25 Top Financial Services Firms 9781582078014, 9781582078007

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Insider

Guide 25 Top Financial Services Firms

2008 EDITION

25 Top Financial Services Firms

WetFeet, Inc. The Folger Building 101 Howard Street Suite 300 San Francisco, CA 94105 Phone: (415) 284-7900 or 1-800-926-4JOB Fax: (415) 284-7910 Website: www.wetfeet.com

25 top financial services firms 2008 Edition ISBN: 978-1-58207-801-4

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Copyright 2008 WetFeet, Inc. All rights reserved. This publication is protected by the copyright laws of the United States of America. No copying in any form is permitted. It may not be reproduced, distributed, stored in a retrieval system, or transmitted in any form or by any means, in part or in whole, without the express written permission of WetFeet, Inc. The publisher, author, and any other party involved in creation, production, delivery, or sale of this WetFeet Insider Guide make no warranty, express or implied, about the accuracy or reliability of the information found herein. To the degree you use this guide or other materials referenced herein, you do so at your own risk. The materials contained herein are general in nature and may not apply to particular factual or legal circumstances. Under no circumstances shall the publisher, author, or any other party involved in creation, production or delivery of this guide be liable to you or any other person for damages of any kind arising from access to, or use of, its content. All illustrations by mckibillo

25 Top Financial Services Firms

25 Top Financial Services Firms

conte 2008 EDITION

CHAPTER

1 2 1 The Industry

7 The Firms

35 Credit Suisse

73 Piper Jaffray

2 Overview

8 A.G. Edwards

39 Deutsche Bank Securities

76 Raymond James Financial

4 The Bottom Line

12 American Express 43 FMR

80 UBS

4 Interviewing Tips

15 Bank of America 46 Goldman Sachs

83 U.S. Bancorp

50 Jones Financial

86 Vanguard Group

54 JPMorgan Chase

89 Wachovia

58 Legg Mason

93 Wells Fargo

18 Bank of America Global Corporate and Investment 21 Bear Stearns 25 Capital One Financial

61 Lehman Brothers Holdings

28 Charles Schwab 65 Merrill Lynch 31 Citigroup 69 Morgan Stanley

nts

The Industry

1

Overview........................................2 The Bottom Line........................... 4 Interviewing Tips.......................... 4

25 Top Financial Services Firms

Overview

The Firms

the industry

By even the most conservative estimates, trillions of dollars in currency are floating around the world. And someone has to keep track of it all. Financial services is a growing field, with many job options. Do you want to work for a commercial bank, an investment bank, a brokerage firm, a credit-card company, or a mutual fund company? Even if you go to work for one of the mammoth financial services conglomerates offering opportunities in many if not all of these areas, you still must determine where your skills and career desires fit best.

Investment Banking On what might be the most lucrative end of the finance spectrum are the investment banks. You’ve heard about the insane hours, the mammoth bonuses, and the megabillion-dollar deals. But what is investment banking exactly? At its best, it’s an intensely competitive, action-oriented, profit-hungry, biggerthan-life world, where deals are done and fortunes are won. Keep in mind, though, that investment banking isn’t one specific service or function. It’s an umbrella term for a range of activities: underwriting, selling, and trading securities (stocks, bonds, and other investment vehicles); providing financial advisory services, such as merger and acquisition (M&A) advice; and managing assets. Investment banks offer these services to companies, governments, institutions, and individuals. Wall Street is teeming with high-energy, hardworking, young hotshots. Some are investment bankers who spend hours gazing at computer screens, poring over financial statements and churning out spreadsheets by the yard. Others are traders who keep one eye on their Bloomberg screen, a phone over each ear, and a buyer or seller on hold every minute the market is in session. Traders work hand in hand with the institutional sales group, whose members jet from airport to airport trying to sell big institutions a piece of the new stock offering they have coming down the pipeline. Then there are the analytically minded 

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research analysts, who read, write, live, and breathe whichever industry they follow, 24/7. It’s not unusual to see analysts, and even traders, spending their free time studying 10-Ks. Investment banking is a great place to learn the ins and outs of corporate finance and pick up analytical skills that will be useful throughout your career. But there’s a difficult learning curve, and chances are you’ll start in a job whose duties are more like those of a peon in Working Girl than that of the top bosses in Wall Street.

Commercial and Consumer Banking You are undoubtedly more familiar with commercial and consumer banks, which, along with savings institutions, remain the cornerstones of Main Street economic life. Most of us maintain checking accounts at commercial banks and use their ATMs. The money we deposit in our neighborhood bank branch or credit union supports local economic activity through smallbusiness loans, mortgages, auto loans, and homerepair loans. For decades, commercial banks profited by simply holding customers’ money and charging them check-writing fees and interest on loans. Jobs were well-defined and stable, and promotion paths were clear and secure. Nowadays? Not so much. Consolidation, competition, deregulation, and technological change are overhauling the industry to its core, forcing layoffs but also creating new opportunities. The financial industry has been shaken and stirred in recent years, fundamentally altering almost every banking operation. Traditionally, commercial and investment banks performed completely distinct functions. When Joe on Maple Street needed a loan to buy a car, he visited a commercial bank. When Sprint needed to raise cash to fund an acquisition or build its fiber-optic network, it called on its investment bank. Paychecks and lifestyles reflected this division too, with investment bankers reveling in their large bonuses and high lifestyles while commercial bankers worked nineto-five, then went home to their families.

Impact of Deregulation

M&A activity has jumped, mortgage borrowing has continued to increase, and hedge funds have burst onto the scene. Even during the bad times, many financial services companies recruited at colleges nationwide. They are always looking for new (read: cheaper) bodies, especially in investment banking.

Where the Jobs Are Key jobs in investment banks are divided into four areas: corporate finance, sales, trading, and research. Generally, those who do investment-banking internships will have the best shot at full-time openings. The finance industry has become more willing to hire people who didn’t major in finance or go to Yale. Competition is fierce, but there are opportunities in a supporting division. You can then move laterally into a finance position. On the retail broker side, many firms hire at the midcareer level from many different backgrounds. Depending on the scope of a company’s operations, the jobs in commercial banking, mutual funds, and credit-card groups vary significantly. Note: This guide is intended to cover more than just jobs in I-banking, since opportunities at the 25 top financial services firms include positions extending beyond that realm. That said, since many of the most attractive jobs for MBAs at these firms are in Ibanking, we’ve included a lot of pertinent information in that area.

the industry The Firms

The 1999 Gramm-Leach-Bliley Act (also known as the Gramm-Leach-Bliley Financial Services Modernization Act) repealed the Depression-era Glass-Steagall Act and changed finance. The repeal opened competition among commercial banks, investment banks, insurers, and securities brokerages, letting them consolidate and engage in many different financial activities from which they were excluded under the earlier legislation. This led to merger mania, and the creation of mammoth conglomerates in the late 1990s. More and more firms made sure they had a thumb in more and more pies, further blurring the lines between oncetraditional financial functions as well as their distinct cultures. Wall Street has been on a tremendous rollercoaster ride during the last few years. In 2000, the new-millennium economy couldn’t be beat. The bull was riding high, the Internet bubble was floating, and investment banks were hungry to snap up as many recent college graduates as they could. Then the bubble burst, and the party was over. Ruthless cost-cutting, selling of low-profit operations, scaling back of expansion, and rounds of layoffs were all part of a major retrenchment. Accompanying that was a significant decline in salaries. Overall, headcount was down by as much as 25 percent in the investmentbanking industry. The troubles went beyond declining business, though. Corporate scandals made daily front-page news, 9/11 traumatized the markets, the Argentine economy collapsed, and the names Enron and WorldCom sent investors fleeing in droves. The demise of the dotcoms virtually ended initial public offerings (IPOs), a major source of revenue for I-banks. And the greed that helped drive financial services firms during the boom years came back to haunt them in the form of increased regulatory oversight and billions of dollars of fines for misdeeds. In the past couple of years, however, the financial services industries have rebounded. Recent quarters have seen record financial results for investment and commercial banks. Stock prices have risen. IPO and

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25 Top Financial Services Firms

The Bottom Line

the industry

Regardless of the market, there’s always money

to be made in the financial services industry. If you like fast-paced, deal-oriented work and gravitate toward numbers and analysis, investment banking is one of the best ways a young person can make a lot of money right out of school. But be forewarned: This means sacrificing your social calendar and meeting the challenging, high-stress, high-risk demands of handling multiple transactions in which millions of dollars of other people’s money are involved—without making mistakes and all while running on minimal sleep.

INSIDER SCOOP “I remember when one coworker pulled two allnighters in a row wearing the same clothes. Why didn’t she have an extra outfit in the office? She was a first-year. She learned the hard way.” One former investment banker (now in law school) told us of the time he woke at the crack of dawn, put on his three-piece suit, wandered halfawake onto the New York subway, rode uptown, and walked into an abandoned office before realizing it was Saturday. The days had bled into one another. But that was just one story.

INSIDER SCOOP

The Firms

“I saw one intern asleep on the conference room table. The managing director walked in the next day and saw him there. And these kinds of things happened all the time.” Off the Street, you’ll receive less pay and work on fewer high-profile deals—it’s a trade-off for a better work/life balance, fewer peer rivals, more responsibility, and a lower cost of living. One thing is certain: You shouldn’t go into banking just for the 

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money—the lifestyle is too demanding and people burn out well before the age of 30. To survive in investment banking, much less do well, you need to like the work. And, quite honestly, even if you love the work, an I-banking career can be rough. If the market or your industry group is in a slump, there’s a chance you’ll find a pink slip on your desk Monday morning. Despite this inherent uncertainty, the field remains an extremely popular destination for undergraduates and MBAs. And no matter where you go after your first I-banking gig, the skills you develop working on Wall Street you can take anywhere. If you can’t stomach the demands or you value your free time, you can try less stressful routes in retail brokerage, commercial banking, mutual funds, credit cards, and the finance department of a nonbanking business. Although these jobs aren’t nearly as lucrative, they still offer the promise of high salaries, steady work, and a long-term career. You won’t be wheeling and dealing and hobnobbing with the rich on a daily basis, but you will be part of a newly revamped global industry. You’ll be at the forefront of change, with the opportunity to see and understand how money moves around the world.

Interviewing Tips . There’s no surefire way to guarantee yourself

an offer at a financial services firm, but your best bet, especially for large investment and commercial banks, will be to go through the on-campus recruiting program. If your school isn’t targeted, or if you are a midcareer hire, network through college alumni or industry contacts. Snagging an internship is also a smart way to get your foot in the door. Insiders say there are a number of ways you can improve your chances in the interview process. Here are a few of their suggestions on how to prepare:

1. Know why you want to work in a particular finance area and what distinguishes the firm you’re interviewing with from its competitors. Do your homework to understand what is going on with the firm, its objectives, and (positive) points of differentiation. Be prepared to be grilled, but be engaged and ask targeted questions about the firm’s industry position, avoiding ones you should already know the answer to.

6. And don’t forget to check out WetFeet’s investment banking interview guides: Beat the Street®: Investment Banking Interviews and Beat the Street® II: I-Banking Interview Practice Guide. Both are available in bookstores and from www.wetfeet. com.

the industry

2. For I-banking positions, be prepared to answer any finance question. Do you know what the Fed fund rate is right now? Why is Ford’s P/E ratio so much lower than Kellogg’s (or not)? Make sure you know how the market is doing the day you interview. Demonstrate your passion for the industry, and speak articulately about current trends from a short- and long-term perspective. Thinking quickly and outside the box goes a long way.

5. Don’t leave your personality at the door. Recruiters want to make sure you’re equipped to handle the work, but they also want to know what it would be like to have you as a coworker. Many call it the airport test: “How would I feel spending a three-hour layover at an airport with this person?”

3. If the entry-level program isn’t rotational, know where you want to work in the firm and why. Having a focus on a goal is important. A lack of focus will earn you a ding. Pick an area that matches your interests, but know the overall structure of the firm and how each division relates. Depending on the type of job you’re pursuing, your recruiters will be looking for different skills.

The Firms

4. Being hungry for an investment-banking job is at least as important as having a top-tier school on your resume. Wall Street firms see a lot of flashy pedigrees, but what really makes a candidate stand out is overwhelming enthusiasm and commitment to work. Show passion and keep a high energy level to impress the recruiter. Your analytical ability and interest in finance are as important as your interpersonal skills, self-confidence, and ability to work under pressure with a lot of complex information. Spin each of your previous experiences as skill-building exercises that have prepared you for Wall Street. WETFEET INSIDER GUIDE



The Firms

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25 Top Financial Services Firms

A.G. Edwards One North Jefferson Ave. St. Louis, MO 63103 Phone: 314-955-3000 or 877-835-7877 Ticker: AGE www.agedwards.com

The Firms

the industry

Overview Not many men name their sons after the secretary of the treasury, but Albert Gallatin Edwards’ father did. It turned out to be a fitting choice. Founded in 1887, A.G. Edwards has proven its durability as one of the largest securities firms outside the New York area. With home offices in St. Louis, the full-service firm provides brokerage, investment-banking, trust, asset-management, insurance, and retirementplanning services. In addition, the firm’s A.G. Edwards Capital Markets subsidiary invests in private-equity partnerships and its newly created subsidiary, Gallatin Asset Management, provides investment-advisory services to third parties, such as mutual fund and insurance companies. Admired for its “stick to your knitting” business philosophy, the company’s lean cost structure and conservative growth strategy were assets in the recent economic downturn. The company has built its business gradually with a core of Midwestern clients. It has more than 700 locations in the U.S. and Europe, and it offers investment-banking through several regional offices. On the I-banking side, its research group (it has some 50 senior research analysts covering more than 700 companies in 70 industries) is especially noteworthy: The firm has had researchers finish within the Top 10 in The Wall Street Journal’s “Best on the Street” list in each of the past seven years, and it garnered the top spot in 2006. Edwards’ key business is providing investment advice and financial planning through its retail network of more than 6,600 financial consultants (down from nearly 6,900 in 2005). After unprecedented growth in the 1990s, the company 

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was hurt by the collapse of trading after the market crash of the early 2000s, and layoffs were a part of the picture at the firm during that time. As the market has recovered, though, so has the firm; its 2007 fiscal year profit exceeded $331 million compared to a profit of about $72 million in 2002. Like other investment firms, Edwards has streamlined in recent years, going from a headcount of 17,000 in 2001 to just under 15,400 employees in 2007. In May 2007, Edwards announced it had been purchased in a $6.8 billion deal by Wachovia. The combined brokerage will be St. Louis-based Wachovia Securities, which will feature 14,784 brokers and $1.15 trillion in assets. The deal is slated to be finalized in fall of 2007, with Edwards fully integrated into Wachovia in 2009. Also in May 2007, the firm agreed to a $3.86 million settlement with the Securities and Exchange Commission, which charged that Edwards had failed to prevent its “registered representatives [from using] deceptive means to place market timing trades on behalf of their customers.” Meanwhile, insiders say the firm has always concentrated on its clients above all else. “Our management team keeps us focused on our clients’ long-term needs rather than the firm’s shortterm profits,” one insider says. “I chose to work for Edwards because the firm has no proprietary products, no conflicts of interest for the brokers, limited investment banking, and the most generous retirement plan in the business.”

Recent Milestones 2007



Announces purchase by Wachovia for $6.8 billion, with full integration into Wachovia slated for 2009. Agrees to $3.86 million settlement with SEC over charges that it failed to supervise brokers who engaged in illegal market timing. Named to Fortune’s “100 Best Companies to Work For” for 10th consecutive year.

2006

Ranks first out of 72 firms on The Wall Street Journal’s “Best on the Street.”



Creates Gallatin Asset Management subsidiary.

2005

Reveals in a regulatory filing that it might be disciplined by the NASD for allegedly improper mutual fund sales.



Named to Fortune’s “Best Companies to Work For” list. Becomes one of only 22 companies to make the 100-best “Hall of Fame” by appearing on the list every year since it was first published in 1998.



Restates intention to remain independent rather than be acquired by or merge with another company.

INSIDER SCOOP



Outsources a portion of its IT operations to Kanbay Inc.; lays off about 40 IT employees.



In Registered Rep. magazine’s survey of brokers working in the industry, the firm scores highest in six categories: Freedom from Pressure to Sell Certain Products, Realistic Sales Quotas, Hiring and Recruiting Practices, Payout, Benefits, and The Quote and Information System.

The Inside Scoop Quiet and Steady Despite its recent brush with the SEC, Edwards is known as a straight shooter—a bit stodgy and behind the times, perhaps, but a company you can trust to take good care of your money. As one insider puts it, “A.G. Edwards is quiet, very conservative, and it moves deliberately and cautiously.” That tempered approach translates into a working environment in which employees are encouraged to uphold the firm’s squeaky-clean image.

INSIDER SCOOP “We’re the Boy Scouts of the industry—we’re never the first kids in the swimming pool.”

Branch Camaraderie Employees at branch offices like to hang out together and socialize. The mood is low-key, casual, and collaborative. “You have experienced people that you can rely on for help,” an insider says. When comparing the firm with others in the industry, another says, “Here, it’s a family atmosphere. Every broker in the office has an open door, and there’s no one I wouldn’t ask a favor of.”

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The Firms

“I chose to work for Edwards because the firm has no proprietary products, no conflicts of interest for the brokers, limited investment banking, and the most generous retirement plan in the business.”

Launches a nationwide advertising campaign, the first in its history.

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2004

25 Top Financial Services Firms Make Your Own Way Being a broker is kind of like having your own business, even when you work for a big firm like Edwards. How much money you make depends in part on how successful you are finding and keeping clients. “I think any commission-based position can be frustrating for a new employee, because you control your own destiny, good or bad,” a broker says.

INSIDER SCOOP the industry

“This is not a job for people who are not willing to work for their future.”

All Walks of Life Who is the typical Edwards broker? Employees say there’s no such thing—and that recruits come from all walks of life. The only common denominators are a strong work ethic, good morals, and a sense of loyalty. “I have met top producers in the firm of every shape, size, and demeanor you can imagine,” an insider says. “There’s no mold.”

Getting Hired Edwards’ hiring plans are in flux due to the Wachovia acquisition, but it typically has offered employment opportunities to entry-level and experienced candidates in all the usual corporate functions at financial services firms—in other words, in jobs from corporate communications and marketing to brokerage operations to accounting and legal. In addition, it employs an array of research associates and analysts, as well as investment-banking professionals. Finally, since financial advisory is the heart of what this firm does, it’s always on the lookout for qualified financial consultants, as well as strong entry-level candidates to enter the financial-consulting field.

The Firms

Undergraduates and MBAs Edwards recruits undergrads and MBA candidates for I-banking positions. Undergrads are hired into two- to three-year analyst positions; MBAs come onboard as associates. Analysts typically work in emerging growth markets (technology, health care), financial 10

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institutions and real estate, or energy (oil and gas, utilities). In addition, associates may work in mergers and acquisitions and private placements. Because the firm has a small I-banking group, new hires there have more responsibility and faster promotion rates, according to insiders. Recruiting for I-banking positions starts in September at select schools nationwide, with onsite visits in early November. Associates are hired from the Top 20 business schools, and candidates need at least three years of related work in I-banking, public accounting, or financial industry experience, in addition to an MBA. For both would-be analysts and would-be associates, the process consists of an initial interview on-campus, followed by a full day of interviewing at the home office in St. Louis. Qualifications for undergrads include a degree (preferably in finance) and a minimum of nine credit hours in accounting. Edwards has recruited undergrads and MBAs— particularly women and minorities—for its nationwide network of financial consultants. Recruiters say they want candidates with entrepreneurial initiative, resiliency, and social skills. Any major is acceptable. Candidates must make it through an in-depth application and screening process (involving FBI background checks) before interviewing with branch managers, who make the final hiring decisions. Although Edwards is always looking to hire, one recruiter says, “It’s quality, not quantity.” Recruiting for summer associate positions begins in February.

Midcareer Candidates Midcareer candidates usually fill financial consultant positions. There’s a 19-week paid training program; follow-up training focuses on business development and prepares you for your second year. During the training period, commissions gradually supplement compensation paid. After the first year, you work solely on commissions. Edwards offers incentive bonuses monthly during the first year, quarterly during the second, and annually thereafter. First-year financial

the industry

consultants, on average, have made between $40,000 and $50,000; the Top 10 percent of Edwards financial consultants with five years of experience can earn about $280,000. Insiders say an MBA is not a great predictor of success. Each broker determines his or her own hours, but that doesn’t mean kicking back—one insider says she works a 60-hour week. Depending on the client base, the amount of travel can vary. One insider with a diverse clientele says he drives 1,500 work-related miles a month. Finally, job seekers be aware: Wachovia plans to close as many as 230 of the future combined brokerage’s 3,350 offices within three years and cut roughly 4,000 jobs—one-fourth of workers who are not Series 7 brokers. This should result in $395 million of annual cost savings for the combined company.

Recruiting Contacts For financial consultant positions, send your resume to [email protected]. For home-office opportunities, including securities research and analysis opportunities, complete the application on the firm’s website or send your resume to [email protected]. For investment-banking opportunities, if the company does not recruit at your school and/or you’re an experienced candidate, email your resume to corpfin@ agedwards.com.

Key Numbers 2007 2006 1-Yr. Change (%) 2,751

13.6

Worldwide earnings ($M) 331

238

39.1

Number of employees

15,338 15,480

The Firms

Worldwide revenue ($M) 3,126

-1

Fiscal year: March 1 through February 28 or 29 Sources: Firm’s website and annual report, Hoover’s, WetFeet analysis

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25 Top Financial Services Firms

American Express World Financial Center 200 Vesey Street New York, NY 10285 Phone: 212-640-2000 Ticker: AXP www.americanexpress.com

The Firms

the industry

Overview American Express operates so many businesses it’s getting harder and harder to leave home without one of them. The company’s operations range from charge and credit cards and online banking to travel services and publishing (Departures, Food & Wine, and Travel & Leisure are among its titles). The world’s largest travel agency, American Express has some 2,200 locations and more than 60 charge and credit cards. It’s one of the biggest charge- and credit-card companies around. But the company hardly rests on its laurels. The year 2005 was a fateful one for American Express, which spun off a number of businesses to concentrate on the high-growth, highly profitable cards business and improve its bottom line. The spin-off of American Express Financial Advisors, now known as Ameriprise Financial, created an independent entity with more than 2.5 million clients and assets under management totaling $410 billion. American Express also sold its Tax and Business Services division to H&R Block, its U.K.-based American Express Financial Services Europe to TD Waterhouse and its equipment leasing business to Key Equipment Finance. As the company’s Global Network Services (GNS) business gains momentum, it’s able to devote more capital to the cards and related businesses. GNS is the result of a 2004 court ruling that let American Express issue cards in tandem with banks that had been unable to issue American Express cards because they were Visa or MasterCard issuers.

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American Express expanded globally in 2006, introducing cards in China (in partnership with Industrial and Commercial Bank of China), Russia (in partnership with Russian Standard Bank), and Tahiti, as well as Eastern Europe. Less positively, in June of 2007, American Express disclosed in a Securities and Exchange Commission 10-Q filing that its subsidiary American Express Bank International is involved in a Department of Justice money–laundering probe and during the first quarter of 2007 the company established a reserve in the amount of $60 million for regulatory and legal matters at AEBI.

Recent Milestones 2007

Announces a new program that lets clients place monthly mortgage payments on credit cards and earn rewards points.

Key Numbers 2007 2006 1-Yr. Change (%) Worldwide revenue ($M) 27,136

24,068

13

Worldwide earnings ($M) 3,707

3,734

-1

Number of employees

65,400 65,800

-0.6

Fiscal year: January 1 through December 31 Sources: Firm’s website and annual report, Hoover’s, WetFeet analysis

Launches an “intelligent” online market for business travelers, connecting more than 135,000 suppliers and service providers.



Named to Fortune’s annual list of the “100 Best Companies to Work For,” as it has every year since 2004.

2006

Named to Fortune’s “America’s Most Admired Companies” list.



Ranks 30th in DiversityInc.’s annual list of “Top Companies for Diversity.”

sues Visa and MasterCard issuers Bank of America, Capital One, Household Bank, JPMorgan Chase, Providian National Bank, U.S. Bancorp, USAA Federal Savings Bank, and Wells Fargo for damages for business lost due to Visa’s and MasterCard’s unfair business practices.



Announces launch of American Express card in Serbia, Slovakia, Bosnia and Herzegovina, and Tahiti.



Signs agreement with Bradesco for the latter to assume Brazil operations of American Express.

2005

H&R Block acquires American Express’s Tax and Business Services division. Named to Working Mother’s list of “100 Best Companies.”





Announces it will offer cobranded card with JetBlue.



Announces plans to spin off its American Express Financial Advisors subsidiary.



2004

The Inside Scoop Free Your Mind American Express has a strong brand and continually offers more products, making it a great place to work for young people with innovative minds.

INSIDER SCOOP “It’s a creative environment, with people spinning cool ideas. It always looks great on a resume.”

Delivering Diversity Diversity is a source of pride at American Express, and insiders speak to the benefits of CEO Ken Chenault’s leadership. “There’s excellent diversity at Amex, especially in terms of women,” an employee says. “People think of diversity in many different ways at Amex, which probably has something to do with Chenault and the required diversity training.”

Great Expectations Employees say American Express lets employees know exactly what’s expected of them from the moment they’re hired. Performance reviews are taken seriously and are directly related to compensation.

INSIDER SCOOP “You always know where you stand relative to your coworkers and why.”

The Firms



Launches new prepaid Travelers Cheque Card, which can be used in lieu of paper traveler’s checks. Announces it will offer cobranded cards with MBNA and Citigroup.

Cuts 2.5 percent of staff in restructuring and the sale of some overseas businesses.

the industry



In the wake of the Supreme Court’s refusal to hear Visa and MasterCard’s appeal of a government antitrust suit against them, WETFEET INSIDER GUIDE

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25 Top Financial Services Firms Find Your Patron Some insiders claim that finding success at American Express depends on who you know as much as what you do. As a result, it pays to have friends in high places.

INSIDER SCOOP “It’s definitely an organization where relationships matter.”

The Firms

the industry

Getting Hired As you might expect, a company with such a diverse range of businesses offers many employment opportunities. Perhaps you’d fit in best in a central corporate function, such as strategic planning and business development, finance, risk management, human resources, or technology. Maybe you’re interested in working in the company’s consumer-cards business. Or in corporate or consumer travel. Or the Travelers Cheque group. Maybe you’d make a good internal auditor, or you’d do well selling corporate cards to other companies. Whether you’re a marketer or a techie, a customer-service professional or a financial analyst, there’s a place for you somewhere at American Express. American Express does extensive recruiting for a wide range of financial and marketing positions at its headquarters and regional offices. Recruiters visit career fairs, minority conferences, and top business and technical schools nationwide (as well in Europe and Japan). Recruiters assess candidates in a first-round behavioral interview followed by onsite follow-up sessions that consist of one-on-one meetings with three to five different people. Hiring criteria include quantitative and analytical skills, related work experience, and previous internships. Whether they’re interviewed on campus or at an American Express office, job candidates will be notified within two weeks of the status of their application and any next steps.

Undergraduates and MBAs The company customarily hires MBAs and some undergrads into positions in marketing, finance 14

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and accounting, strategic planning and business development, IT, project management, human resources, risk management, operations, and interactive. Depending on which unit they’re hired into, American Express’s top MBA, master’s and PhD recruits may enter a Global Express program, which gives participants a chance to experience a variety of roles as well as exposure to leaders within the company. These programs also take on high performers who are already working at American Express. Summer internships are offered primarily in New York, London, and Singapore. In recent years, the firm has offered 150 to 175 summer internships.

Midcareer Candidates Opportunities for midcareer candidates are posted online, though insiders say many of these positions are filled internally.

Recruiting Contacts If you cannot participate in on-campus events at the more than 20 schools American Express visits or diversity recruiting events, apply for open positions online at www.americanexpress.com/careers.

Bank of America 100 North Tryon St. Charlotte, NC 28255 Phone: 704-386-5681 or 800-333-6262 Ticker: BAC www.bankofamerica.com

Overview

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The Firms

the elimination of some 6,000 jobs; in 2004 the firm had announced 12,500 job cuts in connection with the acquisition of FleetBoston. BofA has gotten some public criticism for the way it’s handled layoffs following mergers. Some observers charge that the bank reneged on assurances that it would retain its commitment to jobs in San Francisco after the NationsBank merger with BankAmerica, when the bank cut some 30,000 jobs through attrition and layoffs. Critics of the bank aired similar complaints after the Fleet acquisition. Globally, BofA is making its mark as well. In 2006 it moved to purchase the Chicago-based LaSalle Bank from Dutch giant ABN AMRO for $21 billion. That deal may be nixed, however, if an international group intent on keeping LaSalle acquires the Netherlandsbased company. Prior to that, BofA exchanged its BankBoston operations in Brazil for stock in Banco Itaú, Brazil’s second-largest non-government-owned banking company. In 2005, it also bought a 9 percent stake in the China Construction Bank. Bank of America Global Corporate and Investment Banking (see next chapter) is the bank’s investment banking arm. Other business lines include consumer banking, commercial banking, and wealth and investment management. Financially, the bank is quite healthy, though some claim it paid too dearly for some recent acquisitions.

the industry

In less than a decade, Bank of America has truly become the bank of America. The second-largest bank in the U.S. (after Citigroup), BofA has nearly 5,700 locations in 30 states and the District of Columbia, and is the nation’s top provider of debt and credit cards, serving more than 54 million customers. BofA’s rise to the top was meteoric. Just seven years ago, the basic current incarnation of the bank was formed from the merger of North Carolina’s NationsBank and San Francisco’s BankAmerica; the deal created the country’s first coast-to-coast bank. Then in 2004, BofA acquired FleetBoston, a major Northeastern retail and commercial bank. Last but not least, BofA completed its acquisition of MBNA on Jan. 1, 2006, doubling its credit–card customer base and income from card fees. In 2007, BofA acquired wealth-management firm U.S. Trust. Federal law prohibits any bank from surpassing more than 10 percent of domestic deposits via acquisitions, and the MBNA grab put BofA within hailing distance of that mark. As a result, BofA has undertaken some counter-intuitive moves–such as lowering interest rates on deposit and checking accounts in the state of California—with the possible intention of driving off new or even existing customers. BofA currently holds roughly 9.7 percent of all domestic deposits. Quick growth has been far from painless for BofA’s workforce as well. The MBNA acquisition resulted in

25 Top Financial Services Firms Recent Milestones 2007



Listed as one of “100 Best Companies” by Working Mother magazine.

2004

Announces a $600 million windfall via the sale of private equity funds to Conversus Capital, which it partially owns.

Announces acquisition of National Processing, a credit-card-transaction processing company.



Fined $1 billion in class-action lawsuit over mishandling of customers’ Social Security direct deposits.



Shifts from giving stock options to giving cash bonuses to employees making less than $100,000 per year.

Expands an existing program to allow $3,000 reimbursements to up to 185,000 BofA employees if they purchase a hybrid vehicle.



2006

Completes acquisition of MBNA.



Alvaro de Molina replaces retired CFO Marc Oken.

2005

Announces acquisition of MBNA for $35 billion.



Agrees to buy 9 percent stake in China Construction Bank for $3 billion.



Security breaches result in loss of information security for hundreds of thousands of BofA accounts.



Acquires KeyCorp’s $995 million auto loan portfolio.



Pays $375 million to settle SEC allegations that it allowed clients to make illegal market-timing trades.



Announces plan to give employees bonuses—most would get a minimum of $500—if the bank reaches earnings goals for 2005.

The Firms

the industry



Purchases U.S. Trust for $3.3 billion in cash from Charles Schwab, which it merges with its own Private Bank.

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The Inside Scoop A Ginormous Bank Already a gargantuan bank with a variety of cultures, after the Fleet and MBNA acquisitions BofA is anything but a place with a uniform culture. In other words, your workplace atmosphere can vary widely, depending on where you work in the bank’s

As BofA has grown, some employees have noted that the atmosphere in some parts of the organization has become less easygoing. On the flipside, those driven to improve the bottom line—and reap the rewards—seem to thrive on the intensity.

organization and where you work geographically. And with its mammoth size, unfortunately, comes mammoth bureaucracy—in some areas of the organization, management can make employees feel more like numbers than people.

Good News, Bad News Bank of America is an aggressive institution (just ask all the other financial services firms it’s absorbed in recent years). People who do well at the bank often have a relentless drive to succeed and a laserlike focus on improving the bottom line.

Any time a company lays off significant numbers of employees, it can cause stress in the ranks. Depending on where you work in BofA, this may be something you have to deal with, though the most recent year on record reversed the recent trend of employment cutbacks.

Getting Hired Bank of America is a truly huge bank with a ton of different careers—and a ton of different specific hiring processes. The list of jobs available is long and includes customer support, collections, relationship management, consumer lending, mortgage banking, e-commerce, card services, marketing and communications, finance, legal, IT, operations, asset management—we could go on all day.

Undergraduates and MBAs The bank recruits undergrads and MBAs at topand second-tier schools across the country. It hires undergrads into positions such as treasury, commercial banking, consumer banking, consumer products, financial management, operations, transaction services, technology, risk management, and supply chain management. It often recruits MBAs for positions in consumer banking, corporate quality and productivity, consumer products, financial management, HR, technology, and operations. The bank also offers undergrad and MBA internship opportunities.

Midcareer Candidates

the industry

Don’t Fear the Reaper

You can search for jobs on the company’s website, and register your resume in its database there.

Check out job listings online at www.bankofamerica. com/careers. It always helps to have an internal referral, so make contacts inside the firm before you send in your resume.

Recruiting Contacts You can learn how to apply through the corporate website at www.bankofamerica.com/careers.

Key Numbers

2006

2005

1-Yr.

Change (%) Worldwide revenue ($M) 117,017 83,980

39

Worldwide earnings ($M) 21,133

28

203,425 176,638

15

The Firms

Number of employees

16,465

Fiscal year: January 1 through December 31 Sources: SEC filings, Hoover’s, WetFeet analysis

WETFEET INSIDER GUIDE

17

25 Top Financial Services Firms

Bank of America Global Corporate and Investment 100 North Tryon St. Charlotte, NC 28255 704-388-2547 www.bankofamerica.com

The Firms

the industry

Overview The Global Corporate and Investment Banking (GCIB) division of Bank of America was formed after the $64 billion merger between BankAmerica and NationsBank in 1999; it began as Montgomery Securities in 1971, and was acquired by NationsBank in 1997. Known for its top-tier debt division and solid expertise in high-tech, GCIB (formerly known as Banc of America Securities) is on the move in other areas as well. Expanding beyond its roots in tech-centric San Francisco, the company is centering its business in New York and increasing coverage in several areas, including M&A, convertible debt, syndicated finance, high-yield securities, and prime brokerage. Meanwhile, it is bolstering its European equity business through its London affiliate. In recent years, the firm has snapped up talent from the likes of Goldman Sachs and Morgan Stanley; in 2005, it hired U.S. M&A head, Andrew Bednar, away from Goldman, creating the position especially for him. GCIB has as an advantage (at least theoretically) over its purebred I-banking peers: the backing of a top commercial bank, which means deep pockets and a broader array of product offerings at clients’ disposal. It has offices in more than 44 countries around the world, including operations in Frankfurt, London, and Tokyo. Like other banks, it sees China as a land of opportunity; it bought a 9 percent stake in China Construction Bank in 2005 and has the option to move that ownership position up to nearly 20 percent within five years.

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Like other investment banks, during the slack M&A market that followed the stock market downslide in the early 2000s, the firm eliminated its M&A group, reassigning its M&A bankers to specific industry banking groups (Bednar now works for an independent financial services firm). Unlike some of those other banks, GCIB has not re-formed its M&A group, saying it prefers the deep industry knowledge its bankers can bring to the table when advising M&A clients under the new organizational structure. Not unlike other big investment banks (which need to replace departing analysts and associates every year), the firm recruits consistently at the college and MBA levels for summer internship programs and to fill some full-time slots. As one insider says, “There’s never a bear market for great talent.”

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) $22,691 $20,600

10

Worldwide earnings ($M) $6,792 $6,384

7

Fiscal year: January 1 through December 31 Effective 1/1/06, Bank of America combined its Global Capital Markets and Investment Banking and Global Business and Financial Services segments to form a new segment, Global Corporate and Investment Banking; 2006 numbers are for this new segment. Sources: Bank of America GCIB, WetFeet analysis

Recent Milestones CEO Thomas G. White succeeds Mark B. Werner, who resigned.

2006

Named to the Black Enterprise magazine list of most diverse companies.

2005

Named to Working Mother’s list of “100 Best Companies.”

2004

Launches an electronic trading services group to develop and deliver electronic trading products to institutional investors.

The Inside Scoop

describes differing managerial demands, saying, “Work styles vary. Some supervisors demand a lot of face time whereas some just expect you to crank out good work.” All in all, it’s a friendly environment, but not a kickback one.

INSIDER SCOOP “If you have a personal emergency or pressing event, people are very understanding and willing to pick up the slack for each other, but at the end of the day you are expected to perform at a certain level and that means a lot of sacrifice. People who aren’t aware of this coming into the business leave very quickly.”

Down, Set, Hike!

Getting Hired

The atmosphere is frankly “feel-good” and even “enjoyable”, apart from the stray power tripper, insiders say.

GCIB is always committed to finding top talent. Fulltime positions and summer internships are primarily in Charlotte, New York, and San Francisco. A majority of these entry-level positions are filled through oncampus recruiting (which starts in September with the nation’s top colleges and MBA programs). Recruiters stress that work experience and academic achievements are the key factors in hiring decisions. Strategic and creative thinking are valued, as well as leadership skills and a strong work ethic. A finance-related major is not required, but financial knowledge is key.

INSIDER SCOOP “It’s an extremely work-hard, play-hard mentality. We go out as a group and have a lot of fun in the office, sometimes throwing a football around during a discussion to lighten the atmosphere.”

Go, Team! Insiders say that the firm’s entrepreneurial ethic rewards individual achievement, but a team spirit endures. One says, “We’re working toward a common goal to make the entire bank better, so everyone feels like their work matters.” Even during the last bear market, the company continued to move forward. An analyst says, “Morale is incredibly high here, because we are still thriving and growing. There’s a lot of energy around building something new, rising to the top versus maintaining a status quo.”

Insiders give management a thumbs-up. Says one insider, “They are committed to keeping morale high. They know how much effort you are putting in, which they very clearly appreciate.” However, another insider

INSIDER SCOOP “You only need to be smart, have the commitment, and be willing to learn. They are willing to teach you everything you need to know.” For undergraduates who start out as analysts, the promotion bar to associate level has risen considerably, reverting to a prebubble standard. Expect to pay your dues. Analysts routinely put in two or three years before becoming associates, and getting your MBA is strongly encouraged for this position—though not required. It takes another three years or so to make vice president. There is the rare exception for superstars: “Performers will be rewarded accordingly,” one insider says. WETFEET INSIDER GUIDE

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The Firms

Nurture Reserve

the industry

2007

25 Top Financial Services Firms

the industry

Undergraduates and MBAs Undergraduate and MBA students can apply for internships and entry-level positions in fields including corporate and investment banking, debt capital markets, equity sales and trading, equity research, debt markets sales, trading and research, global portfolio management, and financial engineering and trading technology. Most summer associates receive full-time offers. GCIB usually recruits for analysts at some 40 top U.S. campuses and for associates at about 20 schools. Campus recruiting typically begins with presentations in September, followed by on-campus interviews.

Midcareer Candidates Check out job listings online at www.bankofamerica. com/careers. It always helps to have an internal referral, so make contacts inside the firm before you send in your resume.

Recruiting Contacts

The Firms

If you are unable to participate in on-campus recruiting, you can learn how to apply through the corporate website, at www.bofa.com/careers.

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Bear Stearns 383 Madison Avenue New York, NY 10179 Phone: 212-272-2000 Ticker: BSC www.bearstearns.com

Overview

INSIDER SCOOP “The hedge fund situation has definitely affected morale. There has obviously been a lot of press and it has not been good. There have been some changes in management as a result, and some restructuring. So I would say people are a little bit cautious, but I think, in general, everyone is working extra hard to move forward and get past whatever setbacks there may have been.”

WETFEET INSIDER GUIDE

21

The Firms

The firm—headquartered in a state-of-the-art Manhattan skyscraper capped with a seven-story crown atop a 45-floor octagonal building—operates three main segments: Capital Markets, Global Clearing Services, and Wealth Management. Capital Markets includes fixed income (mortgage-backed securities, asset-backed securities, corporate and government bonds, municipal bonds, high-yield, foreign exchange, and fixed-income derivatives), institutional equities (domestic and international sales, trading, and research), and investment banking (underwriting, M&A, and merchant banking). Global Clearing Services comprises clearing, margin lending, and securities borrowing for short-seller clients. Wealth Management provides private client services and assetmanagement services. Bear boasts key operations including prime brokerage services, asset management, and high-yield and mortgage-backed securities underwriting. The firm has stepped up in the U.K. and Japan, and in 2006 it purchased half of Israel-based Migdal Capital Markets.

the industry

Bear Stearns made front-page news in 2007, but it wasn’t the sort most people enjoy reading. Founded in 1923, the small but pugnacious firm has always had a reputation for aggressive trading— and in June, Bear rocked the financial world when it revealed it had lost virtually every penny of billions of dollars two of its hedge funds sank into risky subprime mortgage securities. Only a $1.6 billion line of credit averted a further meltdown. At it was, Bear triggered stock devaluations and overall hand-wringing among the many companies with investments in the depleted hedge funds or a stake in the subprime mortgage game. Up until the summer of Bear’s discontent, things had been on the up-and-up after several trying years. Like many of its Wall Street neighbors, Bear suffered through hard times during the market downturn of the early 2000s; the firm endured layoffs for the first time in its history, trimming 1,300 employees from its ranks in 2001. However, its losses were relatively minor and in 2002, Bear’s mortgage-backed bond business helped it post a 42 percent increase in net income. Bear, which entered into investment banking in the early 1990s, handles roughly 10 percent of all trades on the New York Stock Exchange. And despite the specter of a lawsuit from banking giant Barclay (which lost up to $400 million in the hedge fund fiasco), The Wall Street Journal notes that “it’s not all doom and gloom. Subprime remains a small—and manageable— percentage of overall business for Bear and other investment banks.”

the industry

25 Top Financial Services Firms Although Bear lacks the capital base of its rivals, insiders say that it’s a strong competitor because it doesn’t have a blanket approach to finance. “We’re very strategic in the areas we go after,” says a banker. “When we win business, it’s not because of the franchise name. It’s based on the ideas and creativity of the bankers involved in pitching that business.” In addition, the firm’s frugality relative to many of its competitors has helped it perform consistently well. In 2006, Bear was slapped with a hefty $250 million fine by the NYSE and the SEC for fraudulent market timing and late trading of mutual funds. Bear Stearns has locations in New York (Manhattan and Brooklyn); Atlanta; Boston; Chicago; Dallas; Denver; Los Angeles; San Francisco; Beijing; Dublin; Hong Kong; London; Lugano, Switzerland; Milan; San Juan, Puerto Rico; São Paolo; Shanghai; Singapore; and Tokyo.

in U.S. target announced, and 21st in worldwide announced in M&A advisory (Thomson Financial League Tables). 2006

Purchases 50 percent of Migdal Capital Markets in Israel.



Fined $250 million by the NYSE and the SEC for fraudulent market timing and late trading of mutual funds.

2005

Launches Bear Stearns Residential Mortgage, which extends the firm’s mortgage offerings by providing mortgage brokers with automatic loan underwriting.



Acquires a stake in Essex & Capital Mortgage, a U.K. mortgage broker specializing in the subprime market. The company will aggregate loans from brokers and consumers and place them with lenders.



Fortune names Bear Sterns a “Most Admired” securities firm.

2004

Expands coverage of large-cap companies in Eastern Europe, the Middle East, and Africa.



Bear Stearns Asset Management acquires Measurisk, a provider of risk-transparency and risk-management solutions; the private equity specialty finance business of BDC Financial, which provides investment management and advisory services to private equity investors; and the fixed-income portfolio management group of TimesSquare Capital Management, a unit of Cigna.



Sells its mutual fund management business to Dreyfus Corp.

INSIDER SCOOP “There’s no white-shoe pedigree here. No one cares who your dad is.”

Recent Milestones 2007



The Firms





22

In the wake of near-total losses in two hedge funds, Richard Marin is ousted as chairman and chief executive of Bear Stearns asset management and replaced by Jeffrey Lane. Marin remains as a senior adviser to Lane. Launches an energy business in Europe that will trade in natural gas, electricity, emissions, oil, and refined products. Announces the formation of Bear Stearns Arabia Asset Management to be headquartered in Riyadh, Saudi Arabia. The company will “develop and distribute Sharia-compliant” investment projects. In the second quarter of the year, ranks 13th in U.S. target completed, 17th

W E T F E E T I N SIDER GUIDE

The Inside Scoop Running with Rope

INSIDER SCOOP “There’s nobody holding your hand, but there’s no one BS–ing you.”

The Paper Clip Chase As a smaller, scrappier player, Bear watches its costs a bit more fervently than some of its competitors do. That means keeping a sharp eye on everything from staff salaries to paper clips (Bear’s venerated former CEO Ace Greenberg was infamous for his memos about conserving office supplies). But employees say that the paper clip example symbolizes the company’s responsible attitude. “There isn’t even really a supplies closet. You have to order everything and all your expenses are tracked to you,” says one vice president. “If you want a fancy mouse pad, the managing director of your department will see you’re ordering it.” Still, this reinforces the notion that Bear is a “bottom-line place”—and the bottom line is “spending money on stupid things is stupid.”

Keep Up the Pace

Insiders say that they get along well with their colleagues and there’s a lack of rivalry in the ranks. “I’m surprised that promotions aren’t competitive. There’s room for everyone,” says one. Another says, “The best perk is that my colleagues are my best friends.” Both recruiters and insiders also highlight the camaraderie between employees at different levels in the organization.

INSIDER SCOOP “There’s definitely a deep-rooted interest in senior managers to make sure the young people are on track. I play golf with managing directors.”

Getting Hired Proving that you’re ready to work at Bear is not a matter of conforming to a particular type; it’s more about showing you can get along with colleagues from all walks of life. Entry-level hires come from a spectrum of colleges and backgrounds. And having fancy connections or academic credentials won’t necessarily help you. “There’s no white-shoe pedigree here,” an insider says. “No one cares who your dad is.” One recruiter says it’s the least pedigree-conscious firm on the Street. And if you’re hoping to make an impression on CEO James “Jimmy” Cayne because you graduated from the same college, don’t bother. He never finished his degree. Still, a finance degree is an asset—but the firm strongly believes in hiring candidates from a variety of disciplines. “Once you’re in the door, they are quite blind to what you were doing before,” a former lawyer says. “They are willing to give you the time because they see you have the potential to climb the learning curve.” The best advice for job seekers, some say, is to be yourself. WETFEET INSIDER GUIDE

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The Firms

An analyst warns that it isn’t possible just to coast at Bear, which demands a high degree of productivity from its employees. “It’s hard not to be busy, even in the down market, so junior people really can’t hide if they’re just sitting around,” he says. That said, don’t expect your manager to watch your every move. “You don’t have to stay until your boss leaves,” another

Come Together

the industry

Insiders say Bear is a company where self-starters can thrive, but those needing more direction from their managers may not be as happy. “This is not a day–care center where you’re going to be reprimanded for everything you do wrong. If you’re not on your game you may find yourself after six months or a year being told this isn’t working out,” says one employee. Another says, “There’s no limitation on what people will allow you to do here. They will give you as much rope as you can [use] to run with. I’ve advanced more here than I would have at other firms.”

insider says. “You can leave at 4:00 p.m., though you can be paged.” A veteran employee told us he worked 12-hour days in his first three years at the company and has worked 10-hour days for the past four.

25 Top Financial Services Firms INSIDER SCOOP

Midcareer Candidates

“In the interview, what it boils down to is, ‘Who do I want to hang out with in an all-nighter?”

Bear hires midcareer professionals for entry-level and senior positions on an as-needed basis through online job postings and headhunters, but those interested should network to find their own openings.

The firm’s campus recruiting starts with on-campus presentations in September at top schools nationwide, with an emphasis on those institutions in the New York area. Interviews are one-on-one. The positions are filled where needed. Undergraduate and graduate students can submit resumes for full-time positions beginning in September and in mid-November for summer positions.

Undergraduates and MBAs Undergraduates typically apply for analyst positions in asset management, controllers, fixed income, institutional equities, investment banking, operations, prime brokerage services, private client services, and risk management. Graduates tend to fill associate positions in asset management, equity research, financial management, institutional equities, and investment banking. Undergraduate and graduate hires in I-banking go through a brief rotational program before being placed in a group. All new hires also go through structured training programs involving mentoring and internal classroom training. Bear does limited recruiting for summer internships; undergrads usually undertake internships in asset management, controllers, fixed income, institutional equities, investment banking, and risk management. MBA candidates gravitate toward internships in asset management, financial management, investment banking, equity research, and institutional equities. Overseas internships are available in Europe for grads and undergrads. It’s not unusual for Bear to take on 500 summer interns, all of whom are paid hourly wages.

The Firms

the industry

.

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Recruiting Contacts Bear encourages qualified candidates who cannot participate in on-campus recruiting to send a resume and cover letter to the appropriate recruiting manager online. Visit www.bearstearns.com for more information.

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 16,551

11,552

43.3

Worldwide earnings ($M) 2,054

1,462

40.5

Number of employees

13,566 11,843

14.5

Fiscal year: December 1 through November 30 Sources: Firm’s website and annual report, SEC filings, Hoover’s, WetFeet analysis

Capital One Financial 1680 Capital One Drive McLean, VA 22102 Phone: 703-720-1000 or 800-801-1164 Ticker: COF www.capitalone.com

Overview

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 15,191

12,085

25.7

Worldwide earnings ($M) 2,415

1,809

33.5

31,800 21,000

51.4

Fiscal year: January 1 through December 31 Sources: Firm’s website and annual report, SEC filings, Hoover’s, WetFeet analysis

WETFEET INSIDER GUIDE

25

The Firms

Number of employees

renegotiated down to $5 billion, a 9 percent lower price than Capital One initially offered). And in 2006, it acquired North Fork Bancorporation for $14.6 billion in stock and cash. That pickup gave the company more than 250 bank branches in New York, New Jersey, and Connecticut and vaulted Capital One into the ranks of the 10 largest banks in the U.S. The conventional banking business is simply booming for Capital One. It has 725 bank branches in a handful of states and roughly 13,000 of its nearly 32,000 employees are on the bank side. The company reported a 36 percent rise in second-quarter 2007 earnings with net income of $750.4 million, and Capital One’s total bank deposits at the end of the second quarter of 2007 stood at $74.5 billion—more than double the $35.3 billion at the close of the first quarter of 2006 (prior to the North Fork deal). But credit cards are still the company’s calling card. It launches new types of cards with amazing frequency—prepaid cards, subprime cards, specialinterest cards for customers with a wide range of interests (such as chess players) and affiliations (people of Irish heritage), platinum and gold cards, and so on. Even the Hibernia acquisition took place to benefit the cards business; Capital One bought the bank partly because it can use Hibernia’s deposits to fund the expansion of its cards business. But it’s not as if there haven’t been speed bumps in Capital One’s path in recent years. After federal regulators raised concerns about its large number of high-risk cardholders, in 2002 Capital One agreed to bolster its cash reserves and take other steps to reduce

the industry

It’s likely you know this company from its amusing commercials featuring hordes of barbarians shouting “What’s in your wallet?” But Capital One has done more than just create work for actors who resemble Vikings. The rising star in the credit-card and financial services industry has built a successful business in the U.S., Canada, the U.K., and France since launching in 1988. The company is one of the top credit-card issuers (holding almost 50 million accounts) and operates in mortgage services, auto finance, healthcare finance, insurance, and other consumer banking and financial areas. Capitol One is known for using a proprietary data-driven methodology to determine new markets for credit cards. Its balance-transfer cards, introduced in 1991, made the company a major—and much-imitated—player in the industry. In 2005, Capital One beefed up its noncards businesses significantly with the acquisition of Hibernia, a New Orleans-based bank (the deal was delayed as a result of Hurricane Katrina and eventually

the industry

25 Top Financial Services Firms credit exposure. The company also laid off more than 1,500 call-center employees in 2003 and 2004 as part of a call-center consolidation effort. A 2007 initiative to save $700 million in operating expenses through 2009 will result in the trimming of 2,000 more jobs. Still, Capital One is on the lookout for recent college graduates and strong midcareer professionals who can fill a host of positions. (Through growth and acquisition, employee headcount grew by more than 50 percent in the most recent fiscal year.) “Capital One offers a young, friendly, enthusiastic workforce, interesting analytical work, a relaxed atmosphere, and a better work/life balance than other financial services firms,” one recent hire says.

Recent Milestones 2007

Named one of “20 Great Employers for New Grads” and “100 Best Companies to Work For” by Fortune.



The Firms

John Kanas and John Bohlsen, the banking president and head of commercial banking, respectively, step down in August. These are two of many management turnovers as Capital One focuses on its banking side. They are replaced by Lynn Pike and Michael Slocum.



Announces an initiative to reduce operating expenses and improve company’s competitive cost position, with the goal of saving $700 million in pretax operating expenses through 2009.

2006

Acquires North Fork Bancorporation, which adds bank branches in New York, New Jersey and Connecticut.

2005

Acquires Hibernia, a New Orleans-based bank with some 6,200 employees.

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W E T F E E T I N SIDER GUIDE



Acquires Onyx Acceptance, an auto loan originator.



Relocates San Diego Internet auto finance operations to Plano, Texas.

2004

Announces acquisition of eSmartloan, an online home equity loan originator.



Announces acquisition of HFS Group, a U.K. home equity loan broker.

The Inside Scoop Join Capital One, See the World Employees praise Capital One for working hard to retain and develop its personnel. An insider who had previously worked in the U.S. in emerging markets was able to land a London assignment after getting his MBA (which the company paid for).

INSIDER SCOOP “I had studied abroad in Europe, so it was a great opportunity to work for Capital One again and get paid to travel to countries we’re trying to build business in. And I have the opportunity to move to other countries where we’re expanding.”

Where the Action Is A former consultant likes having an entrepreneurial role at Capital One. “At other companies, most MBAs are in ‘back office’ jobs as analysts, whereas at Capital One you move right into line roles that run the business,” he says. And that opportunity to make an impact has attracted some high-caliber people to the company. Another says, “The one big difference working here is that the quality of talent is above and beyond other environments I’ve worked in, including consulting.” In addition to having a talented workforce, the company is diverse—60 percent of its employees are female and 35 percent are minorities.

INSIDER SCOOP “It’s a no-nonsense, get-it-done attitude—we don’t play political games. We’re a group of smart people who like to solve problems in a collaborative environment.”

Getting Hired

Undergraduates and MBAs

Midcareer Candidates Capital One is always looking for good midcareer candidates. It hires a substantial number of people each year from outside industries, especially consulting and engineering. Although most lateral hiring is done through headhunters, candidates can also apply online. Capital One has a particular appreciation for job candidates with military experience. It typically hires senior enlisted military personnel in positions like manager, trainer, and project manager; and officers in positions like manager, analyst, trainer, and project manager.

Recruiting Contacts If you cannot participate in a recruiting event, visit the company’s website at www.capitalone.com/careers.

WETFEET INSIDER GUIDE

27

The Firms

The bulk of entry-level opportunities at Capital One is for undergraduates, who can apply for analyst positions in marketing and analysis, operations, and other areas. As an analyst, you might be involved in competitive analysis; research and analysis of demographics, products, and business lines; internal reengineering projects; and developing financial and statistical models. MBAs typically work in

the industry

Capital One recruiters say they look for hardworking, creative individuals who are strategic thinkers. Most entry-level job applicants have backgrounds in business, engineering, or economics; many midcareer applicants are former consultants. Other preferred qualities include strong quantitative skills and an entrepreneurial streak. The company recruits undergraduates and MBAs at top-tier schools, with an emphasis on East Coast campuses; in recent years it has scouted undergrads at Cornell, Duke, Georgia Tech, Harvard, Stanford, U. of Maryland, U. of Michigan, U. of Pennsylvania, U. of Texas, U. of Virginia, Virginia Tech, Wellesley, and Yale, and MBAs at Darden (U. of Virginia), Harvard, Stanford, and Wharton (U. of Pennsylvania). It also recruits in Canada and the U.K. Like its business model, the recruiting process is data-driven—the company puts faith in a number of objective hiring measures that predict on-the-job performance. When you meet with a recruiter, you can bank on behavioral interviews, case interviews, work samples, and tests (quantitative and work preferences). Interviews are either one-on-one or two-on-one. A recent recruit describes the process as relaxed, saying, “The interviewers were friendly people, and they had a better attitude than those I’ve met at other firms.”

business manager positions in marketing and analysis or operations, where they help generate new products, launch new businesses, engage in business-development efforts, and oversee analysts. The company also brings on undergrads and MBAs in summer-internship versions of these positions. Capital One likes to see quantitative and analytical excellence, including quant- and analysis-heavy majors and academic concentrations, in hires for all these positions. The company also hires undergraduates and MBAs in finance and treasury, legal, human resources, sales management, information technology, administration, and accounting and audit. Capital One offers training programs for new hires, but some say most of the learning comes once the work begins. “You learn the job on the job,” a veteran says. “We’ve taken steps to improve training, but it could be better.” Capital One reimburses employees for undergraduate- and graduate-degree tuition if the area of study pertains to its businesses. (Reimbursement is often 100 percent for public institutions and 80 percent for private schools.)

25 Top Financial Services Firms

Charles Schwab 101 Montgomery Street San Francisco, CA 94104 Phone: 415-636-7000 or 800-435-4000 Ticker: SCHW www.schwab.com

The Firms

the industry

Overview Charles Schwab is such a well-known company, it’s almost easy to forget that its namesake is a real person. In fact, Charles Schwab is the CEO of Charles Schwab and he owns 18 percent of his company’s stocks. His company is famous for its imaginative use of marketing and technology to deliver a range of investor services at low prices. It was founded with the idea that investors can make their own financial decisions if given objective, uncomplicated information from a trusted source, and that idea is still at the heart of the firm’s services. However, over the past few years, the company has expanded its product line to include programs where customers can receive professional investment advice for portfolio construction and financial planning, indicating a fundamental shift in its brand. Buoyed by the boom times of the late 1990s, Schwab had made a series of moves away from its roots, trying to grow its businesses by catering to wealthier investors and moving into capital markets and services for institutional investors. In 2000, for instance, it acquired U.S. Trust, which serves wealthy customers (U.S. Trust is now owned by Bank of America after Schwab sold it in 2007 for $3.3 billion). And Schwab tried to differentiate its brokerage service from other, no-frills discount brokers by offering a wealth of investment-research tools and the option of financial advisory help—and raised commissions on trades as part of the bargain. Finally, it acquired SoundView Technology Group, a stock-research firm serving institutional clients, which it combined with its capital 28

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markets business to create Schwab SoundView Capital Markets (which was later sold to UBS). But the bear market of the early 2000s was not kind to Schwab. The firm had made a mountain of money with its online trading services during the tech boom, when everybody and their Uncle Steve was getting in on the stock trading game. When that business dried up as the market went south, it really stung the firm, which laid off more than a third of its workforce between 2000 and 2003. The firm continued to struggle well into the 2000s. In 2004, with both profit losses and decreasing numbers of accounts, the firm asked David Pottruck to step down from his CEO post and replaced him with Schwab. With the former CEO back in the top seat, the company has turned things around significantly. He immediately set about refocusing the company on its core business—serving individual investors—by selling its SoundView Capital Markets business and

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 4,988

5,151

-3.2

Worldwide earnings ($M) 1,227

725

69.2

Number of employees

12,400 14,100

–11.4

Fiscal year: January 1 through December 31 Sources: Firm’s website and annual report, SEC filings, Hoover’s, WetFeet a/nalysis

2006

Schwab Equity Ratings garners first place for five-year performance, beating all Wall Street competitors in the category.

2005

Names Peter Scaturro, a former Citigroup executive, CEO of U.S. Trust.





A Schwab model stock portfolio is noted in Barron’s annual stock-selection competition for the second straight year.



2004 Asks CEO David Pottruck to step down; he’s replaced by founder Charles Schwab.



Sells Schwab SoundView Capital Markets business to UBS.



Sells its seats on the NYSE as part of its strategy to exit the capital markets business.

INSIDER SCOOP “I loved working for Charles Schwab and I would do it again in a heartbeat.”

Recent Milestones 2007

Sells U.S. Trust to Bank of America for $3.3 billion. Proceeds help fund a $3.5 billion stock buyback and special dividend. Announces that its Schwab Managed Retirement Trust Funds, created in 2002, have exceeded $2 billion in worth.



The San Francisco Chronicle names Charles Schwab CEO of the Year.



Places on Computerworld’s list of “Top 100 Places to Work in IT” for second consecutive year.

The Inside Scoop Team Oriented Employees say Schwab takes the idea of teamwork to a new level, by letting groups make product and strategy decisions collectively, rather than through a top-down approach. It’s a strategy that has both staunch supporters and critics within the organization. “Decisions are consensus-driven,” an insider says. “If you can’t handle that, you’ll get frustrated.” Another employee says, “I don’t think our level of communication is as prevalent as at other companies, but it’s harder to get things done and it can create a culture of unaccountability.”

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The Firms



Sues TD Waterhouse over that firm’s advertisements comparing Schwab to more-expensive, full-service brokers like Merrill Lynch; TD Waterhouse apologizes, and Schwab drops the lawsuit. the industry

lowering trade commissions to better compete with other discount brokers. But the firm has not turned its back on all its new businesses. According to statements in the press, the firm intends to continue enlarging its investment-advisory offerings. In addition, Schwab opened a bank in 2003, and now offers consumer banking products like mortgages and credit cards. U.S. Trust is gone, but services for wealthy investors will also continue to be a solid portion of the firm’s business. Schwab is also moving to augment its service offerings through acquisitions. In 2007 it picked up The 401(k) Company from Nationwide Financial Services for a reputed $115 million. Although Schwab has been more focused on lowering headcount than making new hires in recent years, it continues to fill open positions as needed, primarily with midcareer candidates. “In terms of mission statements, visions, and values, Schwab walks the talk,” an insider says. “It has leaders with integrity, passion, and vision beyond the bottom line.” Despite several rounds of layoffs, employees still believe Schwab is on the right track.

25 Top Financial Services Firms Minority Report

Undergraduates and MBAs

Nearly half of Schwab’s employees are female and onequarter are minorities, proving Schwab’s commitment to maintaining a diverse workforce is more than just P.R. “The eclecticism at headquarters really reflects the San Francisco culture—women, people of different ethnicities and sexual orientations are all in management positions,” an employee says. That sense of diversity also extends to the work backgrounds of employees.

Open entry-level positions for undergraduates and graduates are posted on Schwab’s website. Most of the MBA hiring is done in finance, marketing, project management, capital markets and trading, brokerage, international, and product development. But a degree isn’t always required according to one recruiter. “Because of the type of business we provide, certificates and licenses sometimes hold just as much weight as degrees. How a candidate’s level of education is evaluated varies from position to position, and from manager to manager.”

the industry

INSIDER SCOOP “There are people from the Peace Corps and liberal arts rather than finance backgrounds. As an English major, I feel more comfortable with the kinds of people who make up the staff, but the downside is that there isn’t as big a pool of people with advanced skill sets at your disposal.”

Not Merrill Lynch At a time when many financial companies are being taken to task for conflicts of interest between their brokerages and investment banking operations, Schwab prides itself on not going the investmentbanking route. “Our business model was always structured against investment banking because it is a blatant conflict of interest,” one insider says. “We are focused and passionate about the customer, not institutional clients.”

The Firms

Getting Hired Since canceling its on-campus recruiting programs in 2001, Schwab has been in a holding pattern with respect to entry-level hiring at colleges and universities. (In the past, Schwab recruited at the undergraduate and MBA level nationwide, with an emphasis on schools in the San Francisco Bay Area.) Schwab still does recruit at minority career fairs and expos across the country. Overall, hiring is taking place on an asneeded basis.

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Midcareer Candidates Currently, most midcareer hiring is done at Schwab’s investment centers. Investment specialists typically have five years of financial experience. Branch manager positions require at least six years of experience in the financial industry, with solid management experience. And private-client consultants typically have ten or more years of experience in the financial services industry. All three positions require Series 7 and 63 licenses (but Schwab frequently subsidizes employees’ expenses in obtaining those). Open job positions are posted on the company’s website.

Recruiting Contacts Schwab encourages job candidates to submit their resume and cover letter via its website, www. aboutschwab.com/careers.

Citigroup 399 Park Avenue New York, NY 10043 Phone: 212-559-1000 or 800-285-3000 Ticker: C www.citigroup.com

Overview

INSIDER SCOOP “A college degree isn’t even necessary—it’s more about your personality and work drive. We attract entrepreneurs who want to work for themselves, who are risk takers.”

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 146,558 120,318

21.8

Worldwide earnings ($M) 21,538 24,589

-12.4

Number of employees

9.8

337,000 307,000

Fiscal year: January 1 through December 31 Sources: Firm’s website and annual report, Hoover’s, WetFeet analysis

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The Firms

The nation’s largest bank is organized into three major business units—Corporate and Investment Banking, Global Consumer Group, and Global Wealth Management. It also has a standalone business unit, Citi Alternative Investments. The company’s range of services includes investment banking, commercial banking (mainly through subsidiary Citibank), asset management, financial planning, retail brokerage, and private banking for high-net-worth individuals. There’s always something happening at Citi and this past couple of years was no different. Chairman Sandy Weill retired and was replaced by Charles “Chuck” Prince in April 2006. Also that year, U.S. Consumer Businesses, part of the Global Consumer Group, was reorganized, the company expanded into the storebranded credit-card business (striking a deal to acquire the $4.4 billion portfolio of Federated Department Stores), and the firm broadened its global presence with 313 retail bank branches. It was a frenetic early 2007 as well. Citi closed a deal early in the year to purchase a 20 percent stake in

Turkish bank Akbank, giving it a foothold in Eurasia. The company also cracked a hard-boiled $1 billion deal to scoop up Egg, an online bank serving 3 million British customers formerly operated by Prudential. But wait, there’s more: Citi obtained hedge fund and private equity specialists Old Line Partners, purchased U.K.based asset manager Quilter from Morgan Stanley for an estimated $473 million, snapped up Japan’s Nikko Cordial for $9 billion, and announced a potential $9 billion deal to buy ABN AMRO’s mortgage group. Citi also plans to obtain outsourcing, back-office and thirdparty provider BISYS for around $1.5 billion. The flurry of acquisitions, especially of overseas firms, plays into Prince’s master plan to boost profits in foreign markets to 60 percent from the current level of not quite 50 percent. Despite this seemingly nonstop activity, not everything has been rosy for this financial services titan. Mixing the good and the bad, Citi has had its fair share of hardship. Its vast operations were hurt by the U.S. bear market, the collapse of technology companies, and the Argentine economic

the industry

Make no mistake, Citigroup is big. It has 3,000 branches and offices in the U.S. and Canada, and 2,000 in more than 100 other countries. It was the first bank with $1 trillion in assets and it aims to keep ’em coming.

The Firms

the industry

25 Top Financial Services Firms crisis. Citi’s investment banking group was charged with securities fraud as a result of its work for Enron and WorldCom (the bank ended up settling charges in the WorldCom case for $2.65 billion in 2004 and $2 billion in the Enron case in 2005). Also in 2004, the bank’s Japanese private banking operations were shut down by the Japanese government after improper securities sales. In 2007, Citi took a knife to its Japanese operations, shuttering 270 of its 320 branches there. Citi is still trying to rein in the aggressive culture long found at the company and at subsidiaries like the I-banking unit. It’s in the process of instituting firmwide compliance standards, setting up regular reviews of compliance by audit committee members of the bank’s board of directors, mandating ethics training for every employee, and pushing the bank’s ethics hotline on employees. After trying to become an all-things-to-allclients financial supermarket under former CEO Weill, the bank’s management is now focused on improving margins by trimming costs and growing core businesses while divesting noncore businesses. Along these lines, in 2005, Citi agreed to a swap of its asset-management and mutual fund business for Legg Mason’s retail brokerage unit (and some stock), adding 1,542 Legg Mason brokers to the 12,182 brokers Citi had at the time. It then sold Legg Mason’s capital markets business to Stifel Financial. Citi posted earnings 18 percent higher in the second quarter of 2007 than in the first, a good sign for CEO Prince’s so-called turnaround efforts. Still, Citi announced a cost-cutting plan in April.



Sells its red umbrella logo back to Traveler’s Insurance (consumers apparently always associated the umbrella with Traveler’s anyway).



In Thomson Financial’s equity and debt capital market league tables, for the second quarter of the year, ranks 1st in global debt, equity and equity related, in global mortgage-backed securities, in global asset-backed securities, in U.S. investment-grade corporate debt, in U.S. asset-backed securities, and in U.S. convertibles; 2nd in global convertibles; 4th in global IPOs; 6th in global common stock and in U.S. common stock; 8th in U.S. IPOs; and 10th in U.S. mortgagebacked securities.



In Thomson Financial’s syndicated loan league tables, for the second quarter of the year, ranks 2nd in global loans and in investment-grade loans; 3rd in U.S. loans and in U.S. leveraged loans.



In Thomson Financial’s M&A league tables, for the second quarter of this year, ranks 3rd in worldwide announced, in worldwide completed, in U.S. target announced and in U.S. target completed.



2006 Chuck Prince replaces Sandy Weill as chairman.

Recent Milestones



Agrees to purchase Standard Life (Mauritius Holdings)’s 9.3 percent equity stake in HDFC, India’s second largest mortgage lender.

2005

Enters into retail partner credit-card agreement with Federated Department Stores, acquiring $4.4 billion portfolio.

2007

Second-quarter profits hit an all-time high of $6.23 billion, up 18 percent from the second quarter of ’06.



Establishes beachhead in Japanese retail financial service market with $10 billion purchase of Nikko Cordial.

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Global Transaction Services, a business unit of Citigroup Corporate and Investment Banking, acquires Unisen, a fund services and transfer agency provider from AGF Management based in Ontario. Swaps its asset-management business for Legg Mason’s brokerage network; sells Legg Mason’s capital markets business to Stifel Financial.

2004

Sells off the Travelers Life & Annuity unit, as well as all international insurance businesses except for the Mexican unit.



Opens 203 international branches, bringing the number of Citi branches around the world to 3,253.

The Inside Scoop Strength in Numbers Aside from the overarching culture of Wall Street, there is no single Citi culture, according to insiders. Different departments act independently and very much at their own rhythm, in part because the company has gained so many separate businesses through acquisitions. Some insiders say they’re just glad to have so many resources at their disposal. One notes, “Whatever a client wants to do, there’s an expert at Citigroup that can help.” Others see things differently.

INSIDER SCOOP

Citi hires for each of its three major business units: Corporate and Investment Banking, Global Consumer Group, and Global Wealth Management; its standalone business unit, Citi Alternative Investments; as well as for “corporate center” positions (in areas such as controlling, operations and technology, internal audit, risk management, HR, and legal). Undergraduate and graduate students can get hired as entry-level management analysts and associates, respectively, in all five groups. Details on business units, job functions, degree requirements, and academic degree preferences are available on the company’s website. While some jobs require financerelated degrees, there are plenty of opportunities for which all disciplines are considered. Citi recruits at a wide range of undergraduate and MBA schools for many positions throughout the bank, and at top schools for investment banking, research, and sales and trading programs. Recruiters typically look for a wide variety of majors. Interviews are one-on-one or two-on-one. Undergraduates enter as analysts, and MBAs, other master’s degree holders, JDs, and PhDs can apply to the associate program. “We want enthusiastic people who genuinely convey that they want to work in the industry and work here rather than anywhere else,” an insider says. “We look for people who are hungry and who would go through walls to get something done.” Key U.S. offices are in WETFEET INSIDER GUIDE

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The Firms

“However old the conglomerate is, it still has some serious growing pains. When I was in the investment bank and I was supposed to be supporting someone else from another division, it was usually like pulling teeth to get that person to work with you. They see you as someone creating more work for them as opposed to being part of the Citi team moving forward.”

Getting Hired

the industry



I-Banking Ball Citi’s I-bankers participate in the industry’s legendary hard-driving culture, but employees say it isn’t internally competitive. “Everybody wants to win, and we’re all part of the same team,” an associate says. “We take our work but not ourselves seriously, unlike other bankers.” Another says, “We want to enjoy the people we’re working with at 4:00 in the morning—you see Nerf balls flying around in the late hours. Work here is fun to the extent that banking can be fun.” A former employee, however, derided Citi’s “jock” culture and surmises that “if you’re politically savvy, even if you’re not good at finance, you can excel.”

25 Top Financial Services Firms New York, Chicago, Dallas, Houston, Los Angeles, Menlo Park, Calif., and San Francisco. Insiders say that financial consultant positions at the bank have an extreme recruiting process, with a long series of one-on-one interviews. There’s no particular candidate profile—insiders say there’s a definite range of hires.

the industry

Undergraduates Citi’s Global Corporate and Investment Banking business usually hires undergrads into capital markets, sales and trading, public finance, quantitative trading and research, finance, operations, technology, global corporate finance, investment banking, and global transaction services. Training specifics and program length vary for each of these areas. In investment banking, undergraduates enter as analysts and are hired into a specific industry coverage or product group. The program lasts two years and commences in mid-July with five weeks of training in New York. Second-year analysts asked to stay on for a third year have the opportunity to work in another group or in an international location. One insider estimates that ten of 60 analysts are chosen for promotion each year, so it’s possible to become an associate without an MBA. Citi also hires undergrads in other areas throughout the bank; check www.citigroup.com/citigroup/ oncampus for more information on these many opportunities.

The Firms

MBAs Citi’s Global Corporate and Investment Bank hires MBAs and other grad students into capital markets, sales and trading, global corporate finance, investment banking, global transaction services, and equity research. Training and program length vary for each of these areas, as with the undergrad programs. Citi holds to a steady promotional timeline in the investment bank, insiders say. One adds, “The fast track is rare. It’s a standard two-year analyst [stint]. If you’re invited to stay for a third year, you become an associate after that. Then it’s three and a half years to vice president, 34

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then three years to director.” The bank also hires MBAs into other areas firmwide; check www.citigroup. com/citigroup/oncampus for more information.

Summer Associates In addition to the full-time positions, there’s a variety of internships throughout the bank; check www.citigroup.com/citigroup/oncampus for more information.

Midcareer Candidates Citi increasingly is hiring people who can offer specific industry expertise. Check out the online job postings at www.citigroup.com/citigroup/careers for opportunities across the organization.

Recruiting Contacts If you cannot participate in a recruiting event, apply online. Students should check out www.citigroup. com/citigroup/oncampus. For job postings, go to www.citigroup.com/citigroup/careers.

Credit Suisse 11 Madison Avenue New York, NY 10010 Phone: 212-325-2000 www.credit-suisse.com

Overview

INSIDER SCOOP “Be prepared to cancel trips to visit family, lose touch with your friends, give up your weekends, and basically give up two years of your life.”

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 67,532 68,393

-1.3

Worldwide earnings ($M) 9,294

109

Number of employees

4,447

44,871 63,523

-29.4

Figures for Zurich-based Credit Suisse Group Fiscal year: January 1 through December 31 Sources: Hoover’s, WetFeet analysis

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The Firms

The last few years have seen constant change. In 2001, John Mack—known as “Mack the Knife” while heading Morgan Stanley—came on board as CEO. The firm cut about 20 percent of its investment-

banking employees and cut back on employee compensation as well. Restructuring followed in 2004 and 2005. Still, the bank’s performance lagged behind competitors’. As a result (and because Mack clashed with his boss at Credit Suisse Group), Mack was cut and replaced by Oswald Grübel in 2004 (Mack is back atop Morgan Stanley these days). Despite the unsettling aspect of the last few years, Credit Suisse is an ideal place for jobseekers who want the breadth of opportunities offered by a large organization and the entrepreneurial excitement of a firm that continues to forge ahead. You’ll have more responsibility, client exposure, and international travel and living opportunities than your colleagues at most of the other banks on the Street. “The best part [about working at Credit Suisse] is that I get to be involved in the kind of issues that require a CEO’s or COO’s attention,” one young analyst says. “And I am directly interfacing with these types of people.”

the industry

It was years in the making, but give Credit Suisse some credit—it made things work. After nearly 24 months of wrangling, 2006 saw the birth of Credit Suisse Group following a merger between business units Credit Suisse and Credit Suisse First Boston. The new structure combines investment banking, private banking, and asset management under a single, global brand: Credit Suisse. Previously, Credit Suisse First Boston, known as CSFB, was the only Top 10 investment bank owned by a non-U.S. entity. In January 1997, CSFB was fully integrated into Switzerland’s Credit Suisse Group, culminating a relationship that began with a minority investment by Credit Suisse nearly 20 years before. The integration gave CSFB a new client base and line of products and services that has let it become a bulgebracket firm in the U.S. and a prominent fixture on the global financial scene. It has a long reputation for excellence—both in and out of the U.S.—in M&A, equity underwriting, sales and trading, I-banking, and investment research. In 2004, for instance, CSFB coled and -managed Google’s IPO, with Morgan Stanley.

25 Top Financial Services Firms

The Firms

the industry

Recent Milestones 2007

Brady Dougan succeeds CEO Oswald Grübel, who retired, as CEO of Credit Suisse USA.



Merges four Credit Suisse private banks with Credit Suisse Fiedes to create Clariden Leu, a Swiss private bank.



Reaches settlement with Enron Creditors Recovery Corp. in which it pays Enron $61.5 million in cash and denies any liability. In Thomson Financial’s equity and debt capital market league tables, for the second quarter of the year, ranks 4th in global mortgage-backed securities and in U.S. mortgage-backed securities; 6th in global convertibles; 7th in global common stock, in global IPOs, and in U.S. IPOs; 8th in U.S. convertibles and in U.S. common stock; and 9th in global debt, equity and equity-related.





In Thomson Financial’s syndicated loan league tables, for the second quarter of the year, ranks 6th in U.S. loans and in U.S. leveraged loans; 8th in global loans; and 10th in U.S. investment-grade loans.



In Thomson Financial’s M&A league tables, for the second quarter of this year, ranks 6th in worldwide completed and in U.S. target announced, 7th in U.S. target completed; and 8th in worldwide announced.

2006

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Sells insurance subsidiary Winterthur to insurance giant AXA for almost $10 billion.

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Completes merger of business units, Credit Suisse and Credit Suisse First Boston.

2005

Begins staffing up at its new Research Triangle Park office in North Carolina, with plans to hire some 400 entry-level and experienced IT and securitiesoperations employees through 2006.

2004

Dumps CSFB CEO John Mack in favor of Brady W. Dougan.



Credit Suisse Group announces plan to create “a fully integrated bank, combining the current business units Credit Suisse and Credit Suisse First Boston, in a process that is expected to take between 18 months and two years.”

The Inside Scoop Your Cup Runneth Over At Credit Suisse you won’t get the kind of structure or methodology that you’d expect to see at Morgan Stanley or Goldman Sachs, where roles and responsibilities are clearly defined and set. Juniors say the amount of responsibility they are given is staggering and heady. “I don’t think I could have gotten the amount or level of responsibility anywhere else coming out of school,” says one analyst. New employees must learn how to be all things to all people. “You pretty much become a ton of things to your client,” an insider says.

INSIDER SCOOP “We don’t have a lot of really difficult individuals to work with here. Obviously, the work is very demanding, but there’s no yelling or hazing going on.”

Your So-Called Life

INSIDER SCOOP “In my first five or six months I was working 90 hours a week consistently. But after I got to understand the system and made friends in different departments it cut things down. I was out at a smooth 60 to 70 hours.” Similarly, another associate told us that she only works 60 to 70 hours a week—though she says: “We entertain clients at night. Does that count as work?” Although the analyst lifestyle is by far the worst, associates and even VPs may find themselves losing the battle between work and play.

Getting Hired

Undergraduates Credit Suisse’s “Where Do You Fit In?” function on its website lists a number of possibilities: equity research, fixed income research, investment banking, asset finance capital markets, alternative investments, global markets solutions group, sales trading equity sales, fixed income sales, private banking, equity trading, emerging markets, leveraged finance, information technology, shared services and HOLT—a database of more than 18,000 companies that analyzes corporate performance and stock pricing.

INSIDER SCOOP “Landing a job here really is personality driven. Show them you’re a team player and you’re willing to work the hours—you really don’t get into investment banking and complain about the hours. You need to have an easygoing attitude and be easy to get along with.…I’m not the stereotypical candidate for banking: My GPA was only around a 3.1. But I had a great resume and summer internship experience. There are many ways to get into the bank.” Undergrads often are hired on as analysts in fixed income sales, trading, research, debt capital markets, and asset finance and securitization; equities sales, trading, research, and equity derivatives and convertibles; investment banking; information WETFEET INSIDER GUIDE

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The Firms

Credit Suisse hires MBAs and undergrads for entrylevel positions in the fall and experienced hires on an as-needed basis throughout the year. The campus recruiting parade begins in early fall when Credit Suisse begins making presentations at selected undergraduate and MBA schools nationwide. Recruiters say that having a 3.5 GPA is used as a benchmark, but that other factors, such as extracurricular activities that demonstrate leadership

and teamwork abilities, also are key. The recruiting process consists of on-campus interviews followed by an onsite visit at the New York headquarters. “We’re looking for people who are smart, diligent, team players,” a recruiter says. “We want to see evidence that you can be a strong leader, are comfortable in a high-risk, high-pressure, competitive environment.” Candidates from all majors are encouraged to apply— so long as you’re good with numbers. The recruiter continues, “We hire a fair number of people with liberal arts backgrounds, because we believe we can train them here. For all candidates, however, you’ve got to demonstrate strong quantitative skills.”

the industry

Hours in investment banking at Credit Suisse are some of the most grueling on Wall Street, especially at the analyst level. Analysts may work 90 hours a week on average with 60 on the low end and 110 on the high end (as a point of reference, Christopher Wren, an associate, says his hours “aren’t especially long. Most of the desk is here between 6:00 a.m. and 7:00 a.m. and we leave around 6:00 p.m. or 7:00 p.m.”) As for the lifestyle, “You get killed,” says an insider. “Be prepared to cancel trips to visit family, lose touch with your friends, give up your weekends, [and] basically give up two years of your life [when you’re an analyst].” Another analyst says, “It’s a trade-off. I know I’ve got to put in my two years—pay my dues to get ahead.” One former analyst readily acknowledged that the hours are insane, but noted that as one learns the ropes he or she can get more done faster.

the industry

25 Top Financial Services Firms technology; finance, administration, and operations; and alternative capital (hedge funds, private equity, and fundraising for fund managers). Analysts hired into equity research receive their own universe of stocks to cover independently. In the U.S., investment-banking analysts start with a seven-week training program in New York, while fixed-income and equities sales and trading and research analysts start with an 11-week training program, also in New York. In general, these programs include introductions to Credit Suisse’s products and services, presentations by senior management, seminars with external experts (NYU and Columbia Business School professors as well as individuals from leading training consulting companies), and preparation for the Series 7 and other regulatory exams. I-banking and sales and trading analysts sign on for two years, with a third-year offer based on performance. After the first two years, many analysts leave to attend MBA programs, but some analysts stay beyond the three-year program without attending B-school, moving up through junior and senior analyst levels. The firm customarily offers summer analyst positions in investment banking, equities, fixed income, IT, and finance, administration, and operations.

The Firms

MBAs MBAs are hired as associates in most of the same areas as undergrads: fixed-income sales, trading, research, debt capital markets, and asset finance and securitization; equities sales, trading, research, and equity derivatives and convertibles; investment banking; and alternative capital. MBAs are expected to take on and work with five to seven companies within their first year. Some new associates take part in Credit Suisse’s HOLT University program, a six-month rotational training program based primarily in Chicago but with possible stints in New York, London, Hong Kong, and Tokyo; at the conclusion of the program, these associates may move into a number of areas within the bank, such as research, banking, or sales. 38

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Associates spend three and one-half to four years in a group before being considered for promotion to vice president. The levels after VP are director and managing director; an MD at Credit Suisse is equivalent to a partner at a firm like Goldman. There’s no partnership structure constraining advancement, so if you can distinguish yourself early on, the sky’s the limit. Credit Suisse has formal summer associate programs in I-banking, sales and trading (S&T), and research. You won’t find anyone in the candidate pool who is not from a top B-school. The Credit Suisse S&T summer program is one of the few on the Street that’s rotational.

Midcareer Candidates Hiring at this level occurs on an as-needed basis. If you’re a midcareer professional who wants to get hired at Credit Suisse, get in touch with any contacts you have at the firm and on the Street, spread the word through professional organizations you belong to, and don’t hesitate to get in touch with headhunters.

Recruiting Contacts For an extensive list of recruiting contacts for positions listed by job category, employment level, and location, see the Credit Suisse website, www.credit-suisse. com/standout.

Deutsche Bank Securities 60 Wall Street New York, NY 10005 Phone: 212-250-2500 Ticker: DB http://www.db.com/index_e.htm

Overview across India, and has expressed interest in buying the German government-owned Berliner Bank. But along with global growth, Deutsche Bank has experienced setbacks, including the resignation of chairman Rolf Breuer two years before his contract expires. In June, the company proposed to shareholders that CFO Clemens Börsig replace Breuer. In addition, in April 2006, the company received a black eye—the third-largest penalty ever imposed by Britain’s Financial Services Authority. The company was fined £6.4 million ($11.2 million) for market misconduct. Finally, it cut approximately €250 million ($300 million) from its 2005 net profit as it increased its provisions for pending tax shelter lawsuits in the U.S.

the industry

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 101,183 72,659

39.3

Worldwide earnings ($M) 7,903

89.1

Number of employees

4,180

68,849 63,427

8.5

Note: Figures are for parent company, Deutsche Bank AG, which does not release financial data specific to Deutsche Bank Securities Fiscal year: January 1 through December 31 Sources: Hoover’s, WetFeet analysis

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The Firms

Long das größte (“the biggest”) bank in Germany, Deutsche Bank is setting its sights on making a splash in the American market. Following the trend of European-backed banks such as Credit Suisse and UBS, in the 1990s Deutsche Bank made several acquisitions, rapidly building a global platform. In 1999, as part of its purchase of Bankers Trust, Deutsche Bank acquired Alex. Brown, the San Francisco boutique technology investment house, to expand its investment-banking unit. The integration of Deutsche Bank and Alex. Brown went more smoothly than other industry mergers (such as that of Bank of America and Montgomery Securities) possibly because Alex. Brown was essentially swallowed whole by the big German finance house. Today DB Securities offers clients investment banking, sales and trading, brokerage, financial advisory, and investment products. In 2005, parent company Deutsche Bank AG took significant steps to cut costs, including stock buybacks, the sale of peripheral operations, and layoffs, particularly in the technology sector. As a result, it saw its net revenue grow by 17 percent. Although layoffs have been part of Deutsche Bank life for the past few years, hiring has been steady at the firm, especially for entry-level positions. Globally, Deutsche Bank made several key moves in 2006. It acquired minority stakes in both China’s Hua Xia Bank and Mexican mortgage originator Fincasa Hipotecaria, opened eight branches in five cities

25 Top Financial Services Firms Recent Milestones Aiming to augment its U.S. lending operations, purchases MortgageIT for $430 million.



In Thomson Financial’s equity and debt capital market league tables, for the second quarter of the year, ranks 3rd in global debt, equity and equity related, in U.S. convertibles and in global convertibles; 6th in global asset-backed securities and in U.S. asset-backed securities; 8th in global mortgage-backed securities, in global IPOs and in global common stock; 9th in U.S. investment-grade corporate debt and in U.S. IPOs and 10th in U.S. common stock.

the industry

2007



In Thomson Financial’s syndicated loan league tables, for the second quarter of the year, ranks 4th in global loans and in U.S. leveraged loans; 5th in U.S. loans; and 7th in investment-grade loans.



In Thomson Financial’s M&A league tables, for the second quarter of this year, ranks 8th in U.S. target announced and in U.S. target completed; and 9th in worldwide announced and in worldwide completed. Announces plans to acquire Chapel Funding, a California-based mortgage originator.

The Firms

2006



Acquires minority stakes in both China’s Hua Xia Bank and Mexican mortgage originator Fincasa Hipotecaria.



Opens eight branches in five cities across India.

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David Lane returns as a director and head of equity financial resource management for Deutsche Bank Securities.

2005

Targacept, a North Carolina–based drug discovery company whose IPO was to have been lead-managed by Deutsche Bank Securities, delays the IPO due to “market conditions.”

2004

Agrees to pay $87.5 million to settle SEC charges of conflicts of interest between its banking and research functions.



CEO Josef Ackermann is acquitted of charges that he breached shareholder trust when Vodafone took over Mannesmann, where he was a board member.

The Inside Scoop

Branch Office Blues

Breathing Room

Deutsche Bank insiders report on the bureaucracy associated with working for a huge investment bank like Deutsche, but they also say that sometimes they feel out of the loop by being in a branch office. “It’s harder to create opportunities and progress than at a smaller firm,” one says. “There’s definitely hierarchy and infrastructure. It’s hard to get airtime when the key decision makers are in New York, and I’m on the West Coast.”

A former BofA Securities employee now at Deutsche Bank says he prefers his new company’s corporate culture, which is more easygoing than at BofA. “I left because I was in a rut,” he says. “At Deutsche, the culture is more laid-back and low-key, with a younger staff. There is a healthy balance between internal competition and camaraderie.” Another employee, who also jumped from another financial services firm, says, “There are definitely fewer old, stuffy bankers here.” “It’s a very sexy business. Since I’ve been here we’ve handled the largest buyouts that have ever been done.”

What’s in a Name? Parent company Deutsche Bank may be well known in other countries, but U.S. consumers are less familiar with it. As a result, Deutsche Bank Securities faces a tough road in establishing a strong domestic brand. An insider says, “Although Deutsche is one of the world’s largest financial institutions, it doesn’t have as big of a presence in America.” Many of its employees are working to change that, though.

INSIDER SCOOP “Every day you’re taking a new hill. Every victory is celebrated, every accomplishment is heralded. We’re not under assault, but we’re changing the existing order. It adds a lot of excitement. The other side is that it’s never easy. You earn every stripe. Every hill you’ve got to climb from the very bottom. But if it’s that versus defending the hill, I’d rather be the guy who’s trying to scale.”

But is it a Nice Water Cooler?

INSIDER SCOOP “You have to do your own due diligence. They don’t have a big presence on campus compared to the competition. They don’t have the cocktail parties. DB is very well known in Europe. The training has tremendous cache on the continent, but not in the U.S. yet.”

Undergraduates and MBAs Deutsche Bank Securities hires undergraduates as analysts in global banking, global markets, and private wealth management, and in corporate functions, such as technology, operations, controlling and finance, risk management, and human resources. Undergraduates apply for analyst positions from September 1 to November 1. MBAs, who come on as associates in global banking, global markets, and asset management, apply during the same period. MBA applicants should have three to five years of work experience. New associates receive a minimum of six weeks of training when they come on board. WETFEET INSIDER GUIDE

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The Firms

Employees note that perks aren’t what they used to be at the firm. “We used to have free lunch and drinks,” one says. “Now we have a water cooler.”

Entry-level hiring at Deutsche Bank has been steady in recent years. Many new Deutsche Bank hires come from nationwide recruiting at undergraduate and business schools. Recruiters look for a strong academic background and a facility with numbers (and virtually everyone at Deutsche doubles as a recruiter). Although candidates don’t need a financial background, business knowledge is expected, as is a clear set of goals. Interviewers want candidates who know which area of Deutsche Bank they want to work in and why.

the industry

INSIDER SCOOP

Getting Hired

the industry

25 Top Financial Services Firms Deutsche Bank offers summer internships for both undergraduate and graduate students in its corporate and investment banking divisions. The majority of the positions are based in New York, with some slots in other regional offices. There are also opportunities in regions such as the U.K. and Asia Pacific. For 2008, DB plans to bring on board about 1,000 new trainees into its three regions: London, the U.S., and Asia Pacific. “We want a mobile resource strategy,” says a recruiter. “Sometimes the best person to head a team is not a domestic hire. We want to mobilize our best people anywhere.” While undergraduate hiring is done domestically in regions where DB has a presence, the U.S. is its primary source for MBA recruiting. All candidates, including campus recruiting candidates, must complete the online application on Deutsche Bank’s website.

Midcareer Candidates Experienced hires can apply for jobs listed on the company website.

Recruiting Contacts If you cannot participate in a recruiting event, apply online at career.deutsche-bank.com.

Additional Resource

The Firms

For more about the firm, check out the WetFeet Insider Guide to Deutsche Bank, available from www. wetfeet.com.

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FMR 82 Devonshire Street Boston, MA 02109 Phone: 617-563-7000 www.fidelity.com

Overview FMR’s private structure means that Fidelity can do things like spend $700 million on upgrading its online brokerage in 2004 without worrying about how that expense will hurt the bottom line in its next quarterly earnings report. And while Fidelity escaped untainted from the fund-trading scandals, a SEC probe in late 2006 resulted in a $9.7 million fine of stock brokerage firm Jeffries & Co. after its employees showered Fidelity traders with more than $1.6 million in luxury goods, trips and sports tickets. Fidelity claims to have disciplined 14 employees over the matter, firing several of them.

the industry

Key Numbers As a privately held company, FMR does not release financial information. Hoover’s estimates a headcount of 37,000 and estimated 2007 sales of $2.15 billion. The Boston Globe reports a higher headcount of 43,000.

Recent Milestones 2007

A rash of top-level executive resignations leads to the return of Rodger A. Lawson as president after a 16-year absence from the company.



Slashes its stake in PetroChina by 91 percent in response to requests from human-rights groups to divest itself of companies linked to Sudan.

2006

Acquires 15 percent stake in Lazard, a British investment bank.



Restructures sector mutual fund product line. WETFEET INSIDER GUIDE 43

The Firms

You could say FMR is a family business—a $1.3 trillion family business. Since Edward Johnson took over the firm in 1943, FMR has grown to be one of the world’s biggest and best-known mutual fund companies, as well as one of the largest money managers in the U.S. While steadily adding to its family of funds (there are currently around 395), Fidelity Investments, as the firm is better known, continues to branch out. It has been pursuing multiple marketing channels and strategic alliances with other investment institutions, as well as launching an HR benefits and pension administration business (which, according to Fidelity, has been the fastest-growing area of the firm). Once best known for its flagship Magellan Fund, managed by the world’s first famous fund manager, Peter Lynch, Fidelity has since spread out to institutional sales, retail brokerage, IRAs, 401(k)s, life insurance, investment advisory, stock clearing, real estate, and even start–up financing. To better compete with low-fee funds company Vanguard, like other big fund companies, Fidelity—or Fido, as it’s sometimes called in the industry—has been slashing commissions on trades of its index funds and some other investments in a bid to win more customers. The company is privately held, with the founding Johnson family owning about half. Edward Johnson’s son, Ned, still serves as chairman and Ned’s daughter (and potential successor), Abigail Johnson, is the firm’s largest shareholder. She recently switched positions from president of the mutual fund division to president of the retirement division, Fidelity Employee Services. The company won’t say whether Abigail is her father’s heir-apparent.

25 Top Financial Services Firms 2005

Reports that it added more than 21,000 new financial advisers to its network of advisors distributing Fidelity Adviser Funds in 2004.





Takes on HR and benefits-outsourcing work for clients including BASF.



Launches new technology platform for independent advisors in the Fidelity financial advisery network, which brings together such features as contact management, financial planning, trade-order management, and portfolio management and reporting.

2004

Takes on HR and benefits-outsourcing work for clients including the Bank of America, Inova Health, TRW Automotive, and University of California.



Permanently eliminates commissions on index fund trades.



Has 9.9 million customers at the end of the year, 40 percent more than Charles Schwab and 10 percent more than Merrill Lynch.



Spends $700 million on technology for its brokerage arm.

The Firms

the industry

Reassigns Abigail Johnson—the daughter of (and potential heir apparent to) Ned Johnson, FMR’s chairman of the board and CEO—from president of Fidelity Management and Research to president of Fidelity Employer Services.

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The Inside Scoop Different Strokes With so many businesses and locations, the hours, dress code, and culture vary from group to group, but autonomy and competition are central themes at Fidelity: Each business unit develops its own business plans, strategy, and execution.

Fight Club? CEO Johnson encourages a healthy level of competition between business units and even has to step in at times when the intensity flares up. Some former Fidelity employees complain about the level of internal competition. Division-level executives have departed over the last several years because of a zerosum mentality when it comes to promotions: Some managers must lose for others to get ahead.

No Hard Feelings Fidelity bears no grudge toward employees who leave the company and sometimes actively seeks to rehire them through its alumni network (Rodger Lawson’s return is a good example). The network keeps Fidelity’s memory fresh by providing alumni with up-to-date company news and current job postings.

INSIDER SCOOP

in at least 20 countries, including major hubs in London, Tokyo, and Hong Kong. It asks all job applicants to complete its online application, at www. fidelity.com/jobs.

Getting Hired

Undergraduates and MBAs

Beyond fund management and investment research, the firm employs people in a wide range of functions, including operations, finance, accounting, brokerage, legal, human resources, IT, customer service, marketing, and sales. The company continues to recruit undergraduates and graduates on campuses nationwide. Positions for midcareer candidates are filled as needed. Fidelity has hired about 15 percent of new employees from undergraduate and graduate recruiting efforts. With no strict hiring criteria and a variety of opportunities, recruiters tell job candidates to come prepared to “sell” themselves. “Instead of just listing your strengths, describe what you have accomplished as a result of those strengths. Cite specific examples,” one recruiter says. Fidelity does not release specific hiring numbers, but its Canadian arm does note that it receives “well over 2,000 resumes each year.” The company interviews fewer than 20 percent of applicants, only 20 percent of these interviewees move to later rounds, and 15 percent of those having multiple interviews are hired. Doing the math, if exactly 2,000 job seekers sent in resumes, roughly 400 would be interviewed, with 80 of them moving to the next round, and only 12 of them being hired. Because the company has a policy of hiring fund managers from within, it views the selection of analysts as critical to the success of the company. Early on, company interviewers plumb applicants’ personal interests to find a fit (a person with a bent for baseball statistics, for example, might transfer that interest into evaluating companies). Once in action, analysts have a lot of flexibility in how they choose to pick stocks; the firm believes there’s no one perfect investment style. The company is headquartered in Boston with 14 regional offices and more than 100 investor centers

Fidelity has more than 40 business units, but generally they are grouped as brokerage, institutional, intermediary services, technology and processing, e-business, fund management, capital companies, corporate finance, and corporate services. MBAs are generally hired into positions as finance project managers, quantitative equity analysts, and product/ service consultants. Fidelity believes in promoting from within and accommodating internal career moves. Employees can use internal websites to store resumes, apply for internal job postings, and track their career progression. To encourage the development of its employees, Fidelity also conducts internal training programs and offers tuition reimbursement. Undergraduates and first-year graduate students can apply for paid, full-time internships starting in February. Strong work experience and a GPA of 3.0 or higher are required. There may be some fall and spring internships with flexible hours. For longer terms, fourto six-month co-ops can be arranged year-round—also paid, full-time—usually for school credit.

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“It’s virtually impossible to get hired at Fidelity unless you know someone there who can get your resume to the right person.”

Midcareer Candidates Fidelity employees pride themselves on the fact that their colleagues are among the best and brightest. Experienced hires may apply for open positions online at the company website.

Recruiting Contacts

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For more information regarding opportunities at Fidelity and to view the company’s current job listings, go to www.fidelity.com/jobs.

25 Top Financial Services Firms

Goldman Sachs 85 Broad Street New York, NY 10004 Phone: 212-902-1000 Ticker: GS www.gs.com

the industry

Overview When you play for Goldman Sachs, you play for the varsity. The firm’s operating philosophy is that it’s the best there is—and it’s often hard to argue with that. Likely the most prestigious American name in investment banking, the firm is known for its cultlike corporate culture and secretive operations. This winning combination translates into results: Goldman Sachs is consistently profitable, and consistently at or near the top of the I-banking league tables. Particular industry strengths are in telecommunications, financial services, energy, technology, and health care. The firm is rapidly globalizing in Europe, Israel, Japan, and Latin America, and is broadening its platform through a dramatic expansion in asset management and securities services.

INSIDER SCOOP

The Firms

“Goldman will push you every bit as hard as, if not harder than, its rivals.” Despite its reputation for secrecy, the firm has been publicly lauded for its workplace. Goldman perennially ranks as one of the most desired places to work by MBAs and is foremost among financial services firms. Once in the door, people love the firm; Goldman made Fortune’s “100 Best Companies to Work For” in 2007, its tenth straight year on the list, in no small part due to its high percentage of minority and female staff and its generous outreach to ensure employee well-being. (The monster salaries don’t hurt, either.) However, without the carrot of an ownership stake in the firm—which existed before the bank went public in 1999—Goldman 46

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employees today are much more likely to leave the firm for other offers than they were before. Goldman used to think of itself as “long-term greedy,” as a partner once called the firm, in that it would gladly pass on short-term profits to cement client relationships that would lead to substantial future income. Indeed, when the bank went public, it said it planned to stabilize earnings by focusing on fee-generating businesses, such as investment banking and asset management. However, the main driver of the firm’s growth in recent times has been trading, in particular proprietary trading (in other words, trading for the firm’s own account). Since the firm went public, giving it a mountain of new money to invest, the firm’s trading revenue has quadrupled to $25 billion. It jumped 50 percent in 2006. Also in that year (the latest on record) Goldman’s revenue jumped nearly 60 percent to almost $70 billion and its earnings jumped 70 percent to more than $9.5 billion.

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 69,353 43,391

59.8

Worldwide earnings ($M) 9,537

69.5

Number of employees

5,626

26,467 31,000

-14.6

Fiscal year: December 1 through November 30 Sources: Firm’s website and annual report, SEC filings, Hoover’s, WetFeet analysis

Jersey City tower is only 60 percent full and could hold 3,000 additional workers. In the first half of 2007, revenue from international operations tops U.S. revenue for the first time in Goldman Sachs’ history.



In Thomson Financial’s equity and debt capital market league tables, for the second quarter of the year, ranks 1st in global common stock and in U.S. common stock; 3rd in global IPOs; 4th in U.S. IPOs; 6th in U.S. investmentgrade corporate debt; 7th in global convertibles; 8th in global debt, equity and equity related; and 9th in U.S. convertibles.



In Thomson Financial’s syndicated loan league tables, for the second quarter of the year, ranks 5th in U.S. leveraged loans; 7th in U.S. loans; and 9th in global loans.



In Thomson Financial’s M&A league tables, for the second quarter of this year, ranks 1st in worldwide announced and in U.S. target announced; and 2nd in worldwide completed and in U.S. completed.

2006

President Bush’s nominee CEO Henry Paulson Jr. is confirmed as Treasury Secretary. Lloyd Blankfein succeeds as chairman and CEO, and Gary Cohn and Jon Winkelried are promoted to presidents and co-COOs.

2005

Breaks ground on its new headquarters, a 43-story green building in lower Manhattan, scheduled to open in 2010.

2004

President and COO John Thain leaves to run NYSE.

Recent Milestones 2007



In testimony before the U.S. House Budget Committee, vice chair of Goldman Sachs International Robert Hormats bemoans the nation’s dependence on foreign capital—to the tune of $1 trillion of debt a year—as a “historic break from over two centuries of American policy.” Receives permission to build a second office tower on Jersey City, N.J., waterfront, a 30-story, $560 million structure. The new tower could hold about 3,500 workers—though the firm’s current

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In 2006, Goldman CEO Henry Paulson Jr. became U.S. Secretary of the Treasury—the second Goldman leader to serve in the position (Robert Rubin was Treasury Secretary during the Clinton administration). With Paulson shifting from printing money at Goldman to signing it as Treasury Secretary, the firm’s board quickly appointed Lloyd Blankfein, formerly the president and COO, to replace Paulson. Although it doesn’t divulge details of its recruiting forecast, Goldman has been growing in recent times. A joint press release from the New York City mayor’s office and Goldman in 2005 announced the groundbreaking of Goldman’s future headquarters—a $1.8 billion, 43-story green building scheduled to open in 2010—along with Goldman’s intent to add 4,000 new jobs by 2019. The firm tends to focus its on-campus recruiting efforts on Top 10 graduate and undergraduate schools. The firm also recruits at Howard University and Spelman College, and it hires from other sources. “If you want to be with the best in the business, your resume is golden, and you don’t mind marching in step with like-minded colleagues, Goldman Sachs could be just right for you,” says an insider. Another points to the limitless opportunities after getting Goldman on your resume: “Once you’re a second-year analyst, you’ll receive lots of offers from hedge funds and other places.”

the industry

25 Top Financial Services Firms The Inside Scoop

Teamwork Above All

Putting the Cult in Culture

Goldman is famous for taking teamwork so seriously that it frowns on people using the first-person singular in discussing workplace efforts and accomplishments, preferring that all employees use “we.” Yet a recent summer intern says that competition does exist among individuals. “Although I worked with different groups, I can’t say I sat with different teams—groups of people working together to accomplish a specific goal or objective,” he says.

Since going public in 1999, Goldman’s single most critical task has been to maintain its culture, which it finds is intrinsic to the company’s success. “True Goldmanites have little to complain about. Once you’re part of the collective, you’re happy, and success breeds success,” says an insider. To be eligible for the Goldmanite club, you have to be at the top of your game. “Goldman can be a very inclusive environment once you have proven yourself and networked, but until you have, it can be somewhat insidious,” says another insider.

Under the Radar If Goldman were a Hollywood leading man, it would be the strong, silent type—think Harrison Ford. The firm rigorously guards its reputation for strict ethical standards and strives to keep a low profile. “It really doesn’t have anything to hide, but at the same time it doesn’t like talking to the press,” an insider says. Even though it’s the most prestigious American investment bank, its employees stress the firm’s modesty. “Ever notice that Goldman doesn’t advertise? No TV commercials, no billboards. You won’t find the Goldman Sachs logo on the outside of any of its offices,” an insider points out.

The Firms

Gold Standard Insiders repeatedly cite Goldman’s obsession with quality and devotion to the firm’s image, but claim that the firm still offers entrepreneurial freedom. “It’s the best of both worlds,” says one insider. Says another, “There are many opportunities to get hands-on practical learning on all types of transactions—and to teach others about the work.” Just don’t expect a free ride. “When you start, there aren’t a lot of tangible metrics by which you can be evaluated, so they rely on their perception of your work ethic,” says yet another insider.

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Green Gold Goldman’s Manhattan home-to-be is invariably described as a “green” building and it’s no coincidence. “People here really do care about various moral issues,” said one insider. “We were going to buy a power [company] and they were going to put up some new coal plants and we said we’re interested in this business but we would not participate in the purchase if they built the coal plants. They decided to not build the coal plants.” That employee also noted she was being driven home in a hybrid company car (albeit at 1 a.m. on a Monday).

Getting Hired Although Goldman isn’t the type to openly boast to the press, some insiders report a pervasive sense of superiority at the bank. (From the Goldman website: “At Goldman Sachs our culture is very much in evidence helping us attract and retain the best employees and clients.”) This is reflected in its recruiting practices. Your academic background is critical, but more to the point, Goldman wants smart and aggressive candidates who are mature and polished. One insider says that “not having the right pedigree” can hurt you at the firm. “People here are very bright, but unfortunately they can also be quite arrogant, though it’s very subtle and no one would admit it underlies the organization. Goldman is trying to do more to diversify its workforce through senior management, but you get a sense that it hasn’t trickled down to the rest of the organization yet,” he says.

Undergraduates and MBAs

Midcareer Candidates You can apply for positions online, but finding openings through networking is a much better option.

Recruiting Contacts Apply online at www.gs.com.

Additional Resource For more about the firm, check out the WetFeet Insider Guide to Goldman Sachs Group, available from www.wetfeet.com.

The Firms

Undergraduates can apply for analyst positions concentrated in the equities, fixed-income, investment banking, and research division. Analysts usually work two to three years, at which point exceptional performers move directly into an associate position and the rest go to business school—Goldman reportedly does not provide tuition support—or another career. All analysts are supposed to plan their career development with their managers, and the

review process requires you to choose 10 to 15 people to review your performance. MBAs are recruited for career positions in every division, but most join investment banking, fixed income, or equity. The competition is the fiercest anywhere on the Street; expect to find yourself up against not only former Goldman analysts looking to return to the company, but also those from other firms hoping to trade up after business school. Associates often work four years until becoming vice president and six or more years before becoming candidates for managing director—though prodigies can vault through the ranks at an accelerated pace. Summer internships and co-ops spanning all divisions are available for undergraduates and graduates. A word of warning: An internship doesn’t guarantee you a job. Goldman won’t divulge specific numbers, but of the many called, very few are chosen. Applications are due in January, and interviews take place in January and February. Even if you interview with Goldman on campus, you’ll have to complete its online application form.

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Fitting in is especially important at Goldman—the firm does an impressive job of recruiting people who subscribe willingly to the Goldman way. Insiders say that the firm likes to hire people with poise who have cultivated interests in art, history, and philosophy, in addition to current events. Without the right whiteshoe fit, some insiders say you might suffer from some nasty verbal hazing and the learn-by-fire environment. “People seem to be a little bit smarter and snappier here,” says an insider. Another insider urges new hires to assert themselves, saying, “You have to fight the constant put-downs and show them you’re not going to take it.” Training, unsurprisingly, is intense and compared to “a brainwashing period,” but offers a fantastic opportunity to network internally at social events before being dropped into the behemoth bureaucracy. Goldman recruits undergraduates and MBAs at top schools nationwide with intensive on–campus and onsite interviews in the fall; insiders report traveling to New York three or five times for follow-up interviews. The average candidate interviews with 10 to 20 people before getting a job offer and any person you interview with can disqualify you from the process (one recent hire told us she was interviewed for 30 to 40 hours—including 12 hours in one day—before getting an offer). The first interview, on campus, is a “firmwide” interview, designed to scout your general suitability for working at Goldman. If you make it past the first round, you might be invited to second-round interviews with up to two different divisions within the firm.

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25 Top Financial Services Firms

Jones Financial 12555 Manchester Road Des Peres, MO 63131 Phone: 314-515-2000 www.edwardjones.com

The Firms

the industry

Overview Desk? Check. Computer? Check. Hat rack? Check. Full-time assistant? Check. Edward Jones? Check. Time to go to work. If you’re a broker who likes to run your own shop, but you want the resources and support of a big company behind you, Edward Jones—and its holding company, Jones Financial—may be your kind of place. The company’s network of nearly 9,000 singlebroker branches is like no other financial firm in terms of the autonomy it affords individual brokers. If you’re a Jones broker, you call the shots. You choose where you want to open your office, and the company pays the rent, utilities, technology, marketing costs, and even your assistant’s salary. Although you can’t own your own office (as in a franchise), if you become a partner, you can own an interest in the entire broker network, which in years past has meant some generous profit sharing. The company has a strong commitment to training—on which it often spends between 2.5 percent and 4 percent of its payroll— which translates into an average of 103 hours of training per employee annually. Training for new brokers is about four times that. In 2006, Edward Jones was ranked as a top company for training associates by Training Magazine. With roots in the Midwest stretching back to 1871, the firm is known for its conservative approach to investing—it frowns on risky investments and margin trading—and for its stock research. But its squeaky-clean reputation was sullied in late 2004 when regulators accused Jones brokers of guiding their customers to fund companies that, unbeknownst to the customer, were also paying the brokerage through 50

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an innocuous-sounding arrangement called “revenue sharing.” As a result, the company paid a hefty $75 million fine that was distributed to its customers. Managing partner Douglas Hill also stepped down as a result.

INSIDER SCOOP “Nobody is looking over your shoulder telling you what to do. They never do that. It’s entirely up to you.” Note, undergrads: Jones is one of the few fullservice brokerages that accepts greenhorns fresh out of college for its broker-training program. This, of course, encourages promotion from within. New brokers have defined goals they must execute. They must make 25 real contacts a day and contact prospects at least once every two weeks before reaping the benefits of their own office with the name of Edward Jones (and the broker’s) on the door. That process (which involves about 1,000 cold calls)

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 3,461

3,200

8.2

Worldwide earnings ($M) N/A

N/A

N/A

Number of Employees

34,300 30,000

5.9

Fiscal year: January 1 through December 31 Note: Worldwide earnings not available Sources: Firm’s annual report, Hoover’s, WetFeet analysis



Becomes the first employer in St. Louis to offer uninsured part-time employees and early retirees a lower-cost insurance coverage option (through a coalition of companies addressing the problem of uninsured workers).

2004

Agrees to pay $75 million to settle Justice Department charges that the firm improperly disclosed revenue-sharing payments. Douglas Hill, managing general partner, agrees to step down from his leadership post at the end of 2005 and to pay $3 million of the firm’s $75 million settlement.

Recent Milestones



Makes Fortune’s list of the “100 Best Companies to Work For” for the sixth straight year.

2007

Makes Fortune’s list of the “100 Best Companies to Work For” for the eighth time.



Included in Computerworld’s “Best Places to Work in IT” rankings.

2006

Sells subsidiary Boone National Savings and Loan Association to Commerce Bank.



Ranks as a top company for training its associates in Training Magazine’s 2006 Top 100 edition.

2005

Withdraws from a business coalition supporting George W. Bush’s proposals to privatize part of Social Security after the AFL-CIO protests the firm’s involvement.



The Inside Scoop For the Long Haul Jones is “client-focused, entrepreneurial, and collaborative,” one recruiter says. “You may work for yourself, but you don’t work by yourself.” Brokers take the long view when it comes to serving their clients. “We’re about the long-term investor, not the quick buck,” a broker says. Brokers have a similar perspective on their relationship to the company. “Your career here is a long-term investment because we are a partnership,” a broker says.

Private Company As a private company, Jones is unusual among financial firms. Insiders say that rather than having to please Wall Street, the company can focus on pleasing its customers. “As a partnership, we don’t have to report earnings to shareholders, which allows our management team to focus on what’s right for the client,” one insider says.

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The Firms

Ranks “Highest in Investor Satisfaction With Full Service Brokerage Firms” in the J.D. Power and Associates 2005 “Full Service Investor Satisfaction Study.”

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usually takes 8 to 11 months from the time they are hired, which (naturally) includes a two-month training period. The firm is proud of never having laid off workers, and it continues to hire newcomers at a good clip, with special outreach underway to women and minorities in addition to undergraduates. Meanwhile, it has made an extra effort to keep those on staff as happy as possible during the tough economic times. In 2001, for example, bonuses came a week early. “We’re privately held, so we’re not at the whim of shareholders,” a broker says. “If you’re willing to commit, you’ll be better off here.” In 2006 the number of limited partnerships was boosted from 4,535 to just under 12,000—more than a third of employees.

the industry

25 Top Financial Services Firms One Big, Happy Family

Getting Hired

Jones believes in providing family-friendly financial services. “We want to be your neighborhood broker and an integrated part of the community, so that you’ve got your fireman, policeman, and your broker,” an insider says. The business is often a family affair; several insiders have brothers or uncles who are also brokers (though mothers or sisters in the field wouldn’t be unusual; two-thirds of Jones’ employees are female). That family feeling extends beyond flesh-and-blood ties. “We’re a very open environment, where everyone is on a first-name basis,” an insider says. “I’m a very satisfied employee, and I’m not the only one here who is.”

Edward Jones recruits for investment representatives (IRs—aka, brokers) throughout the country for all levels of candidates, as well as for home office positions (in St. Louis, Missouri, and Tempe, Arizona, in areas from legal and HR to IT and operations) for undergraduates and midcareer hires. However, an insider notes that the best way to get a job with the firm is to be referred by a current associate. Proactively seeking meetings with people who are already in the job shows initiative and can open doors. Internships in sales or the financial industry, as well as sales experience, also bode well for candidates. Candidates should expect a phone interview, a personal orientation profile, and a face-toface interview as part of the hiring process, all of which are weighted equally.

INSIDER SCOOP “It’s really an ideal setup. You have the backup of an organization that is very good at what it does, but you have the independence to run your own branch as you see fit.”

The Firms

No Corporate Ladder Being a one-person office means real independence and the freedom to call your own shots. “It’s not an office with 50 people fighting over a customer’s commission,” an insider says. “Without a doubt, this is my business, without the headaches of working with others.” This setup has its drawbacks, though—running your own shop can be challenging and stressful. Jones only recently began checking to ensure all branches have email, for example, a point of frustration for some employees, according to one insider. Another notes that “dealing with the red tape,” such as getting approval for setting up an office can be a time-consuming process. Still, insiders say the benefits outweigh the costs. “There are certain clientele I’m not set up to handle, but I don’t want to be a 24/7 businessman,” a broker says. “This way I can take time off whenever I want to spend time with my family.” In addition, Jones has recently instituted a new retirement plan for investment representatives that lets them pass on their business to someone else while being compensated for their previous work. 52

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Undergraduates and MBAs Jones divides recruiting into three areas: investment representatives; branch office administrators and the support staff in branches; and home offices in St. Louis and Tempe, which includes IT, marketing, finance, accounting, HR, and the like. The company recruits undergraduates for IR positions, home office support jobs, and summer internships. MBA opportunities lie primarily in IR positions, and while an MBA is not required, it is respected and considered. At the home office, recent college graduates can apply for product sales and marketing openings in the associate Rotational Development Program (RDP)— the firm’s new-hire training program. The RDP lasts one year, during which participants rotate through various functional areas every three months. “From day one, there’s a lot of responsibility,” says a former associate. “You’re not faxing things or getting other people coffee. I’ve gained more experience in one year than I thought possible.” The IR position is an option for recent graduates who sport the winning combination of selfmotivation, entrepreneurship, and sales orientation. IRs open their own branch offices within the first 180 selling days, determine their income (read: don’t get

the industry

a base salary), make their own decisions, and choose which clients to target. IRs are 100 percent vested in profit sharing from the start and earn net commissions plus trimester bonuses based on the profitability of their individual offices, as well as that of Jones itself. Jones also offers “internship and co-op” programs. The headquarters internship is offered for 12 weeks over the summer in St. Louis and Tempe, while branch internships must be arranged with individual financial advisers at their branches nationwide. The co-op program is offered to college freshman, sophomores, and juniors with IT-related majors. It’s a 40-hour-aweek, seven-month paid posting in St. Louis and is limited to the information systems division.

Midcareer Candidates Midcareer professionals comprise a large percentage of investment representative hires at Edward Jones. The firm looks for self-motivated individuals with the salesmanship and mettle to win business in new markets. The firm also recruits midcareer candidates for all home-office functions.

Recruiting Contacts For IR information, go to www.jonesopportunity.com. For information on home-office opportunities, go to www.edwardjones.com/careers.

The Firms

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25 Top Financial Services Firms

JPMorgan Chase 270 Park Avenue New York, NY 10017 Phone: 212-270-6000 Ticker: JPM www.jpmorganchase.com

the industry

Overview JPMorgan Chase is not the bank it once was. In fact, it didn’t even exist at the start of the new millennium. First came the 2001 merger of J.P. Morgan, with its shoe store’s worth of white-shoe clients and a strong investment bank franchise (renowned especially for credit derivatives, fixed income, and loan syndication), and Chase Manhattan, with its powerhouse consumer bank and budding investment bank. Then, in 2004, JPMorgan Chase, the second-largest bank in the country, merged with Bank One, the sixthlargest bank. The new firm is a colossus that nips at Citigroup’s heels, a leader in investment banking, financial services for consumers and businesses, financial transaction processing, asset and wealth management, and private equity. The $58 billion merger was widely lauded as a perfect fit. It created a combined bank that is large and powerful in a wide variety of businesses in which one or the other of its former component parts was undersized or weak. “Their strengths and weaknesses match up almost perfectly,” says Thomas Brown, an independent analyst with Bankstocks.com.

The Firms

INSIDER SCOOP

when Chase and J.P. Morgan merged, after all, Main Street and Wall Street were suddenly forced to ride the same elevator every morning. And JPMorgan Chase has paid a price for its involvement in some of the big corporate scandals of recent times, including a $350 million settlement for its role in the Enron fiasco and a whopping $22 billion settlement in a class-action lawsuit relating to the debacle. That multibillion dollar payout came on the heels of a $2 billion settlement for the WorldCom debacle. Under James “Jamie” Dimon, who became CEO of JPMorgan Chase in December 2005, the bank is cutting costs wherever possible. It also is focused on renovating its network of nearly 3,100 branches in 17 states, spending billions of dollars to upgrade technology systems and mesh JPMorgan’s tech infrastructure with Bank One’s, and growing core businesses like consumer lending, asset management, and debt underwriting. The firm continues to hire

Key Numbers 2006 2005 1-Yr. Change (%)

“Superstar cowboys who burn bridges will not do well here.”

Worldwide revenue ($M) 99,845 53,748

14.3

Worldwide earnings ($M) 14,444 8,483

70.3

Still, it hasn’t been all wine and roses for JPMorgan Chase in recent years. The bank has experienced some growing pains as a result of all those changes. For one thing, there’s been the challenge of meshing cultures;

Number of employees

3.3

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174,360 168,847

Fiscal year: January 1 through December 31 Sources: Firm’s website and annual report, SEC filings, Hoover’s, WetFeet analysis



In Thomson Financial’s M&A league tables, for the second quarter of this year, ranks 4th in worldwide announced, in worldwide completed, in U.S. target announced and in U.S. target completed.

2006

Jamie Dimon replaces William Harrison as CEO.

Recent Milestones



Named one of top 12 companies for women of color by Working Mother magazine.

2005

Signs agreement to sell life insurance and annuity underwriting business, Chase Insurance, to Protective Life for approximately $1.2 billion.



Signs agreement to sell BrownCo, its online deep-discount brokerage business, to E-Trade Financial for $1.6 billion.



Completes acquisition of Neovest Holdings, a trading technology company.



Acquires Vastera, a trade management and logistics software maker, and renames it JPMorgan Chase Vastera.



Named to Working Mother’s list of the “Best 100 Companies.”

2004

Acquires Chicago-based Bank One, the sixth-largest commercial bank in the U.S.



Enters a joint venture with British investment bank Cazenove, called JPMorgan Cazenove.



Named to Fortune’s list of the “Best Companies for Minorities.”

2007

Announces second-quarter profits of $4.2 billion, a 21 percent jump from the previous year’s numbers.



Becomes the first non-Chinese bank to incorporate in Beijing after winning approval from the mainland banking regulator.



JPMorgan Worldwide Securities Services’ Trustee & Fiduciary business hits $1 trillion in assets.



In Thomson Financial’s equity and debt capital market league tables, for the second quarter of the year, ranks 1st in global convertibles; 2nd in global debt, equity and equity related, in global mortgage-backed securities, in U.S. investment-grade corporate debt; 3rd in global asset-backed securities, in U.S. asset-backed securities, in global common stock and in U.S. mortgage-backed securities; 4th in U.S. common stock and in U.S. convertibles; 5th in U.S. IPOs and 6th in global IPOs. In Thomson Financial’s syndicated loan league tables, for the second quarter of the year, ranks 1st in global loans, in investment-grade loans, in U.S. loans and in U.S. leveraged loans.

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The Firms



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undergraduates and MBAs firmwide, and those who come on board can look forward to exciting developments. If you relish the thought of lots of responsibility—one insider says, “They’ll give you enough rope to hang yourself, but that’s what you want, right?”—and you’re willing to play by the rules and put up with some bureaucracy, JPMorgan Chase could be the right place for you to build a long and lucrative career.

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25 Top Financial Services Firms The Inside Scoop

Getting Hired

$ecret $ociety

Although plenty of JPMorgan Chase people come from moneyed backgrounds, one thing we hear about consistently is the down-to-earth attitude displayed by its recruiters. “They want to see how you’ll get along with people. So just relax,” one insider says. JPMorgan hires from top undergraduate and graduate institutions each year. The firm has formal recruiting programs only at certain colleges—for a specific reason: It wants to be as selective as possible, so it only visits schools that were selective with their admissions, which means some of the company’s screening has been done. If your school is not among Morgan’s roster, don’t give up. It will just take more initiative on your part. MBAs and undergrads follow similar recruiting tracks at JPMorgan Chase. The format generally involves three rounds of interviews: The first is on campus, and the second and third rounds are at a JPMorgan Chase office. Early interview rounds will include someone from human resources. In an on-campus interview, this round may also be with a younger professional, often a graduate of the school. Later rounds will include many people from the area to which the candidate is applying and a few senior people or team leaders.

As long as banking is about money, banks are going to hire rich kids to work for them. Some insiders talk of varying degrees of snobbishness and say they find it disagreeable. “Some people are into the whole Ivy League thing. It’s just kind of annoying,” says an insider.

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Universal Banking Model As purveyors of the full slate of wholesale and commercial banking services, JPMorgan Chase—like Citigroup—can offer junior employees a wide range of professional opportunities.

INSIDER SCOOP “It’s a green field of opportunity, and if you position yourself well, there’s nothing keeping you from switching gears into another area.”

Cold Shoulder for Hotheads The brash, aggressive, independent risk-taker may not be happy in the take-the-long-view JPMorgan Chase environment. One banker says, “Trading-oriented personalities would probably find a more aggressive firm to be a better fit.”

The Firms

Big (Elephant) Deal Most of JPMorgan Chase’s deals are huge “elephant” deals. Although the fees help the firm’s bottom line, someone just starting out in investment banking will get less exposure to massive deal volume and the invaluable experience that comes from working fast and furious on deal after deal after deal. “I knew [JPMorgan Chase was] building the I-banking practice, but I didn’t know the money was generated from elephant deals and proprietary trading,” an insider says. “These huge transactions use a ton of people, are very high profile, and you only get to work on a small portion of it.”

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Undergraduates JPMorgan Chase customarily hires undergrads as analysts in investment banking, investment management and private banking, and sales, trading, and research. In addition to mastering the finer points of spreadsheet programs, most analysts are happily preparing to be MBA candidates. Even if you decide not to climb the Wall Street pyramid, the training should prove helpful in other endeavors. There are summer opportunities for undergraduates, who are hired into specific groups as analysts, for a 10week program. Summer analysts will learn about other areas of the firm while there. In addition to business assignments, the program includes formal feedback sessions, mentoring, presentations by other areas within the bank, and organized social activities.

Consumer banking has opportunities too, in areas such as card services, and commercial banking is another option for undergrads. Additional undergraduate positions are in corporate groups (finance, operations, HR) and internal consulting services. Since this is a crossdivision department, assignments will vary, but a generalist could work on projects to improve systems and procedures in auditing, HR, financial analysis, operations, and technology, for example.

MBAs

Rather than going through HR, which is often swamped with entry-level hiring and recruiting, try to network and get your foot in the door of your target division. Also, many bulge-bracket firms use headhunters for non-entry-level positions, so consider contacting one with a solid reputation in the industry.

Recruiting Contacts To find out what jobs JPMorgan Chase is recruiting for, in what cities, how to apply, and to get updated information on recruiting, visit careers.jpmorganchase. com. There you can find descriptions of all positions and apply online.

Additional Resource For more about the firm, check out the WetFeet Insider Guide to JPMorgan Chase, available from www. wetfeet.com.

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MBAs start as associates in the same areas as undergrads, and may be promoted to vice president after three or four years. Insiders say that associates know if they’re a good fit for the firm by the five-year mark. Those who don’t become VPs opt for a position at another I-bank or change career paths altogether. Newly hired MBAs dive right into their group’s training programs. Like boot camp, according to some insiders, these are designed to prepare new hires for action on the front lines, by filling in any remaining holes in a recruit’s B-school education. Insiders say that boot camp is both fun and demanding—spur-ofthe-moment happy hours and late-night cramming for tests are important bonding experiences. The bank also hires MBAs into a host of retail financial services and commercial banking positions. JPMorgan Chase hires a number of first-year MBAs into its summer associate program. This is an excellent way to get to know the firm and, if all goes well, get a full-time offer.

Midcareer Candidates

INSIDER SCOOP “There is nothing that can beat a three-month interview for finding the right fit.”

The Firms

Although an internship is never a guarantee of future employment, many JPMorgan Chase summer investment-banking interns receive offers. The downside to that high retention rate, in the words of a recruiting insider: “I’ll be honest. It’s easier to get a full-time job than it is to get an internship.” WETFEET INSIDER GUIDE

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25 Top Financial Services Firms

Legg Mason 100 Light Street Baltimore, MD 21202 Phone: 410-539-0000 Ticker: LM www.leggmason.com

the industry

Overview With roots tracing back to the 19th century and sales up 64 percent in 2007, this firm definitely has a leg to stand on. Established in 1899, Legg Mason was long known for its work in three primary areas of business: investment advisory services, securities brokerage, and capital markets. However, in December 2005, the firm changed direction when it closed a $3.7 billion deal to acquire Citigroup’s asset-management business. The business is now called ClearBridge Advisors, and it manages $111 billion.

INSIDER SCOOP

The Firms

“Someone who is ultra-aggressive and competitive would quickly feel alienated here.” In exchange, Legg Mason handed over its brokerage business, with 1,542 financial advisers, plus some $1.5 billion in Legg Mason stock. The deal helped to make Legg Mason a major player in asset management (number five in the U.S.) and mutual funds management (also number five in the U.S.), with a roughly $992 billion in assets under management. In addition, the deal gave Legg Mason a vastly expanded distribution network for its funds, since Citi’s bankers and newly enlarged network of brokers are ready and waiting. Following the Citi deal, if you were interested in being a broker, Legg Mason broke your heart. But if you want to work in asset management, Legg Mason is one of the places to be.

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In a smaller but still significant deal, Legg Mason acquired 80 percent of the Permal Group, a manager of hedge funds with $20 billion under management, serving overseas investors. The deal gave Legg Mason entrée into a new, growing market. A smaller firm than many of its industry rivals, Legg Mason has fared well in the recent economic slowdown by cutting costs and keeping a narrow focus. It hopes that narrowed focus brings it even greater success. After all, focusing on the things it does well has already paid off for the firm in other areas. Legg Mason’s research group is much lauded, largely because it sticks to a handful of core industries: real estate, life sciences, media and technology, education, and financial services. “We are very precise in which areas we choose to go after,” an insider says. “We’re not a generic ‘We serve the middle market, come one, come all’ company.”

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 4,344

2,645

64.4

Worldwide earnings ($M) 647

1,144

-43.5

Number of employees

3,800

6.1

4,030

Fiscal year: April 1 through March 31 Sources: Firm’s website and annual report, Hoover’s, WetFeet analysis

Recent Milestones 2007

Raymond “Chip” Mason assumes title of president in addition to his duties as chairman and CEO when James Hirshmann steps down.



Reports revenue of $1.21 billion for the first quarter of fiscal 2008, up from $1.04 billion for the first quarter of fiscal ’07. Net income was $190 million. Lackluster performances lead investors to pull $7 billion from Legg Mason stock funds in the first quarter of fiscal ’08.



Places on Forbes’ “America’s Best Big Companies” list for fourth year in a row.



Named to the Fortune list of “America’s Most Admired Companies.”

2006

James Hirschmann becomes president.

2005

Agrees to swap its brokerage business plus stock for Citigroup’s asset-management business, in a deal worth $3.7 billion.



Acquires the Permal Group, a manager of funds of hedge funds. Acquires the Chicago, Cincinnati, New York, and Philadelphia offices of Scudder Private Investment Counsel from Deutsche Bank.

2004

The Legg Mason Value Trust outperforms the S&P 500 for the 14th straight year, more than any other fund.



Settles SEC and NASD charges that Legg Mason didn’t give some clients discounts they should have gotten.

The Inside Scoop Hard Days, but Few Nights Legg folks work hard, to be sure, but the hours are not as intense as they are at New York firms. “While people do work 100-hour weeks, there’s less face time than if you worked on the Street,” a recruiter says. “It’s not a place where people are here until 2:00 in the morning.” Depending on the group, hours can vary: One firstyear analyst reports working 70 hours a week while associates report minimal weekend work. Whatever the case, be prepared to work up a sweat—“You can’t come here and camp out,” quips an employee.

INSIDER SCOOP “Most people who work here are friends outside of the office. It’s a small ship—you know all the bankers at all levels and can talk to any of the three managing directors whenever you want. In New York, I question whether they would know who I was.”

Grow Up Fast Young people can move up the ladder quickly at Legg Mason. “We have smaller deal teams and offer hands-on responsibility because the bench isn’t that deep,” an insider says. “You’re not going to be doing pitch books until you’re blue in the face or sitting in a bullpen to do XYZ task. There’s a much greater degree of responsibility here at an earlier age.” There’s also the benefit of learning from former New York bankers. “My boss is from Bear Stearns and CSFB [now Credit Suisse], and I get to interact with him on a one-on-one basis,” an associate says.

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The Firms



Places fourth in The Wall Street Journal’s “Best on the Street” equity research rankings, and second in the Forbes. com/”StarMine Wall Street Top Analyst Survey”.

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25 Top Financial Services Firms Stress Relief

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Insiders say that there’s a work-hard, play-hard culture. “While people do cancel vacations and work nights, we go sailing and play department football games. Recently we had a paintball outing, and you have no idea how helpful that is to relieve stress,” an analyst says. Another reports, “After hours when all the bigwigs leave, there are Nerf footballs flying over my head.” The firm also supports employees who want to spend time with their families. “Most of the higher levels have families, and it’s a much more family-friendly atmosphere than in New York,” an insider says.

Getting Hired Recruiting for undergraduates and MBAs to staff the investment-banking group starts in September at select East Coast regional schools. One recent hire says the company’s open-door recruiting impressed him. “In my senior year, I had no idea what investment banking was,” he says. “Two senior bankers came down to my school for three consecutive weeks to give an informational seminar to teach students about the industry.” The company doesn’t have strict standards when it comes to GPAs, majors, or school prestige. Recruiters want bright, enthusiastic, hard-working, detailoriented students. The recruiting process consists of an on-campus interview followed by onsite one-on-one interviews with five to six employees. While finance majors are widely represented, insiders say that an intensive training program teaches you everything you need to know. One popular career path at Legg Mason had been the financial adviser path, but with Citi’s acquisition of Legg Mason’s brokerage business, these jobs will no longer be part of the picture at the firm.

The Firms

Undergraduates and MBAs Undergraduates typically apply for opportunities in investment banking, finance, research, legal/ compliance, funds marketing, information technology, accounting, marketing, facilities management, and operations. 60

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The I-banking group hires undergraduates as analysts for a two-year program. If hired, you’ll be analyzing financial statements, creating financial models, updating market trends, developing forecasts, and making presentations to clients. Analysts are required to get an MBA to become associates. MBAs can apply for investment banking associate positions. Responsibilities include developing client relationships, assisting with mergers and acquisitions, and performing advisory services. At Legg Mason, bankers are organized by industry as opposed to product, which means that you can experience the full range of transactions and advisory assignments instead of passing them along. “It exposed me to a lot more transactions faster, since we don’t have specifically defined product groups,” an insider says. Summer I-banking internships are offered for undergraduates and MBAs. Interns develop close relationships with mentors and rotate through different industry groups. Legg Mason recruits for these positions in the fall. Fall internships are offered in fields including HR communications, marketing, fund administration, corporate technology, and IT. A number of the undergraduate internships are offered for credit and are paid. Juniors and seniors with a 3.0 GPA or better are eligible. The application process begins in January for the summer internships and is open throughout the summer for the fall internships.

Midcareer Candidates Legg Mason hires midcareer candidates on an asneeded basis. Check the company website for a full list of job openings.

Recruiting Contacts Apply for jobs online at http://sh.webhire.com/ public/422.

Lehman Brothers Holdings 745 7th Avenue New York, NY 10019 Phone: 212-526-7000 or 800-666-2388 Ticker: LEH www.lehman.com

For Lehman Brothers, the past few years have been banner years. In 2006, the firm took home record earnings for a third consecutive year, and in May 2007 it recorded a quarterly net income of $1.27 billion. Not bad for a business that started as a general store.

INSIDER SCOOP “It’s collegial and friendly—I’m astounded that this is an investment bank.”

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue* ($M) 46,709 32,420

44.1

Worldwide earnings ($M) 4,007

21.5

Number of employees

3,260

25,900 22,900

13.1

Fiscal year: December 1 through November 30 Note: Lehman reports net revenue, rather than gross. Sources: Firm’s annual report, SEC filings, Hoover’s, WetFeet analysis

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The Firms

Lehman Brothers traces its roots back to 1844, when Henry Lehman set up shop in Montgomery, Alabama. In 1850, two of his brothers joined forces with him, and the business became Lehman Brothers. The brothers accepted payment in the form of cotton, becoming a broker of the crop. After the Civil War, the firm moved its headquarters to New York, where it began to sell and trade securities, as well as provide financial advice to clients. It eventually moved into merchant banking and securities underwriting. In 1984, the company was acquired by American Express, but in the 1990s it became independent once again. Today Lehman Brothers is a bulge-bracket global investment bank, with more than 120 offices around the world, and expertise in everything from M&A advisory and securities underwriting to sales, trading, and research to private equity, asset management, mortgage banking, and real estate investment. For a firm with its roots in the cotton industry, the

early 2000s saw an attack of the economic boll weevils. The firm struggled with the market turndown and the September 11 terrorist attacks, which destroyed its World Financial Center headquarters and left more than 6,000 employees without a place to work. But under CEO Richard Fuld, it fought back valiantly and its longtime emphasis on cost control has helped it recover more strongly than many other firms from the down years following the tech bubble burst. In 2002, the firm opened new headquarters in midtown Manhattan. “Coming to our new headquarters was a galvanizing event,” an insider says. Today, with $236 billion in assets under management the firm ought to be in hiring mode— especially in its asset-management areas. In addition, the firm has been diversifying its revenue base and growing its international revenue.

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Overview

25 Top Financial Services Firms Recent Milestones 2007

Announces the acquisition of LightPoint Capital Management, a leveraged loan investment manger with roughly $3.2 billion in assets under management.



In Thomson Financial’s equity and debt capital market league tables, for the second quarter of the year, ranks 1st in global mortgage-backed securities and in U.S. mortgage-backed securities; 3rd in U.S. IPOs; 5th in U.S. investment-grade corporate debt and in U.S. common stock; 7th in U.S. convertibles; 8th in global convertibles; and 9th in global debt, equity and equity related, in global asset-backed securities, in global IPOs; in global common stock and in U.S. assetbacked securities.

the industry



In Thomson Financial’s syndicated loan league tables, for the second quarter of the year, ranks 9th in U.S. leveraged loans; 10th in U.S. loans; 11th in U.S. investment-grade loans; and 20th in global loans.



The Firms

Places first on Fortune’s list of “20 Great Companies for New Grads” and on its list of “Most Admired Securities Firms.”



In Thomson Financial’s M&A league tables, for the second quarter of this year, ranks 5th in worldwide announced and 5th in U.S. target announced; 6th in U.S. target completed; and 8th in worldwide completed.

2006

Makes Barron’s “500 Corporate Performers of 2006” list.

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Listed in BusinessWeek’s “Top 50 Best Performing Companies.”



Receives an award for disability excellence from the U.K. Employers’ Forum on Disability.



Ranks first in Institutional Investor’s rankings of All-America Equity Research and All-America Fixed Income Research Teams.

2005

Wins 29 best-in-class awards in the Global Custodian Prime Brokerage Survey, more than any other firm.



Named “Best Investment Bank” in the power and health care sectors by Global Finance.

2004

Ranks first in Institutional Investor’s list of All-America Equity Research and AllAmerica Fixed Income Research Teams.

The Inside Scoop All for One Lehman’s team-oriented approach is embodied in the saying, “One team, one dream.” And that’s not just some rhyming rhetoric: The company links employee compensation directly to the firm’s profits, and employees own one-third of the firm. Insiders say office politics and internal competition are rare. “If you’re looking for a firm based on a star system, this isn’t it,” says one insider. Says another, “There’s no room for attitude. People like that don’t survive here.” The firm also boasts a solid culture of consistency, attributed to its tenured executive team. It’s not a “values of the week” culture, an insider says.

Getting Hired

Lehman typically does business as if it’s got something to prove on the Street. That means it’s “work hard— then harder” for employees. “You’re really pushed to achieve your maximum level,” one insider says.

Lehman actively hires undergraduates and MBAs to fill a host of intern positions every year. The company recruits at first- and second-tier schools, as well as specialty colleges worldwide, and emphasizes one-onone connections with recruits. Roughly two-thirds of hiring is at the undergraduate level, with one-third of positions going to MBAs. Full-time hires are generally sourced from these pools of ex-summer interns and ex-summer associates. When reviewing resumes and interviewing, Lehman recruiters focus heavily on leadership abilities. “We don’t hire for the specific job, but for the long term,” one insider says. Recruiters also look for clear evidence of problem solving, initiative, personal presence, and the ability to work on a team. In making hiring decisions, “we think about people’s intrinsic smarts, intrinsic leadership abilities, and their presence,” says a recruiter. “A finance degree isn’t required. The right individual on a cold call with the proper attitude can get himself into the mix.”

INSIDER SCOOP “People don’t slip out and go to the gym or put their feet up on the desk and tell jokes. While we do have light-hearted moments, we grind it out with a healthy sense of competition.”

Open 24/7 The work never stops at Lehman, and some employees have trouble maintaining a life outside of the office. New hires, in particular, clock in early and leave late—if they leave at all. A former analyst says, “Expect to work all hours.” The grueling schedule lets up a bit as you move up in the organization, but work/life balance is still an issue. “It’s an aspect of the firm we’re very sensitive to,” an insider says. “We work hard to maintain a level of balance so that people aren’t burned out. It’s trumpeted from the highest levels.”

Diversity Matters Insiders tout employee diversity—racial and ethnic—as one of Lehman’s strong suits. Mentoring and leadership programs are part of the firm’s infrastructure, as are numerous employee networks. “People have broad and fascinating backgrounds,” an employee says. “My coworkers included an Israeli paratrooper, a Chinese woman who had worked in venture capital, and a concert pianist.” In terms of gender, Lehman has few women in management, but employees insist that the company values equal opportunity. “They are not tolerant of men who underestimate women, which is rare in the industry,” an insider says.

the industry

It’s a Workout

Undergraduates and MBAs

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The Firms

Undergraduates typically apply for analyst positions in capital markets, investment banking, investment management, finance, credit risk management, information technology, operations, and corporate business services. All except for IT are two- to three-year programs, though in some areas high performers may be asked to stay with the firm after the program ends. MBAs are hired into rotational programs in investment banking, capital markets, investment management, and private investment management. With the exception of the three-and-a-half year I-banking program, the others last about 16 to 17 months. Most equities and fixed-income hires enter as generalists, which means the program gives them exposure to a broad range of activities and businesses, but those interested in equity research and analytical areas of equities and fixed income enter a program more focused on their specific area of interest. MBAs also come on board in private investment management sales, credit risk management, real estate, and public finance.

the industry

25 Top Financial Services Firms All entry-level hires commence with training in New York, where they learn about I-banking, the firm, and the skills they’ll need to succeed, before moving on to their rotational programs or full-time positions. Insiders say there’s no set timeline for promotions. “The firm tries to espouse being a meritocracy as much as it can,” says one. Lehman wants its people for the long haul and helps them move around the firm to accommodate their interests. “Lehman hires you for the organization so it’s an open job market,” says an insider who switched from banking to venture capital. “You don’t have to risk being fired like at other firms.” The firm is flatter than many of its peers, with less bureaucracy, giving new hires plenty of opportunity. Lehman continues to offer summer MBA and summer analyst programs for most of its divisions. Summer programs are a critical gateway into a job at Lehman and are where it sources most of its full-time hires. Details on Lehman’s entry-level and summer opportunities are available on the company’s website at www.lehman.com/. The firm also provides “day in the life” snapshots from people in different positions.

Midcareer Candidates According to insiders, the best way for midcareer professionals to get into Lehman Brothers is by focusing on the important industry and product groups at the firm. A high-tech or telecom specialist who speaks fluent Cantonese has a much better shot than a finance generalist does. But any previous experience at a bulge-bracket firm, private equity shop, or other markets-based business is generally a strong selling point. Top talent is always in high demand across divisions.

Recruiting Contacts

The Firms

Lehman posts recruiting info at www.lehman.com/careers/careers_home.htm.

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Merrill Lynch 4 World Financial Center New York, NY 10080 Phone: 212-449-1000 Ticker: MER www.ml.com

Overview

INSIDER SCOOP “You can’t be an average performer. You need to show how you’re the best at something—I don’t care if it’s knitting or physics. Show us how you can raise the bar.”

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 70,951 32,467

47.7

Worldwide earnings ($M) 7,499

46.6

Number of employees

5,116

56,200 54,600

2.9

Fiscal year: January 1 through December 31 Sources: Merrill Lynch annual report, WetFeet analysis

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The Firms

One of the largest U.S. securities firms, Merrill Lynch operates via a pair of segments: the Global Markets and Investment Banking Group, and Global Wealth Management. The latter amalgamates Merrill’s Global Private Client group and Global Investment Management units. In February 2006, Merrill announced plans to merge its money-management unit with BlackRock, creating a firm with nearly $1 trillion in assets under management. The agreement gave Merrill a 49.8 percent stake in the new company, which operates under the BlackRock name. With the close of the

transaction in the third quarter of 2006, the 2,569 employees at Merrill Lynch Investment Managers became part of BlackRock. All in all, it’s a diversified bulge-bracket firm with offices in 38 countries and territories and total client assets of approximately $1.7 trillion. “Mother Merrill” ranks in the Top 10 on most key investment-banking scorecards. Like other investment banks, Merrill’s bottom line was deeply wounded by the bear market of the early 2000s, and the company’s image has been tarnished by its involvement in the financial scandals of the past few years. Merrill was implicated in the ImClone/Martha Stewart insider trading scandal. And in 2002 and 2003, the firm paid $200 million to settle charges of improper research. In addition, to cut costs, Merrill eliminated more than 20,000 jobs in the early years of the new millennium. But with Stan O’Neal at the helm, Merrill seemingly has reversed its bad fortune, showing strong revenue and earnings growth over the past three years.

the industry

As Merrill Lynch has demonstrated year after year: When you mess with the bull, you get the horn. The firm, famous for its aggressive bull logo, made Wall Street into its own china shop in 2006, recording sales growth and income growth of nearly 50 percent. In 2006, the firm made noises about scooping up a mortgage lender. In 2007, it did, picking acquiring National City’s First Franklin Financial for $1.3 billion. It also announced the acquisition of San Francisco-based First Republic Bank for $1.8 billion. Known as “the firm that brought Wall Street to Main Street,” Merrill Lynch was the first of the Street’s firms to establish nationwide branch offices or advertise on television.

the industry

25 Top Financial Services Firms “There is [now] a sharp focus on profitability. Laser sharp,” says an insider. “Everybody is looking at what they’re doing and thinking about how to do it better.” That focus made its mark in 2005 and early 2006, as Merrill grew globally, increasing investments in China, India, and Japan, as well as across its divisions. In GPC, the firm strengthened its retirement offering with the purchase of AMVESCAP Retirement, and acquired regional broker-dealer Advest, and GMI added 1,600 new jobs. The MLIM division also grew through the acquisition of Netherlands-based Philips Pensions Competence Center and Philips Investment Management, the internal investment management units of Royal Philips Electronics. The acquisition gave the firm a strong foothold in the second-largest pension market in Europe.



In Thomson Financial’s equity and debt capital market league tables, for the second quarter of the year, ranks 2nd in global asset-backed securities, in U.S. asset-backed securities, and in U.S. IPOs; 3rd in U.S. common stock; 4th in global debt, equity and equity related; 5th in global convertibles, in global IPOs, in global common stock, and in U.S. convertibles; 8th in U.S. investmentgrade corporate debt; and 9th in global mortgage-backed securities and in U.S. mortgage-backed securities.



In Thomson Financial’s syndicated loan league tables, for the second quarter of the year, ranks 7th in U.S. leveraged loans; 8th in U.S. loans; 14th in global loans; 16th in U.S. investment-grade loans.



In Thomson Financial’s M&A league tables, for the second quarter of this year, ranks 5th in worldwide completed and in U.S. target completed; 7th in worldwide announced and in U.S. target announced.

2006

Tops Barron’s annual “Top 100 Financial Advisers” with 22 advisers on the list, the largest number of any firm.



Increases ownership in India’s leading investment bank, DSP Merrill Lynch, to 90 percent.

2005

Acquires Pax Clearing, a Chicago options, futures, and stock clearing house.



Acquires AMVESCAP Retirement, a retirement plan provider.

2004

Acquires Entergy-Koch Trading, an energy-trading company.

INSIDER SCOOP “Merrill has people who are smart and driven, but not to the extent that they’re not human. They’re willing to put stuff down on a Friday afternoon and go talk over a brew.”

Recent Milestones 2007



The Firms



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Opens offices in Turkey and Dubai and wins license to operate in Kingdom of Saudi Arabia. Promotes Rosemary Berkery, a close adviser to CEO Stan O’Neal (and possibly his heir-apparent), to vice chairman and general counsel. A National Association of Securities Dealers arbitration panel orders Merrill Lynch to pay a former broker of Iranian ancestry $1.6 million after ruling a branch complex director got him fired after learning of his ethnicity.

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The Inside Scoop Under Pressure When the market is up, be prepared to handle multiple products, often with very high stakes. Merrill’s industry position guarantees things will always be hopping—to the point of being overwhelming.

INSIDER SCOOP “I’m never bored, but when several projects come to a head at once, something has to give, and it’s usually my sleep.”

On the plus side, the firm’s powerful brand name and phenomenal resources mean a stronger platform from which to sell. But its sheer size means navigating through red tape. “It’s very bureaucratic,” an employee says. “You achieve things in spite of, rather than because of, the massive infrastructure that exists.”

Network Up the Ladder If you can work for a large corporation where promotion comes to those who play by the rules, Merrill may be an excellent choice for you. An insider says, “Given that most people Merrill hires are bright, it’s the people that have the ability to generate money who really succeed. Even if you’re a bright person, this takes a lot of networking and teamwork.” Another insider says, “The network of contacts you build is what is going to get you paid and get you promoted.”

Black Shoes

In the fall, Merrill recruits at colleges nationwide, but it often does the bulk of full-time hiring through its summer program participants. While a high GPA, top-tier education, and finance-related majors are assets, recruiters want candidates who excel in outside pursuits. But Merrill doesn’t want self-obsessed people who aren’t able to work with a team.

INSIDER SCOOP “We generally reject people who are egocentric. Those individuals might actually be the most intelligent and qualified people, but if they have those characteristics, they won’t be successful in our culture.”

Undergraduates and MBAs Merrill requires new blood to fill the analyst ranks every year. In 2006–07, Merrill hired about 500 undergraduates for positions in investment banking, global markets (debt and equity), global private client, and the corporate and enterprise-wide groups. Merrill encourages undergraduates with a range of degrees to apply, not just those with finance or accounting backgrounds. MBAs come on board in associate positions in global markets (debt and equity), investment banking, private client, and research. Positions also have been available for MBAs in research, private wealth services, and finance. For these jobs, Merrill looks for candidates who have previous financial experience and a good personality fit with the firm. Candidates who have never worked on Wall Street need to be versed in the industry and its trends. In 2006-07, 120 associates were hired. Interviews are usually held in October and normally include both financial questions and general discussion about you and your background. Recruiters tell us that an MBA’s GMAT score is also important. Analysts and associates in investment banking and equity markets are hired into a particular product or industry group. In debt WETFEET INSIDER GUIDE

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With senior executives originating from the lowest brokerage ranks, Merrill exhibits less white-shoe attitude than other firms do. “Out of my group of 70, no one’s a Harvard grad; a lot are from Chicago and Wharton,” an insider says. Merrill’s criteria for new hires are based more on skills than personality, which means less prescribed image and behavior. “While it doesn’t look like a Grateful Dead concert, individuality is tolerated at Merrill,” another insider says. And there

Getting Hired

the industry

Being Big Brings Bureaucracy

are unofficial standards—“We have a saying at Merrill: no jackasses here,” one employee says.

25 Top Financial Services Firms

the industry

markets, analysts and associates have the opportunity to rotate among the various sales, trading, and research divisions. Analysts work for two years, with the possibility of a third year at the firm’s request. Analysts may become associates without getting an MBA. Merrill runs an active summer training program for undergraduates and MBAs. And, as mentioned earlier, the bulk of the firm’s full-time hires come through participation in its summer programs. Regardless of whether you interview with Merrill on campus, you’ll need to complete the firm’s online job application.

Midcareer Candidates Merrill Lynch does hire some midcareer candidates who have experience on the Street. The best way to get in laterally is through networking or by working with a headhunter. If you don’t have a background on Wall Street, your best bet is to join as a financial adviser.

Recruiting Contacts If you cannot participate in on-campus recruiting, you should network with alumni from your school who work at Merrill. Go to the company’s career website, www.ml.com/careers, for application information.

Additional Resource

The Firms

For more about the firm, check out the WetFeet Insider Guide to Merrill Lynch, available from www. wetfeet.com.

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Morgan Stanley 1585 Broadway New York, NY 10036 Phone: 212-761-4000 Ticker: MS www.morganstanley.com

Overview

INSIDER SCOOP “It’s a top name among financial services organizations but a highly competitive environment.”

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 76,551 52,081

47.0

Worldwide earnings ($M) 7,472

51.3

Number of employees

4,939

55,310 53,218

3.8

Fiscal year: December 1 through November 30 Source: Hoover’s, WetFeet analysis

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The Firms

In any event, the answer to the query “To Mack or not to Mack, that is the question” has decidedly been “to Mack.” With “Mack the Knife” back at the table, Morgan Stanley has seen steady and solid prosperity—and a gaudy 51 percent jump in its net income growth in 2006. That’s a far cry from the tumultuous earlier portion of the decade. After the attacks on the World Trade Center, in which seven Morgan Stanley employees and six consultants died, company officials took pride in the fact that nearly 3,700 employees were quickly and safely evacuated. In the dark period that followed, as a spate of accounting scandals coincided with conflictof-interest allegations at major brokerage houses, Morgan Stanley was among the first to adopt more stringent controls on its operations, including a new stock-rating system.

Of course, that didn’t stop regulators from investigating the firm, along with others on Wall Street, for touting tech stocks to woo investmentbanking clients; Morgan Stanley eventually had to pay $50 million to settle charges against it, but that was a mere pittance compared to what other top banks had to pay. Also, in 2007, Morgan had to pay a $4.4 million settlement to a class-action lawsuit brought by brokerage clients. The clients paid unnecessary fees for precious-metals storage that Morgan Stanley offered as a service, but did not actually provide. Purcell had taken a grilling on the Street regarding his decision to spin off the firm’s Discover cards business, but Mack followed through on the idea. In July of 2007, Discover Financial Services debuted on Wall Street as an independent publicly traded company. The move was explained to investors as a means in which Morgan Stanley could devote itself more fully to its trading and money-management divisions.

the industry

The recent drama emanating from the executive boardrooms of Morgan Stanley has been worthy of Shakespeare’s quill. A group of former Morgan Stanley executives clamored for embattled then-chairman and CEO Philip Purcell to step down in 2005. He eventually succumbed to the pressure and was replaced by the very man he had pushed out of the position—Jack Mack, a three-decade Morgan Stanley vet who had just ended a bumpy ride with Credit Suisse.

Well, it’s hard to question success. Mack pointed out that the firm has continued its winning streak with seven consecutive quarters of equity above 20 percent, and that company goal of doubling its 2005 earnings by 2010 was in sight. Morgan Stanley remains one of the two or three most powerful banks on the Street. The firm has declined to release official hiring projections for 2007–08; however, it’s been widely reported that the firm’s competitors are beefing up recruitment for that time frame. The company is still actively recruiting on university campuses at the MBA and undergraduate levels, and many new hires are being fished from the summer intern pool.

asset-backed securities; and 8th in global asset-backed securities.

In Thomson Financial’s syndicated loan league tables, for the second quarter of the year, ranks 5th in U.S. investment-grade loans; 9th in U.S. loans; 11th in U.S. leveraged loans; and 17th in global loans.



In Thomson Financial’s M&A league tables, for the second quarter of this year, ranks 1st in worldwide completed and in U.S. target completed; and 2nd in worldwide announced and in U.S. target announced.

Recent Milestones 2007

Acquires eight European Hilton Hotels with the possibility of picking up two more later in the year. The price for all 10 is €566 million (roughly $771 million).

2006

Agrees to pay $15 million fine to settle charges that it did not produce documents and was uncooperative during investigations performed by the SEC.



Sells UK-based asset manager Quilter to Citi for an estimated $473 million.





Merges groups Morgan Stanley & Co. and Morgan Stanley DW into single brokerdealer going by Morgan Stanley & Co.

Opens an office in the Dubai International Financial Centre, its first office in the Middle East and North Africa region.



Announces sale of its aircraft leasing business AWAS, to U.K.-based Terra Firma Capital Partners for $2.5 billion in cash and the assumption of liabilities.



Roy J. Bostock, Charles H. Noski, and O. Griffith Sexton named to board of directors.

2005

Philip Purcell announces he’ll step down from his CEO and chairmanship positions.



Announces plans to spin off Discover cards business.



Agrees to purchase $2.5 billion of Downtown San Francisco office space from Blackstone Group.



In Thomson Financial’s equity and debt capital market league tables, for the second quarter of the year, ranks 1st in U.S. IPOs; 2nd in global IPOs, in U.S. common stock, and in U.S. convertibles; 4th in global common stock, in global convertibles, and in U.S. investmentgrade corporate debt; 5th in global debt, equity and equity related, in global mortgage-backed securities, and in U.S. mortgage-backed securities; 7th in U.S.

The Firms

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25 Top Financial Services Firms

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2004

Spins off Morgan Stanley Capital Partners.



Subsidiary Morgan Stanley Capital International acquires risk management software company Barra to form MSCI Barra.



Pays $54 million to settle sexual discrimination charges brought by some 300 employees.



Officially drops Dean Witter from its name.

Name Recognition Morgan Stanley is, in the words of one insider, “a kick-ass name.” Employees and non-employees alike are impressed. One insider confesses to taking pleasure in the fact that “when people ask me where I work, they say, ‘Oh, wow!’ when I tell them Morgan Stanley. Goldman is probably the only other firm that will elicit that response.”

The Best and Brightest Because of its reputation, Morgan Stanley attracts very qualified job candidates with exceptional resumes. Some insiders say that the best part of a job with Morgan Stanley is the opportunity to work with an extremely motivated staff. “The people are so bright,” says one. “You couldn’t duplicate this experience.” This level of quality has its benefits when the workload increases.

INSIDER SCOOP “We’re working with the best people, who are really efficient. You don’t work all week on something just to have it wasted.”

“People here are…well, how shall I say this?… competitive,” says a second-year associate. One firstyear says that though they tend to be the exception rather than the rule, “You do find some ‘me first’ kind

This battleship does not turn on a dime. Morgan Stanley has more than 55,000 employees spread throughout three divisions and 30 countries’ offices worldwide. The resulting thick layers of management and red tape are unavoidable and pervasive. “It’s a huge behemoth,” says one. “It has a lot of bureaucracy. A lot of politics. If it were a little leaner, it would work more effectively.” Says another, “The bureaucracy can be a bit oppressive at times.” And if Morgan Stanley is a steamer, new hires will be working in the engine room. Not everyone can take the heat.

INSIDER SCOOP “It’s a crucible—either you work really hard, do really well, and you’ll be amply rewarded, or you don’t cut it and you find your way out the door.”

Getting Hired Getting hired at Morgan Stanley could be the toughest assignment you ever tackle. So don’t dawdle in applying. “It’s imperative to get on the interview list at your school early,” says one recent hire. If Morgan Stanley doesn’t recruit on your campus, it’s still possible—and even more important—to, as an insider says, “meet people at receptions, talk to them later, set up informational interviews in New York City, and call alumni from your school.” “The summer associate recruiting process is particularly speedy,” another insider says. The firm will often contact you the night of the interview to invite you back for a second round or to ding you. Second-round interviews are usually at Morgan Stanley’s New York headquarters. A third round is possible. The process for full-time associates is similar but may move a bit slower. The recruiting process for analysts often begins on selected campuses WETFEET INSIDER GUIDE

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No More Mr./Ms. Nice Guy

U.S.S. Morgan Stanley

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The Inside Scoop

of people who won’t put their projects aside to work with you.” In other words, if you’re looking for a warm and collegial work environment where everyone’s looking out for each other rather than themselves, the cutthroat mentality of some Morgan Stanley divisions may not fit the bill.

25 Top Financial Services Firms nationwide, but much is still done in New York. Interviews are notoriously rigorous.

INSIDER SCOOP “Morgan Stanley was grueling…11 interviews in one day. They really grilled me and tried to get my wheels spinning.”

the industry

Undergraduates and MBAs If you’re graduating from college, an analyst position can be a great way to get banking, research, investment, or operations experience. Analyst positions at Morgan Stanley are for two or three years only (except for equity-financing services), at which point you are expected to leave to get an MBA or pursue other job opportunities. For a list of the areas at Morgan Stanley that accept undergrads, check out the firm’s recruiting website. The Morgan Stanley associate program offers MBAs a career path in areas such as equity research, investment banking, and investment management. Each area offers a formal training program in the basics, followed by on-the-job development, which generally includes several different rotations or assignments during the first two or three years. Beyond that, the sky’s the limit for associates. In investment banking, you’ll move up the ranks by positioning yourself for a promotion every three to four years. In research, junior analysts start under one senior analyst and, with experience, gain responsibility for their own list of stocks, and begin publishing reports. Morgan Stanley offers a full complement of summer internship programs for undergrads and MBAs. See the company’s recruiting website for more details.

The Firms

Midcareer Candidates Morgan Stanley relies heavily on its training programs for final placement, so it can be harder to get a job if you were trained elsewhere. In I-banking, lateral hires from other firms are possible, particularly if you have the industry or product expertise the firm is currently looking for. In sales and trading, people without an 72

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MBA can get hired if they have developed a client base at another firm. PhDs, other advanced-degree holders, and industry experts can find opportunities in the research division. So can research analysts from other firms, especially as these folks increasingly act as free agents, switching firms and selling their services to the highest bidder. Candidates with an advanced degree interested in IT must apply to the Information Technology Analyst Program.

Recruiting Contacts Morgan Stanley strongly encourages all candidates to apply using its online application, at www. morganstanley.com/careers.

Additional Resource For more about the firm, check out the WetFeet Insider Guide to Morgan Stanley, available from www. wetfeet.com.

Piper Jaffray 800 Nicollet Mall, Suite 800 Minneapolis, MN 55402 Phone: 612-303-6000 Ticker: PJC www.piperjaffray.com

Overview

INSIDER SCOOP “We’re no longer a regional Minnesota firm—we have a big presence now in Asia and some people in London. But our roots are still in the Midwest.”

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 535.2

814.8

-34.3

Worldwide earnings ($M) 235.3

40.1

487

Employees

2,871

-61.4

1,104

Fiscal year: January 1 through December 31 Sources: Firm’s website and annual report, SEC filings, Yahoo Finance, Hoover’s, WetFeet research

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The sale shocked few experts, as Piper has been going through some tumultuous times recently. In the first quarter of 2005, the bank reported that earnings were down 47 percent from the same quarter in the previous year; Piper blamed weak institutional trading volume. In response, it laid off some 90 employees, or 3 percent of staff, and reduced the amount of space it leases in its New York offices. The year 2006 saw the firm augment its net profit margin by a factor of nearly nine—but 61 percent of employees from the previous year weren’t around to enjoy it after being packed off to UBS. These fluctuating head and dollar counts come on the heels of the firm’s relatively newfound independence. In 1998, U.S. Bancorp acquired Piper Jaffray in an effort to bolster its presence in securities

businesses, but in 2003, the big commercial bank spun off the firm. The sale of its private client business leaves the firm with one main line of business—its private capital group, which provides equities and debt sales, trading, underwriting, and other investment-banking services to institutional clients. The group runs investment funds for high-net-worth and institutional investors. Senior management for the group was restructured in 2006, with former FAF Advisors managing director Mark Austin coming in to serve as its managing director. Piper Jaffray is headquartered in Minneapolis and has offices in Austin, Tex.; Boston; Charlotte, N.C.; Chicago; Delafield, Wis.; Clayton, Mo.; Hermosa Beach, Calif.; Denver; Helena, Mont.; Kansas City, Kans.; Lincoln, Neb.; Milwaukee, Wis.; New York; Palo Alto, Calif.; Phoenix; Portland, Ore.; Post Falls, Idaho; San Francisco; Seattle; London and Shanghai.

the industry

Piper Jaffray has always looked good on paper—the firm traces its roots back to 1913, when Harry Piper and Palmer Jaffray founded a commercial paper brokerage house. The business made a big move in 2006, selling its private client business for $800 million to UBS. Piper Jaffray used the proceeds of the units sale to move into alternative energy, business services and industrial firms, and beef up operations in London, Shanghai and Hong Kong.

25 Top Financial Services Firms

the industry

Recent Milestones 2007

Announces an agreement to buy Fiduciary Asset Management (FAMCO) for $66 million in cash with additional performance-based cash considerations.



Signs an agreement to purchase Goldbond Capital Holdings of Hong Kong for approximately $50 million.

2006

Announces sale of private client business for $800 million to UBS.



Ranks sixth in The Wall Street Journal’s “Best on the Street” survey of research analysts.



Health–care investment banking team ranks first in domestic based on number of completed initial public offerings (Dealogic).

2005

Research group begins covering the health-care industry. Ranks fourth in The Wall Street Journal’s “Best on the Street” survey of research analysts, and ties for eighth in the Forbes. com/StarMine rankings of equity research analysts.

The Firms





Ranks 10th in The Wall Street Journal’s “Best on the Street” survey of research analysts, and ties for seventh in the Forbes. com/StarMine rankings of equity research analysts.



Fined $2.4 million for improper allocation of IPO shares.



Acquires Vie Securities.

The Inside Scoop Working Off the Street Most of Piper Jaffray’s employees work outside of New York, so it’s possible you’ll end up a long way from Wall Street if you join this firm (note the offices in Montana, Nebraska and Idaho). But insiders say that distance has its advantages, like a more easygoing work environment and better work/life balance. “The hours are better, the pay is similar, and the workplace isn’t cutthroat,” says an insider at the Minneapolis office

INSIDER SCOOP “People are treated well around here. I think that has a lot to do with the Midwestern roots.”

Family Valued



Fined $280,000 and $275,000 for improper municipal securities trade reporting and mutual fund sales improprieties, respectively, by the NASD.

2004

Spins off venture capital business.



Piper Jaffray is spun off by U.S. Bancorp.

One former employee remembers in particular the firm’s commitment to keeping family a priority in its employees’ lives. “What I found to be unique in the I-banking industry at Piper Jaffray was that they strongly believed that family was number one,” the insider says. “There’s the understanding that if it’s your daughter’s birthday, someone will cover for you.” If you’re willing to do the work and play by the rules, you could go far. “Someone who is willing to keep their head down and work hard [will succeed]. I think the work ethic is really valued here,” an analyst says.



Opens Nashville fixed-income sales office.

It’s Great, But…

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While insiders expressed great satisfaction with the company, one veteran employee did tell us that Piper

Jaffrey can be a bit slow on the draw when it comes to adopting new ideas.

INSIDER SCOOP “The firm needs to continue to think big. Occasionally, you’ll see company leaders pick up a strategy they should have started many moons ago. A lot of other investment banks realized the way to make money these days is proprietary activity. And we’re starting to get more aggressive in that manner, but that should have happened a while ago.”

Piper Jaffray recruits undergrads and MBAs at top schools nationwide, with an emphasis on Midwestern schools for many undergrad positions. Last year, it recruited MBAs at UC Berkeley’s Haas School, UCLA’s Anderson School, U. of Chicago, U. of Michigan, U. of Minnesota’s Carlson School, Kellogg, New York University, Columbia, U. of Indiana and Notre Dame. It recruited undergrads at schools including Boston University, Brigham Young University, UC Berkeley, UCLA, Duke, U. of Illinois, U. of Iowa, U. of Kansas, U. of Minnesota, Notre Dame, U. of St. Thomas, U. of Texas, and U. of Wisconsin. Recruiters look for highly motivated, dedicated, and productive applicants with diverse backgrounds. The interview process includes an on-campus meeting followed by a series of meetings at company offices. A finance background is not required for analyst positions, but strong quantitative skills are necessary. Investment-banking associates and equity research analysts generally have MBAs. In addition to summer analyst and associate positions, internships are available; they can next be applied for online in December of 2007.

The bulk of undergraduate and MBA hiring is in investment banking and equity research. Other undergraduate positions are available in product services and accounting. MBAs also can apply for positions in asset management and venture capital.

Midcareer Candidates Check Piper Jaffray’s website for job openings for midcareer professionals.

Recruiting Contacts Check the company’s website, www.piperjaffray.com, for information on how to apply for jobs at Piper Jaffray.

The Firms

INSIDER SCOOP

the industry

Getting Hired

Undergraduates and MBAs

An analyst told us that continually competing with giants can induce “a Napoleonic complex,” but he adds that Piper Jaffrey has always held it own against the big boys. WETFEET INSIDER GUIDE

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Raymond James Financial 880 Carillon Parkway St. Petersburg, FL 33716 Phone: 727-567-1000 or 800-248-8863 Ticker: RJF www.rjf.com

the industry

Overview Right now it’s pay day at Ray Jay. Although smaller and lesser known than its rivals, the Florida-based operation boasts a retail network of more than 5,000 financial advisers in approximately 2,400 offices worldwide—and enjoyed a 42 percent leap in worldwide earnings in 2006. Raymond James Financial is far from a momand-pop organization. Yet what it lacks in size and publicity, it makes up in feistiness. The company has a reputation for hiring some of the Street’s best and brightest, and it boasts a top-notch equity research group; 17 of its analysts have been tapped for The Wall Street Journal’s “Best on the Street” survey 74 times between them including seven first-place finishes for analyst Jim Parker.

INSIDER SCOOP

employee financial advisers in 170 retail branch offices concentrated in the South, mid-Atlantic, and Midwest; RJ Ltd., a self-clearing broker-dealer with 60 private client branches; plus overseas brokerage operations. The private client group accounts for nearly half of the firm’s earnings. Equity & Fixed Income Capital Markets provides investment banking and sales and trading services to institutional clients, as well as producing the firm’s vaunted stock research. And Professional Asset Management manages pension, retirement, venture capital, and private equity funds. The firm also engages in retail and commercial banking activities.

INSIDER SCOOP “I’m spoiled to be paid to do what I enjoy so much and live in Florida.”

The Firms

“Raymond James may not have the name recognition, but we have a reputation for getting top professionals who think differently.” Founded in 1962, Raymond James offers a wide range of services, including investment banking, merchant banking, venture capital, asset management, mortgage and commercial lending, and insurance, through more than a dozen subsidiaries and affiliates worldwide. The firm is divided into three main lines of business. The private client group comprises Raymond James Financial Services, a network of 3,255 independent contractor financial advisers in 1,426 offices and 539 satellite offices in all 50 states; Raymond James & Associates, which employs 1,028 76

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Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 2,633

2,157

22.1

Worldwide earnings ($M) 214

151

41.9

Employees

5,259

-3.6

5,069

(including independent contractors) Fiscal year: October 1 through September 30 Sources: Firm’s website and annual report, SEC filings, Hoover’s, WetFeet analysis



Moves and expands secondary operation facility from Detroit to Southfield, Michigan.



COO Chet Helck named vice chairman of the Securities Industry Association.

2005

Forbes names Raymond James the best–managed diversified financial firm in America.



Ranks seventh in The Wall Street Journal’s “Best on the Street.”



Announces participation in a joint venture that will offer the Argentina market an independent asset-management company with offices in Buenos Aires.



Launches new, automated, proprietary compliance technology.



Steven Raney, from Bank of America, named president and chief executive of Raymond James Bank.

2004

Announces stock split.



Settles SEC and NASD charges over miscalculations in mutual fund breakpoints, paying $2.6 million.

Recent Milestones 2007

Records a 20 percent rise in its fiscal third quarter profit of $68.4 million.



Is fined $2.75 million by the National Association of Securities Dealers for failing to maintain an adequate supervisory system to monitor the sales activities of roughly 1,100 branch managers.



Through the third fiscal quarter, revenue at Raymond James’ bank stands at $79.22 million—three times the total of just a year earlier. Ranked second by Zacks Investment Research in its study of the top stockpicking brokers.



Pays $6.9 million to the SEC in the case of Dennis Herula, a former Raymond James broker convicted of wire fraud.

The Inside Scoop Work Smarter, Not Longer Business is no-nonsense at Raymond James, which means people do their jobs with a minimum of office politics. At this firm, new analysts and associates aren’t expected to work themselves into a stupor to prove their loyalty. Hours are reasonable, and people are treated with respect. “Here, there is far less hazing or face time—you don’t stay late to impress your boss,” says an insider. “The first-one-to-leave-loses mentality doesn’t work here.” WETFEET INSIDER GUIDE

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2006

the industry

Raymond James is headquartered in St. Petersburg, Florida, where the company’s name graces the Tampa Bay Buccaneers’ football stadium (in 2006, the company ensured the Bucs’ home field will be known as Raymond James Stadium until at least 2015). The firm recently moved its secondary operations center in Detroit to a larger facility in Southfield, Michigan, citing its need to be wellprepared in the event of a major hurricane in the southeast. About 20 of RJF’s offices were evacuated or damaged during Hurricane Katrina and, had the St. Petersburg headquarters been menaced, a good portion of the staff would have been funneled to Michigan. Raymond James doesn’t engage in the “mass hire, mass fire” personnel philosophies of the Street, and as a result, it came through the down market of the early 2000s in good shape. “We run a tight ship,” a recruiter says, adding, “You can go to New York and get abused or you can think about quality-of-life issues and come here.”

25 Top Financial Services Firms

the industry

Who won’t make it at Raymond James? “Someone just in it for the glamour—we are not a glamorous organization,” says an insider. “You’re not coming in here to work on front-page Wall Street Journal deals every day. You do middle-market deals and you work a lot of times with management teams that have been with their companies for 40 years, not necessarily hired guns with tons of PhDs and whatnot. They are real people and have real companies. These companies really value the service we’re giving them rather than just the next banker who comes through the door.”

Real Work Right Away As a smaller firm, it offers plenty of hands-on work for low-level employees. “Entry-level hires aren’t water boys or gofers sitting on their hands waiting for the printer,” an employee says. And another insider adds, “I talked to CEOs and CFOs on a daily basis within my first year.” Ray Jay is a small, “lean” company. “We have about 100 bankers,” notes an insider. At his last job “there were 100 bankers in my group alone.” So, even young workers get the chance to perform a broad range of tasks and can advance quickly, all without superiors peering over their shoulders as they would in larger institutions. On the other hand, you may find yourself binding your own books or formatting your own work simply because there’s no one else to do it.

Life Down Under

The Firms

Insiders say that hours at the company’s Florida headquarters are shorter than those in a New York office, but compensation is comparable because there’s no state tax. The leisurely and affordable St. Petersburg lifestyle is a major incentive. An insider crows, “I’m spoiled to be paid to do what I enjoy so much and live in Florida.”

Work with Play You hear the phrase “work, work, play” frequently at Raymond James, where having a good time with one’s peers is encouraged. Annual events include Cultural Awareness Week, Halloween parties, and 78

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talent shows. Many employees see each other outside of work. “There’s a sense of community and a sense of camaraderie,” an insider says. “You develop real friends here. This can be a real place to build a career.”

Getting Hired Raymond James conducts limited undergraduate and graduate recruiting in the fall at top schools. In recent years, the firm has recruited at Wharton, Harvard Business School, U. of Virginia’s Darden School, Northwestern’s Kellogg School, the business school at U. of Chicago, U. of Florida, U. of South Florida, the Atlanta University Center, Florida A&M, Florida State, and Georgia Tech. Raymond James has been making an effort to recruit more diverse candidates, an insider says. The bulk of hiring takes place at the St. Petersburg headquarters and Southfield, Michigan, regional office, but the company also recruits for offices in Atlanta, Chicago, Dallas, Houston, Nashville, and Princeton. Interviews consist of on-campus and onsite meetings with five to ten people and include an assessment test. Although the company likes top-tier schools, recruiters say they look at a candidate’s overall package. Above all, Raymond James wants smart, talented, personable, and driven people who have a strong sense of integrity and individuality.

INSIDER SCOOP “Our staff comes from a full range of work backgrounds. We have former CFOs, Fulbright Fellows, a former director of the Environmental Protection Agency under the Carter administration, an ex-CIA scientist, lawyers, engineers, military, even a Samoan chief, along with plenty of Whartons and Harvards.”

Undergraduates and MBAs Undergraduates are hired primarily as investment banking analysts, equity research associates, and syndicate analysts. Investment banking analysts enter a three-year program and are directly hired into a specific industry group, according to the firm’s needs

here 18 months and, if you demonstrate the skills, be promoted to vice president.” Raymond James also offers internships for high school students, undergraduates, and MBAs at its St. Petersburg headquarters and select branches in select departments.

Midcareer Candidates Raymond James hires many midcareer candidates for its broker positions. For I-banking positions, it helps to have a friend on the inside, as the company hires mainly from referrals. Candidates can apply online at the company website.

Recruiting Contacts Access an online application for all positions at the company’s website, www.raymondjames.com/careers.

the industry The Firms

and the candidate’s background. There are usually three to nine investment banking analyst slots open annually. In addition, the Options program has a small number of openings for undergraduates. The program consists of three four-month rotations. Options participants attend courses at the firm’s Raymond James University and are encouraged to complete Series 7 registration as part of the program. All positions are at the international headquarters in St. Petersburg. Applicants must submit references, essays, and interviews. Acceptance is highly competitive. “It offers great opportunities to work on projects in different departments with more responsibilities than entry-levels,” a participant says. MBAs are hired primarily as investment-banking associates, research analysts, and sales and trading associates. Like new I-banking analysts, new I-banking associates are directly hired into an industry group, according to the firm’s needs and the candidate’s background. Additional MBA opportunities exist in institutional equity sales, investment banking, equity research and other fields. One MBA is hired each year for a two-year stint as an assistant to Thomas James, the firm’s chairman. The assistant-to-the-chairman position puts new hires in the enviable position of being able to learn about the securities industry directly from James himself. Undergraduates and MBAs can apply for retail financial adviser positions concentrated in the southern, eastern, and central states. Unlike other positions, “Financial advisers really have to build their own businesses,” an insider says. “At the end of the day, it’s really diverse. It’s entrepreneurial.” The firm claims it retains 99 percent of advisers who switch to Raymond James. Raymond James has its own internal training arm, the aforementioned Raymond James University, that offers training in a variety of areas in the securities business. There is also an optional one-month program for MBAs. “You learn the job on the job,” an associate says. “It’s intense and fast and you need to be proactive and use initiative.” Promotions occur on no particular time frame. One insider says, “You can be

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25 Top Financial Services Firms

UBS Bahnhofstrasse 45 CH-8098 Zurich, Switzerland Phone: +41-44-234-4111 Ticker: UBS www.ubs.com

Primary U.S. Office: 1285 Avenue of the Americas New York, NY 10019 Phone: 212-713-7800

the industry

Overview UBS has been helping the rich get richer for nearly a century and a half. One of the world’s truly massive investment managers, the Swiss-based powerhouse has offices in more than 50 countries and nearly 79,000 employees (39 percent are located in the Americas). There’s nothing small about UBS. It operates under three divisions—Global Wealth Management & Business Banking, Investment Bank, and Global Asset Management.

INSIDER SCOOP

The Firms

“This is the most European, laid-back culture you’re going to get on the Street, and it was business casual far before the dot-com era.” In the U.S., UBS primarily does business through its investment-banking and wealth-management divisions—formerly UBS Warburg and UBS PaineWebber—but also through its asset-management group. In 2006 it snapped up Piper Jaffray’s private client business for $800 million. The investmentbanking arm of UBS, the leading Swiss bank, has been making strides in its efforts to make inroads in the U.S. marketplace. “Our plan was to expand domestically and to do so aggressively, and that plan is still on track,” an insider says. “We want to win.” The investment-banking unit’s operations include debt and equity finance, sales and trading, advisory services, research, risk management, foreign exchange, and private equity. Notable strengths are in equity research and fixed income. 80

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UBS is also making strides internationally. In addition to holding stakes in the Bank of China, in 2006 it picked up Banco Pactual of Brazil for $2.6 billion and hatched plans to move into into Russia as well. Also in that year the firm acquired the global futures and options business of ABN AMRO for an estimated $400 million. Like so many companies in 2007, though, UBS was singed in the subprime mortgage market. It shut down its Dillon Read Capital Management Division (but not before $300 million vanished). Red ink and disgruntled shareholders proved too much for CEO Peter Wuffli; he had already taken a hit in ’06 when investment banking whiz Ken Moelis exited and took a number of his best people with him. In July of 2007, Wuffli was ousted in favor of Marcel Rohner.

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 105,753 76,292

38.6

Worldwide earnings ($M) 10,461 10,664

-1.9

Number of employees

13.5

78,986 69,569

Fiscal year: January 1 through December 31 Source: Hoover’s

Recent Milestones 2007

In wake of $300 million bloodbath in subprime mortgage investments, Dillon Read Capital Management Division is closed and CEO Peter Wuffli is replaced by Marcel Rohner.

2006

Takes private client business off of Piper Jaffray’s hands for $800 million.



Announces plan to acquire the global futures and options business of ABN AMRO for $386 million.

Jumps nine spots on the Fortune Global 500, from 36 to 27.



Announces plan to acquire Banco Pactual of Brazil.



National Association of Securities Dealers panel dismisses claim brought by cofounder of Subway restaurants, Fred DeLuca, that UBS acted improperly when it lost $190 million of DeLuca’s investments on tech stocks.



Receives Russian banking license.

2005

Announces restructuring of its wealthmanagement operations that incorporates the Wealth Management USA business group into its Wealth Management & Business Banking group, to be renamed Global Wealth Management & Business Banking.

2004

Acquires Schwab’s SoundView Capital Markets business for $265 million.



Announces layoff of 500 employees, or 3 percent of workforce, signaling that the worst is not yet over for investment banking.



Named “Best Bank” by both Euromoney and Investment Dealer’s Digest.







In Thomson Financial’s equity and debt capital market league tables, for the second quarter of the year, ranks 1st in global IPOs; 2nd in global common stock; 6th in U.S. IPOs; 7th in U.S. common stock; and 10th in global debt, equity and equity related, in global convertibles, and in U.S. convertibles. In Thomson Financial’s syndicated loan league tables, for the second quarter of the year, ranks 8th in U.S. investment-grade loans; 10th in global loans and in U.S. leveraged loans; and 11th in U.S. loans. In Thomson Financial’s M&A league tables, for the second quarter of this year, ranks 6th in worldwide announced; 7th in worldwide completed, and 10th in U.S. target announced and in U.S. target completed.

the industry



The Inside Scoop Not Yet a Melting Pot

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The Firms

Combine seven American and European financial companies with talent from top rivals, and you get a corporate culture in which both the work environment and social interaction are somewhat fragmented. Groups from different feeder companies tend to stick together. That said, the mixture invigorates some employees.

25 Top Financial Services Firms INSIDER SCOOP “UBS isn’t your typical firm. It’s not all TypeA people, and it’s not as cutthroat. We work together, not against each other.”

the industry

Get on the Fast Track Good employees move up quickly. With UBS taking on smaller deal teams than most of the big firms do, competition for key positions is minimized. There’s plenty of responsibility for those who want it, and that means a fast promotional track. An insider says, “There’s more head and elbow room, which means there’s less people fighting over deals at your level and there’s a lot more responsibility for the levels above you.” Another says, “I’m an impatient person so I wanted to be at a place where I can ramp up faster than across the Street.”

Getting Hired UBS aggressively recruits undergraduates and MBAs to staff its U.S. offices. Most of the full-time and summer internship hiring takes place for Chicago, Dallas, Houston, Los Angeles, New York, San Francisco, and Stamford, Connecticut. Additional opportunities exist in London, Hong Kong, and Tokyo. Interviews vary according to group. In the investment banking group, applicants meet with 12 employees, on average. In addition, the I-bankers are likely to wine and dine their candidates with a reception or dinner, so bankers can get a sense of the applicants in an informal setting. But don’t overdo it on the wine. “Those conversations count as interviews,” a managing director says.

The Firms

Undergraduates and MBAs Undergraduates can apply for full-time positions in investment banking, fixed income, rates and currencies, equities, operations, and information technology. MBA opportunities include positions in investment banking, fixed income, rates and currencies, equity sales, and equity research. The firm offers summer internships for both undergraduates and MBAs. Interns receive training 82

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in investment banking, fixed income, rates and currencies, equities, or operations and information technology. The firm often dips into its internship pool when ladling out full-time jobs. UBS provides its employees with continuing training, with classes that range from a few hours to two weeks. The broad selection of courses includes business-specific classes, financial markets education, business education, technology education, management development, client and distribution skills, and options classes.

Midcareer Candidates Although UBS strongly believes in promoting from within, it often hires top talent from other firms. Networking to gain an internal referral is always encouraged, but you can also apply for open positions online.

Recruiting Contacts Check with your career center to find out when UBS’s various groups are recruiting on campus, or go to the bank’s career website at www.ubs.com/graduates.

Additional Resource For more about the firm, check out the WetFeet Insider Guide to UBS AG, available from www. wetfeet.com.

U.S. Bancorp 800 Nicollett Mall Minneapolis, MN 55402 Phone: 651-466-3000 Ticker: USB www.usbancorp.com

Overview

INSIDER SCOOP “The staff is young, and people are allowed to do what they are good at.” U.S. Bancorp was formed in 2001 when Firstar, a growth-minded bank-holding company, bought rival U.S. Bancorp and took on the latter firm’s name. A key subsidiary is its Nova Information Systems business,

which provides payment-processing services. In 2003, the bank spun off its Piper Jaffray investment bank subsidiary to concentrate on core business areas. A big part of U.S. Bancorp’s strategy is focused on customer service. As part of that focus, it’s opening branches in Safeway, Walgreens, Schnucks, and other stores. It’s also known for pushing decision-making power down to the branch level whenever possible, to better meet customers’ needs. At the tail end of 2006, vice chairman Richard Davis took the place of CEO Jerry Grundhofer, who had led the company since the mid-1990s. Grundhofer kept his position as chairman until the end of 2007.

the industry

While the name “Half of the U.S. Bancorp” would be more accurate, U.S. Bancorp still boasts nearly 2,500 branches in 25 of the 50 states as well as not quite 14 million customers and $223 billion in assets. Headquartered in Minneapolis, U.S. Bancorp— the holding company for U.S. Bank and other subsidiaries—is the sixth largest bank-holding company in the nation. It offers a complete range of financial services to business, retail, and private banking clients. Its goal is to become a truly national bank, and it’s making strides in that direction by gobbling up smaller regional banks and expanding operations to new markets. Case in point: In 2007 it purchased the Montana-based bank United Financial. One year earlier it moved into Colorado with the purchase of holding company Vail Banks.

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 19,109 16,702

14.4

Worldwide earnings ($M) 4,751

5.8

Number of employees

4,489

50,000 49,684

0.6

Fiscal year: January 1 through December 31 Source: Hoover’s

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Recent Milestones 2007

Acquires Montana-based bank United Financial.



American Airlines and Nova Information Systems (U.S. Bancorp’s wholly owned subsidiary) enter into a multiyear creditcard processing services agreement.



U.S. Bank kicks off loan program for military veterans, reservists, National Guard members and their spouses or widows to help small businesses.

2006

Announces acquisition of Vail Banks of Colorado.



U.S. Bank completes purchase of the corporate trust and institutional custody businesses of Wachovia.

2005

Ranked by Fortune as second-best company in the world when it comes to return on revenue.



Opens new service center in Coeur d’Alene, Idaho, which will ultimately employ 500 people.



Opens two new offices in Dallas, one for corporate trust services business and another for real estate business.



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Buys back more than $700 million in debt securities. Moody’s ratings service upgrades U.S. Bancorp’s long-term debt to Aa2 from Aa3, due to the bank’s strength in credit cards and payment processing.

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2004

Opens new branches in Arizona. One of eight banks sued by American Express over business lost because of anticompetitive practices that prohibited banks that issued Visa and MasterCard cards from issuing American Express cards.



Names Richard Davis president and COO.

The Inside Scoop Go Get ’Em U.S. Bancorp promotes its employees based upon merit rather than seniority. That means hardworking employees can expect to move up rapidly in the ranks after working there only a short while.

INSIDER SCOOP “The firm isn’t afraid to promote people quickly.”

Lifelong Learning Insiders tell of great opportunities to learn through training, mentoring, and working in small teams. “The firm promotes an open exchange of ideas and a teamoriented approach,” an employee says. “Managers are accessible and want to help you progress through the firm.”

Getting Hired U.S. Bancorp hires for a variety of corporate and branch positions. Check its career website at www. usbancorp.com/careers for currently open positions.

Undergraduates and MBAs The bank has done on-campus recruiting in the past; check with your school’s career center to see if it’s coming to yours. U.S. Bancorp also travels the expo and conference circuit, putting in appearances at events such as the National Black MBA Association Career Fair and the National Urban League Conference. At U.S. Bancorp, there are job opportunities for undergraduates and MBA

students in consumer banking, commercial banking, corporate banking, investment and insurance sales, payment services, operations/technology/information services, private-client/trust/asset management, credit administration, and financial management and reporting. The bank offers a management-training program. Participants are assigned to a branch, where they learn on the job; they also undergo formal training. Subjects covered during the nine-month program include banking, banking products, banking sales, corporate partnerships, and leadership and management skills. the industry

Midcareer Candidates Experienced candidates should check the bank’s website to learn about open positions and use their network of contacts to give themselves a leg up when it comes to applying for jobs.

Recruiting Contacts For a list of U.S. Bancorp positions, visit the company’s website at www.usbancorp.com/careers.

The Firms

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Vanguard Group 100 Vanguard Blvd. Malvern, PA 19355 Phone: 610-648-6000 www.vanguard.com

the industry

Overview Arrrrgh, Vanguard! The nautically fixated index-fund pioneer, Vanguard has sailed its way into being the second-largest asset manager in the country, behind Fidelity Investments. Long the fastest-growing mutual fund company in the country, Vanguard isn’t complacent about its offerings. The company also has operations in brokerage, variable and fixed annuities, and life insurance, in addition to financial planning, asset management, and trust services. Revered founding CEO John Bogle’s philosophy was to give investors a low-cost way to participate in market gains without paying high commissions or management fees. He started Vanguard in 1975 with the idea that a mutual fund should not be owned by outside stockholders. Unlike Schwab (which is a public company) or Fidelity (which is privately owned by the Johnson family and its employees), fund shareholders own Vanguard. “We serve one master—we work to build wealth for our shareholders,” an insider says. “We don’t worry about anyone else.” This ownership structure makes Vanguard the only “mutual” mutual fund company and helps keeps costs low and commissions nonexistent.

INSIDER SCOOP

The Firms

“We are a very competitive organization, but we compete with the outside world, not internally.” When it first opened its doors, Vanguard offered 11 funds and had about $1.8 billion in assets. Today, Vanguard offers more than 143 funds to U.S. customers, plus 40 in foreign markets, and manages approximately 86

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$1.24 trillion in U.S. mutual fund assets, including more than $290 billion in employer-sponsored retirement plans. It continues to be known for its index funds, its low fees (it offers at least 10 exchange-traded funds with total expense ratios lower than .15 percent), and for conservative investing in nonindex funds. In fact, it’s increasingly using multiple managers to oversee its funds, a tactic which tends to limit returns but prevent disastrous fund performance. You’ll find Vanguard offices in the U.S. in Malvern and Valley Forge, Pennsylvania; Scottsdale, Ariz.; and Charlotte, N.C., and overseas in Brussels, Melbourne, Singapore, and Tokyo. Vanguard has been a major inducer of price wars in the mutual funds industry. To try to keep up with Vanguard’s impressive growth, Fidelity, among others, has cut fees related to many of its mutual fund offerings. Vanguard has never resorted to layoffs, though it reorganized its staff in 2001. It took four years for its ranks to grow larger than 2001 numbers. The company recruits undergraduates at regional colleges and makes a relatively small number of MBA hires.

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) n/a Number of employees

2,600

11,700 11,500

n/a 1.7

Fiscal year: January 1 through December 31 Note: Most complete data available Sources: Firm’s website, Hoover’s, WetFeet analysis

Recent Milestones Makes Fortune’s annual list of the “100 Best Companies to Work For” for third consecutive year.



Vanguard’s online site is named to Forbes magazine’s “Best of the Web”



Included on the Computerworld “100 Best Places to Work in IT” list.



Listed in the “Top 100 Places to Work” by Black Collegian magazine.



Listed as a “Top 100 Company for Training and Development” by Training Magazine.

2005

Announces that units of its employeecompensation plan appreciated by more than 11 percent during 2004.



Expands Admiral Shares program, which offers extremely low fees to customers with sizeable, long–standing accounts.

2004

Adds hundreds of staff to Scottsdale office.



Expands its offerings of the new exchangetraded funds class of funds.



Launches new online research tool for funds and stocks.

The Inside Scoop Naval Gazing

All Hands on Deck Vanguard strongly promotes team camaraderie, a strong customer focus, and the highest levels of integrity. Management maintains a flat organizational structure and, when necessary, even the top hands pitch in to answer customer questions and take orders. “People who are successful are willing to roll up their sleeves and get the job done,” a recruiter says.

INSIDER SCOOP “Although it’s really large, walking in, it feels like a mom-and-pop shop. There are more than a thousand people working in my office and I know most of them.”

Benefit Bounty A series of extremely generous benefit packages ensure there’ll be no mutiny on the Vanguard. All employees share in company profits and are eligible for annual bonuses. There are 401(k) and retirement plans that are paid for by the company (it annually invests its money into Vanguard funds selected by the employee). “I could go on about the benefits of working here,” an insider says. “It was the initial reason I took the job.”

A Tight Ship Insiders report 40-hour weeks, but with extremely little downtime. “Everyone works really hard in a fastpaced environment,” an employee says. It’s definitely not laid-back—the company insists on business formal wear. An insider says, “The biggest complaint I hear is wanting more business casual days.”

Getting Hired Vanguard recruits in the fall and spring at numerous campuses around the nation to staff its Arizona, North Carolina, and Pennsylvania offices. In addition, for MBAs, Vanguard typically has recruited at the National Black MBA Association and National Society WETFEET INSIDER GUIDE

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Vanguard is named after one of Admiral Horatio Nelson’s ships, and the nautical theme permeates the company’s workplace. Like that of sailors, Vanguard boasts a close-knit, cooperative culture. It even calls its workers “crew members,” and each Vanguard location has its own amenities store, called the Chandlery (a mini-mart, which provides services such as dry

cleaning, auto oil changes and film processing). The cafeterias are called galleys, and the onsite fitness center is called Ship Shape.

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2007

25 Top Financial Services Firms

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of Hispanic MBA career fairs. Generally, recruiters look for candidates with a background in finance or information technology, but that isn’t an exclusive requirement. An employee says, “There’s a good mix of people, with many from liberal arts backgrounds and all age levels, which creates a great atmosphere to pull off a lot of resources and perspective.” Vanguard wants self-motivated candidates with great interpersonal skills. An insider says, “We want people who aren’t out for themselves but who want what’s best for the team and the company.”

Undergraduates and MBAs Undergraduates are hired as needed, with opportunities in financial, institutional, retail, information technology, and corporate services areas. In the financial division, you’ll establish daily valuations of Vanguard funds. In institutional, you’ll work with companies on retirement plans. In retail, you’ll provide financial planning for individual investors; and in corporate services, you’ll manage and track a broad range of Vanguard funds, in addition to providing communications and related financial services for clients. Vanguard also offers rotational specialty programs that offer opportunities for mentorship by Vanguard executives. MBAs often move into planning, marketing, or analyst functions.

INSIDER SCOOP

The Firms

“There’s the possibility of strong pay and quick promotion if you deliver. They make sure you’re compensated for quality work. They also ensure that people are ready to move to the next level.” Vanguard encourages the personal development of its employees and provides ample support and resources. As soon as you start at Vanguard, you receive a written account of your responsibilities and longterm goals. “They really care about the crew and help you succeed, and it makes you care about the company and want to make it successful,” an insider says. Performance reviews are a year-round process between crewmember and supervisor to achieve targeted goals. 88

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There are many avenues to choose from at Vanguard. To avoid layoffs, Vanguard accommodates lateral moves and encourages people to explore career interests. Insiders speak highly of the training, including the specialty training programs AIM (Acceleration into Management); ACE (Acceleration into Client Engagement); TLP (Technology Leadership Program); and AFP (Acceleration into Financial Professional). There’s also an internal career database where employees can store their Vanguard resumes and apply online for jobs that interest them, as well as the newly introduced Vanguard eCareerNavigator, a series of online self-assessment exercises employees can use to measure strengths and weaknesses. All told, the company allocated just under $10 million on training programs in 2007. “Right when you walk in the door, you get the feeling that the company wants to help you succeed,” an insider says. Vanguard offers full-time paid summer undergraduate internships at all three locations in areas such as finance, client relations, and information technology. The firm also sponsors a yearly Minority Scholarship Program that awards merit-based scholarships to undergraduates. Summer internships in areas such as marketing, financial analysis, and relationship management are offered to MBAs.

Midcareer Candidates Vanguard regularly hires for its broker positions, but you can also apply online for other jobs.

Recruiting Contacts If you cannot participate in a recruiting event, apply online, at careers.vanguard.com/pljb/vanguard/ vgcareers/applicant/VG/home.shtml, or via mail.

Wachovia 1 Wachovia Center Charlotte, NC 28288 Phone: 704-374-6565 or 800-922-4684 Ticker: WB www.wachovia.com

Overview Wachovia’s multibillion dollar shopping spree carried on into 2007. “People here can have a life and families.” In May of that year, the North Carolina-based banking behemoth announced it had reached a deal to acquire investment broker A.G. Edwards for $6.8 billion. The combined brokerage will be the St. Louisbased Wachovia Securities, and will feature 14,784 brokers and $1.15 trillion in assets. The deal was slated to be finalized in fall of 2007, with A.G. Edwards fully integrated into Wachovia by 2009.

INSIDER SCOOP “Wachovia Securities has done six mergers since 1998—we’ve got this process down.”

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 46,810 35,908

30.4

Worldwide earnings ($M) 7,791

17.3

Number of employees

6,643

108,238 93,980

15.2

Fiscal year: January 1 through December 31 Sources: Firm’s website and annual report, SEC filings, Hoover’s, WetFeet analysis

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The A.G. Edwards grab came on the heels of the company snapping up Golden West Financial for $25.5 billion in 2006 as well as finalizing a nearly $4 billion purchase of AmNet Mortgage. Wachovia also bought Ameriprise Financial, the Asian business of UnionBanCal and Ameircan Property Financing. Wachovia Corp. is a result of the merger of First Union and Wachovia in 2001, in which it ended up taking the smaller company’s more prestigious name. (If you’re interviewed, be sure to pronounce it “wa-ko-vee-uh.” Incidentally, “Wachovia” is the Latinized version of “Der Wachau,” an early Germanic name for Winston-Salem, N.C.) With 3,400 financial centers and 770 retail brokerage offices, Wachovia is

the industry

INSIDER SCOOP

the nation’s fourth-largest bank-holding company in assets. Its focus is on retail banking, retail brokerage, and capital management as well as conventional capital markets businesses. In other rankings, Wachovia is also among the nation’s leaders in cash management providers, highyield underwriting, and loan syndications. In research, Wachovia Securities continues to serve companies with a market cap of $250 million to $1.5 billion. On the hiring front, parent company Wachovia is actively recruiting undergraduates in commercial and consumer banking. At Wachovia Securities, entry-level hiring has fluctuated over the past couple of years, but the firm continues to hire undergraduates and MBAs firmwide. Unlike many firms, there have been minimal layoffs at Wachovia; instead, insiders say, the company has tended to transfer employees to busier sectors. “Since the market is down in M&A, investment bankers have the opportunity to see other products,” an insider says. “Rather than fire people, management has used the opportunity to cross-fertilize associates.”

the industry

25 Top Financial Services Firms Be that as it may, in the wake of the A.G. Edwards acquisition, the firm plans to close as many as 230 of Wachovia Securities’ projected 3,350 offices within three years and cut roughly 4,000 jobs—one-fourth of workers who are not Series 7 brokers. This should result in $395 million of annual cost savings for the blended company. A spokesperson told us that hiring plans at Wachovia Securities are in flux. Wachovia offers retail banking customers a full range of financial services (such as credit and debit cards, trust services, mortgage banking, home equity lending) through offices in 21 states—Alabama, Arizona, California, Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, Kansas, Maryland, Mississippi, Nevada, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas, Virginia—plus Washington, D.C. It has retail brokerage offices in 48 states (with more than 10,800 registered reps) and operates internationally in 40 overseas offices. Wachovia serves a total of 13 million households and businesses. The bank had total assets of just under $720 billion at the end of June 2007.

in U.S. asset-backed securities; and 8th in U.S. asset-backed securities.

In Thomson Financial’s syndicated loan league tables, for the second quarter of the year, ranks 4th in U.S. loans and in U.S. investment-grade loans; 8th in U.S. leveraged loans; and 11th in global loans.



In Thomson Financial’s M&A league tables, for the second quarter of this year, ranks 15th in U.S. target announced and 17th in U.S. target completed.

2006

Completes merger with Westcorp and WFS Financial.



Completes acquisition of AmNet Mortgage, the parent company of American Mortgage Network, a wholesale mortgage banker.



Completes acquisition of the defined contribution–recordkeeping business of Ameriprise Financial.



Announces acquisition of Golden West Financial.



Announces plan to acquire the Asian business of UnionBanCal.



Announces plan to sell its HomEq mortgage servicing unit to Barclays Capital.



Announces plan to acquire American Property Financing, a wholly owned subsidiary of Emigrant Bank.



Ranked in Top 10 corporate donors by BusinessWeek. Named one of America’s “100 Best

Recent Milestones 2007



The Firms





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Announced purchase of A.G. Edwards for $6.8 billion, with full integration into Wachovia slated for 2009. Rakes in a record $2.3 billion in the second quarter of the year, a 24 percent jump from last year’s second quarter. Along with Deutsche Bank, Wachovia lands an advisory role on Fortress Investment Group and Centerbridge Partners $5.7 billion buyout of Penn National Gaming, putting the banks in line for heavy financing and advisory fees. In Thomson Financial’s equity and debt capital market league tables, for the second quarter of the year, ranks 7th in U.S. investment-grade corporate debt; 8th

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Companies for Working Mothers” by Working Mother magazine, for 10th time. Sells its Corporate Trust, Institutional Custody, Document Custody, and Structured Finance Trust service units to U.S. Bank, the lead bank of U.S. Bancorp.



Reveals that it has discovered that two firms that became part of the bank by acquisition once owned slaves, and apologizes to America—particularly to African Americans. Also reveals that other banks that it acquired in the past had indirectly profited from slavery in the 19th century.



Acquires insurance broker Palmer & Cay.



Opens branch in Shanghai, China.



Combines Equity Capital Markets and Equity Linked Products into a new Equity Division as part of strategy to lead-manage more equity stock offerings while pumping up its equity derivatives business.

2004

Acquires SouthTrust for $13.7 billion.

The Inside Scoop Immediate Immersion

INSIDER SCOOP “Being in Charlotte as opposed to New York, you fought with the fact you’re a new name on Wall Street—other banks have been there for years. But in terms of skill and credentials, we stack up with anybody. Everybody at Wachovia has a chip on his shoulder to prove they’re as good if not better than every other bank out there.”

Big Player in a Smaller Market Like other smaller investment firms, Wachovia works in middle market M&A, dealing with smaller companies that aren’t in the Fortune 500. “I like working for that market because those companies tend to look at investment banks as advisers rather than as an outsource to a finance department,” says an insider. But unlike other smaller investment firms, Wachovia has the support of a large bank, which makes it a top player. Another insider says, “Other boutiques are restrained by not having a large bank balance sheet, which differentiates us from smaller shops.” That being said, this is a cavernously large place and it seems to grow by the minute.

INSIDER SCOOP “It was high-energy with a lot of people pushing toward the same goal all in unison, which I liked. But the thing I didn’t like was just the sheer size of the organization. You can do a lot to stick out from the crowd, but in the end you’re still part of the bureaucracy.”

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Wachovia Securities’ I-banking group gives new hires an opportunity to work one-on-one with senior executives and to work directly on deal teams. “I’ve worked with a managing director with no vice president in the middle,” an analyst says. “I like having a lot of contact with the people who are running my group—it gives me the opportunity to add something new beyond rote analyst work, and my ideas are looked at instead of thrown to the bottom of the pile.”

Insiders say the promise of fewer hours and a better quality of life attracts many New York bankers to Wachovia. Says an insider who benefited from the company’s paternity leave policy, “The firm is very accommodating of family obligations. We are utterly devoted to the job, but when certain life events come up, folks clear out of your way and let you experience them.”

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Staying off the Street

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25 Top Financial Services Firms Getting Hired

Undergraduates and MBAs

MBAs typically come in at the associate level, while undergraduates enter as analysts. In years past, Wachovia has hired approximately 45 analysts and one-third as many associates. Wachovia recruits at East Coast colleges and top MBA schools in the fall, with an emphasis on both undergraduate and MBA hiring in investment and commercial banking positions. Generally, Wachovia prefers finance, technical, and quantitative degrees for undergraduates and graduates, but it will consider other degrees at the undergraduate level. When hiring MBAs, the company looks for analytical and strategic thinkers with good grades and three to five years of meaningful work experience before entering business school. “You have to know what you’re getting into and show that you can handle it,” an employee says. “This job isn’t for everyone.” Recruiters say that, to avoid a cookie-cutter environment, they want candidates from eclectic backgrounds. Although there’s a definite focus on finance and top-tier schools, at the associate level there’s a lot of variety in previous work experience. “It’s not all Ivies, but it’s not all tier-two schools either,” an insider says. ”We have highly qualified people from a variety of majors,” another insider says. For investment banking, the hiring process consists of a two-on-one campus interview followed by an onsite visit. At the headquarters, it’s a daylong series of events, during which you dine, network, and formally interview with managers, senior executives, and prospective coworkers. Occasionally, another half- or full-day program may follow. Wachovia offers a breakdown of its interviewing process and advice at www.wachovia.com/inside/page/0,,137_360_394,00. html.

Undergraduates can apply for positions in Wachovia Securities Corporate and Investment Banking Analyst Program; finance; information technology; and customer analysis, research, and training (CART), as well as the general bank group. Undergraduates and MBAs can apply for summer associate and full-time associate positions in corporate and investment banking, respectively, corporate finance, consumer and industrial/M&A, and privateequity group coverage; credit capital markets; financial sponsors group; financial services investment banking; global corporate banking; and asset securitization. Promotion is based upon individual performance and the number of years worked. “Extraordinary individuals can get promoted quickly,” an insider says. The company offers financial internships for undergraduates in various departments. MBAs are eligible to apply to the investment banking summer associate program in Charlotte. Many receive full-time job offers after completing the program.

The Firms

INSIDER SCOOP “People had different experiences in their groups, but I don’t think I could have been treated much better. I was in a good group at a great time with great people. It’s very hard to get all three of those to line up in this industry.” 92

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Midcareer Candidates Apply for a range of openings across business lines at www.wachovia.com/careers.

Recruiting Contacts If you cannot participate in a recruiting event, send in a cover letter and resume. For more information, go to www.wachovia.com/careers.

Wells Fargo 420 Montgomery Street San Francisco, CA 94104 Phone: 866-878-5865 or 800-869-3557 Ticker: WFC www.wellsfargo.com

Overview

INSIDER SCOOP “People in the industry perceive us as boring and plodding along, but we’re doing incredibly well, with great earnings.”

Key Numbers 2006 2005 1-Yr. Change (%) Worldwide revenue ($M) 47,998 40,527

18

Worldwide earnings ($M) 8,484

10.6

Number of employees

7,671

159,000 153,000

4

Fiscal year: January 1 through December 31 Sources: Firm’s website and annual report, Hoover’s, WetFeet analysis

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Stumpf has acknowledged that he will carry on Kovacevich’s signature strategy—cross selling. The average WF retail customer uses 5.3 Wells products, including checking and savings accounts and 401(k) retirement plans. Business customers average more than six.

In 2006 the bank acquired Secured Capital, a commercial real estate brokerage, and merged it with its subsidiary Eastdil Realty to form Eastdil Secured. It also announced an agreement to acquire Reilly Mortgage Group. That merger followed the 2005 acquisition of most of the funds and assets under management of Strong Financial—about $34 billion worth—as well as the 2005 purchase of Houstonbased bank First Community Capital. The bank consistently posts solid financial results, which allows it to keep spending on acquisitions. Wells Fargo offers undergrad and MBA hires wellregarded professional development training programs. These programs introduce candidates to various areas of the business, with a combination of classroom training and work experience. The bank’s retail banking operation relocated from San Francisco to Los Angeles in 2002. Wells has more than 23 million customers and 6,027 stores and manages $486 billion in assets.

the industry

In Wells Fargo’s old stagecoach days, riding shotgun really did mean riding shotgun. While the image of the red-and-gold coach careening through the desert will induce a wave of nostalgia among those who recall the old commercials—and you can see a full-sized stagecoach replica at the bank’s San Francisco headquarters— Wells Fargo is not wallowing in the past. As the market leader in online banking and services, the firm has shown that it’s willing to take risks on new technology to compete. It’s also willing to invest in its business; even during the economic downturn of the early 2000s, Wells Fargo continued to grow through acquisition. Overall, it has made 1,500-plus acquisitions in more than 150 years. That willingness to invest may have something to do with the company’s cowboy hat–wearing former CEO Richard Kovacevich, who has made it clear that he doesn’t want to be seen as a penny–pincher (John Stumpf took over as CEO in June of 2007, but Kovacevich—with his Stetson hat—remained as chairman).

25 Top Financial Services Firms Recent Milestones 2007

Wells Fargo LLC fined $250,000 by the National Association of Securities Dealers for failing to disclose that research reports about semiconductor firm Cadence Design Systems were penned by an analyst seeking a job at that company.

the industry



Agrees to purchase Greater Bay Bancorp for $1.66 billion and Placer Sierra Bancshares for $636 million.



Finishes in the cellar among Western banks in J.D. Power and Associates customer survey in all categories: overall banking experience; transaction methods; accuracy and clarity of account statements; account initiation/product offerings; convenience; fees and problem resolution.



process.

Makes Working Mother’s list of the “100 Best Companies for Working Mothers.”



Ranks 40th on DiversityInc.’s list of the “Top 50 Companies for Diversity.”



Fined nearly $7 million by the NASD for brokerage violations.



Named “Best Corporate/Institutional Internet Bank in the U.S.” by Global Finance magazine.

2004

Creates new Global Correspondent Banking group.



Acquires Houston-based bank First Community Capital.



Ranks number one in Watchfire GómezPro’s Q4 Online Banker Scorecard.



Sells Consumer Auto Receivables business to CompuCredit.

Forms Eastdil Secured through acquisition of Secured Capital and subsequent merger with Eastdil Realty.

The Inside Scoop



Announces plans to acquire Reilly Mortgage.

New hires trying to get acclimated may find the company’s size a bit intimidating.



Announces plan to acquire Commerce Funding Corporation, a privately held factoring company based in Virginia.

INSIDER SCOOP

Ranks 17th on DiversityInc.’s list of the “Top 50 Companies for Diversity.”

We Are Family

2006

The Firms

Announced it will no longer make subprime mortgages through its brokers as a result of escalating late payments and defaults.

2005

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Acquires most of the assets under management and funds of Strong Financial, becoming one of the biggest mutual fund managers around in the

W E T F E E T I N SIDER GUIDE

Size Matters

“It’s a large company, so it’s easy to feel lost and daunted.”

Employees report a high degree of camaraderie inside their departments. An insider says, “There’s a lot of interaction, and everyone is more than willing to help out even if they are extremely busy.” Not only are people accommodating, but they are friendly, too. “People say ‘good morning’ and

smile,” an employee says. “We have potlucks and baby showers.” In 2007, Wells Fargo garnered a top-20 showing on the Diversity Inc. “Top 50 Companies for Diversity” listing. WF also placed on the Working Mother Top 100. Around two-thirds of its employees are female, and the firm has stated it’s committed to meeting the needs of working mothers with telecommuting and flexible hours. Wells also supports more than 80 affinity groups, touching everyone from African Americans and Latinos to employees who are gay, lesbian, bisexual, or transgender.

In private client services offices, insiders say the dress code is relaxed—business casual or simply casual attire. “I wear jeans,” an insider says. In the Internet Services group, an intern says dotcom perks haven’t gone the way of Pets.com. There’s reportedly a pool table, air hockey, free food and drinks, and flexible work hours.

Getting Hired

Midcareer Candidates Midcareer candidates can apply through Wells Fargo’s job website at www.wfjobs.com, which outlines current positions available in each division and functional department.

Recruiting Contacts If you cannot participate in a recruiting event, you can apply for any of Wells Fargo’s professional development training programs through the website at www.wellsfargo.com/jobs. WETFEET INSIDER GUIDE

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Entry-level job seekers stampede to Wells Fargo, in part because of its highly regarded training programs for undergraduate and graduate hires. These programs involve multiple phases of classroom training and in many cases offer rotations through various divisions of the company. Recent acquisitions have boosted opportunities in the college arena and increased both rotation and placement opportunities. Undergraduate and graduate recruiting starts in September. In the past, the bank has recruited on campus at select schools in the western and central U.S., with most hires placed in California locations. Targeted schools include Arizona State, Iowa State, Texas A&M, University of California (Berkeley, Davis, and Los Angeles campuses), University of Minnesota, University of Southern California, and University of Texas–Austin. Recruiters for the training programs say that they’re looking for candidates who have a finance background and related work experience.

the industry

Loosen Up

Undergraduates and MBAs Undergraduates may apply for entry-level programs in the following areas: audit, business banking support, U.S. corporate commercial banking, customer service, investment management, finance, Internet services, real estate, capital markets, wholesale banking, and technology. The bank also offers summer internships to undergrads in audit, Internet services, specialized financial services—capital markets, real estate, U.S. corporate and commercial banking, technology, and wholesale services. MBAs come on board in corporate/wholesale banking (which has a six-month training program), Internet services (a one-year training program), home and consumer finance, and human resources. The interview process for corporate/wholesale banking consists of a first interview on campus or over the phone, followed by two sets of interviews at the Wells Fargo office. The process for Internet services, home and consumer finance, and HR consists of two rounds of interviews. Summer internships in these areas are also available for MBA candidates. Wells Fargo also has a growing investment banking division, Wells Fargo Securities, which is hiring on an as-needed basis. See the company’s website for open positions. Interns give high marks to Wells Fargo for providing a challenging variety of projects and a lot of responsibility. “You may feel overwhelmed, but managers are encouraging and make sure that the experience is worthwhile,” says an intern.

25 Top Financial Services Firms

WETFEET INSIDER GUIDES series

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Ace Your Case - Consulting Interviews Ace Your Case® I: Consulting Interviews, 3rd ed. Ace Your Case® II: Mastering the Case Interview Ace Your Case® III: Market-Sizing Questions Ace Your Case® IV: Business Operations Questions Ace Your Case® V: Business Strategy Questions Interviewing Ace Your Interview! Beat the Street® I: Investment Banking Interviews Beat the Street® II: I-Banking Interview Practice Guide The Wharton MBA Case Interview Study Guide: Volume I The Wharton MBA Case Interview Study Guide: Volume II Resumes & Cover Letters Killer Consulting Resumes Killer Cover Letters & Resumes Killer Investment Banking Resumes Job Hunting Getting Your Ideal Internship The International MBA Student’s Guide to the U.S. Job Search Job Hunting A to Z: Landing the Job You Want Job Hunting in New York City Job Hunting in San Francisco Financial Services Careers 25 Top Financial Services Firms Careers in Accounting Careers in Asset Management and Retail Brokerage Careers in Investment Banking Careers in Venture Capital

The Firms

Financial Services Companies Deutsche Bank Goldman Sachs Group JPMorgan Chase & Co. Merrill Lynch & Co. Morgan Stanley UBS AG

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Consulting Careers 25 Top Consulting Firms Careers in Management Consulting Careers in Specialized Consulting: Information Technology Consulting for PhDs, Lawyers, and Doctors Consulting Companies Accenture Bain & Company Booz Allen Hamilton Boston Consulting Group Deloitte Consulting McKinsey & Company Career Management Be Your Own Boss Changing Course, Changing Careers Finding the Right Career Path Negotiating Your Salary and Perks Networking Works! Industries and Careers: General Industries and Careers for Engineers Industries and Careers for MBAs Industries and Careers for Undergraduates Million-Dollar Careers Industries and Careers: Specific Careers in Advertising and Public Relations Careers in Pharmaceuticals Careers in Brand Management Careers in Consumer Products Careers in Entertainment and Sports Careers in Health Care Careers in Human Resources Careers in Information Technology Careers in Marketing Careers in Nonprofits and Government Agencies Careers in Real Estate Careers in Retail Careers in Sales Careers in Supply Chain Management