies are starting to reduce the amount of perks to investment bankers is born out of necessity. The reality is that these financial forms have now come to their senses: geopolitical conflict and decreasing demand means that the once profitable investment banks are mired in financial struggle.

Currently, as of September 2019, the 12 biggest U.S and European investment banks have generated $76.8bn in revenue from their trading and advisory operations during the six-month period this year, down from 11% in 2018. It was the slowest first half since 2006, according to the latest data from industry monitor Coalition. Furthermore, banks have  also individually reported poor second-quarter earnings for their markets and investment banking divisions, including an 18% fall in fixed-income revenues at Morgan Stanley and a 32% decline in equities revenues at Deutsche Bank. 

Therefore, it is becoming evident that investment banking firms, which used to be the go to place for undergraduates from colleges due to their high salaries and other benefits are now facing a rapid decline and that most under graduates with degrees in the sector of Mathematics look towards I.T companies like Google, Apple and Microsoft for jobs. Only time will tell if these companies can get back on their feet or if they disappear for good...