Corporate Finance
Typical finance jobs within the general corporate sector include:
| Treasurer |
A treasurer is head of the treasury department of a company. This department manages cash, raises funds, developes financial plans, and acquires and disposes ofassets for the company. The job of treasurer is an upper management position. |
| Financial Analyst |
Financial analysts do many things. For example they analyze capital budget projects, do long-range financial planning, put together budgets, analyze competitors and examine possible acquisitions and asset sales. As you can see, this position calls for a broad knowledge of finance. Many undergraduates in the field of finance start out as Financial Analysts. |
| Credit Manager |
Credit managers set the policies for granting credit to suppliers. They set the rules for granting customers credit and implementing the rules. This is another area that employs recent finance graduates. |
| Cash Manager |
Cash managers make sure that the firm has the cash that it needs on hand. In other words, they make sure that the firm's checks do not bounce. They also invest excess cash, deal with international funds transfer, and manage the short-term credit needs of the firm. Good negotiating skills are also required since they will also deal with the cash managers of other firms and with a variety of financial institutions. |
| Benefits Officer |
Benefits officers, amoung other activities, manage pension plans, set up 401(k) plans, and determine health care plan coverage and policies. They should have a good background in finance as well as human resources since their objective ia to create and manage an attractive benefits plans in the more economical way. |
| Real Estate Officer |
Real estate officer’ find real estate locations for a firm and then negotiate the lease or the purchase of the property. The position calls for negotiating skills, knowledge of property valuation, and financing skills. |
| Investor Relations Officer |
The Investor Relations Office is the firm's link with the firm's investors. This office issues press releases about the firm and provides information to the firm's investors and potential investors. |
| Controller |
The controller is at the center of the firm's financial activities with the firm's "numbers" flowing through its office. The controller does financial planning, cost analysis, and maintains the books for the firm. The position calls for a high level of accounting knowledge and experience as well as the ability to deal with the rest of the firm. |
Many of the corporate finance jobs involve solving problems using a combination of intuition and analytical skills. Corporate finance is a good area of people who enjoy problem solving.
Most entry-level positions in the corporate finance area require "crunching numbers" and putting simple presentations together. This calls for an understanding of spreadsheets, word processors and presentation packages.
Intermediate positions in the corporate finance area involves long-run financial planning and implementing those plans. It also involves areas such as risk management and dealing with fluctuations in the value of money.
The finance group is the bridge between the investment community and the shop floor. In a day and age when institutional investors are increasingly active, it is crucial that managers get the message that their job is to create shareholder value. The job of the finance group is to make sure that happens.
The typical entry-level position for the finance professional in a non-financial firm is Junior Financial Analyst. The starting pay for a Financial Analyst with an undergraduate degree is between $23,000 and $31,000 depending upon the size of the firm and the person's experience; the starting pay with an MBA is between $30,000 and $70,000.
Commercial Banking
Typical jobs within the commercial banking industry include:
| Credit Analyst |
This is a typical starting point for someone going into the commercial banking field. Credit analysts evaluate loan applications from businesses by projecting the company's’ future cash flow and evaluating its business plan. The position calls for a good knowledge of accounting and the ability to communicate well. |
| Loan Officer |
Loan officers deal directly with business and individuals who are attempting to borrow money from a bank. It is a position that calls for selling ability, knowledge of the banking industry, and also a good knowledge of business in general. |
| Branch Manager |
A branch manager runs a branch office of the bank. Managers are responsible for opening new accounts, loan origination, solving customer problems, foreign exchange, and maintaining good customer relations. |
| Trust Officer |
A trust officer deals with the bank's trust clients, wealthier customers who because of large accounts or the payment of fees are provided estate planning and management, investment management, and any other financial service that the bank might provide. |
| Mortgage Banker |
Mortgage banker’ make mortgage loans to businesses and homebuyers for the bank. As part of the job, they deal with real estate professionals and make background credit checks. |
Success in banking calls for a good understanding of how a business is run. People skills are also important since the decisions made by bankers can have a significant effect on the future of businessess and the life-styles of individuals.
In general, an MBA is not required by banks for a position, but for the higher position in a bank it does become important.
With more and more people are doing their banking from home, strong computer skills can enhance someone's potential in banking.
A typical entry-level job would have a title of Trainee/Credit Analyst with a starting salary between $22,000 and $32,000. The starting salary for someone with an MBA is between $28,000 and $40,000.
As the way people use banks change, job characteristics in the banking industry are also changing. Branches, for example, have become less important as more people use ATM machines or bank from home. Providing specialized services and money management have become more important.
Some typical jobs within the insurance industry are:
| Actuary |
An actuary carefully analyses the risk assoicated with the risk that the firm is attempting to insure. The success of the firm to a large extent rides on the actuary's ability to balance the need to set insurance rates high enough to cover the firm's expected payouts yet low enough to attract customers. The job requires a high level of mathematical ability. |
| Agent and Broker |
Agents and brokers advise people on what kind of insurance they need for their circumstances. They sell consumers their insurance contracts, and they are the first people called after a fire, accident or injury. |
| Claims Adjuster |
A claims adjuster determines the amount that the insurance company will pay against a claim. |
| Service Representative |
The service representative is the insurance company representative who deals with the independent insurance agents. This is a job that calls for a good people skills as well as an in-depth knowledge of the products of the insurance company. |
| Loss Control Specialist |
A loss control specialist advises the clients of the insurance company how they can keep their accidents and losses to a minimum. A loss control specialist must be knowledgable in engineering and safety management. |
| Risk Manager |
A risk manager trys to control losses for the insurance company by reinsuring the risks that the company has agreed to assume. |
| Underwriter |
Underwriters decide whether the firm will insure a particular risk. They also will determine the amount of risk that the firm will take, and what premiums they will charge to cover this risk. |
Insurance companies assume the risk of their customers by writing policies that transfers the risk to themselves. The insured is willing to pay a periodic premium to avoid the possibility of large payout if the risk actually materializes. Almost any risk can be insured: life, health, property are typical examples. Most insurance companies offer a wide range of insurance, other specialize. There are even firms that insure the risk taken on by the insurance companies. More and more of the insurance industry is being handled through banks (32% of all annuities were sold through banks). People expect their banks to sell them a variety of financial services.
Insurce is a growing field. The Bureau of Labor Statistics is expecting the growth of the insurance field to be between 20% and 40% over the next 15 years. The industry is selling more creative policies, and with the growth of our economy, people have more things to insure.
Investment Banking
The career areas in investment banking include:
| Mergers and Acquisitions |
In recent years the mergers and acquisitions area has become the most profitable area for the investment banking industry. Investment bankers work with firms involved in a merger or an acquisition. They will bring the two firms together, advise them how to structure and make the merger possible and feasible, and then raise the capital needed to do the deal. The area calls for people with good analytic and negotiation skills, the ability to structure deals and contracts, and the willingness to deal with the a great deal of stress. |
| Trading |
The trading department of an investment bank values, buys, and sells stocks, bonds, currencies, options, and futures contracts to other investment banks, commercial banks and institutional investors. Those who work in this area must understanding how markets work, what drives the markets, and be able to communicate effectively with those they deal with. |
| Structured Finance |
Financial engineering has become a new buzz work on Wall Street. The Structured Finance area is one response to the needs for firm for additional funds. They create (or, if you would like, engineer) securities backed by assets such as credit cards, automobile loans, and mortgages. This is an area that calls for a good knowledge of finance, financial markets, and finance law. |
| Derivatives |
Investment banks are also involved in the derivatives market. This market for securities that are based on other securities (options and futures contracts) continues to grow. Jobs in this area call for high-level analytical ability. |
| Equity and Fixed Income Research |
This area provides research for the rest of the bank. Security analysts will specialize in particular industries, and will frequently know more about the industry than people in the industry. They make buy and sell recommendations to the bank and to the customers of the bank on what investments to buy or sell. |
| International Sales/Emerging Markets |
As firms have become more involved in international markets, investment banks have responded by increasing their presence in the international finance area. People working in this area provide the services of the bank to firms in these emerging markets. |
| Public Finance |
The market for municipal bonds is very large and the market needs analysts, advisors and traders. This field is hard to get into, but is projected to grow. Public financing is one way to answer how a city or county can build buildings or arenas. |
| Retail Brokerage (Stockbroker) |
Individual investors deal with investment bankers through their retail brokerage operation. Dealing with the general public calls for good communiation skills as the people in this field attempt to see stock, bonds, insurance, and other financial products. |
| Ratings Analyst |
In this area investment banks evaluate bonds of all types. They try to predict the likelihood of the bond meeting its payment schedule. |
Investment banking calls for high motivation and a willingness to take risks. The hours are long, and being "stressed to the max" is the norm, but the payoff in terms of both pay and a sense of accomplishment can be very high.
The entry position in the field of investment banking is usually that of analyst. This position calls for an ability to work with spreadsheets, a good understanding of financial statements and what they mean, and a willingness to travel and work very long hours. The next level up involves dealing with customers and requires good communication skills as well as a good knowledge of business. A strong background in mathematics can be a real asset in this field.
| Real Estate Agent/Broker |
Real estate agents and brokers bring together the buyers and sellers of real estate. They are usually individual salesmen who receive an agreed upon commission upon the sale the property. |
| Real Estate Appraiser |
An appraiser attempts to determine the potential selling price of an asset. |
| Property Manager |
Property managers manage property on an day-to-day basis for the owner of the property. |
| Real Estate Advisor |
Predicting the future cash flows from an investment in real estate calls for a very specialized knowledge of the real estate market and the economy in general. Institutional investors call upon Real Estate Advisors to help them profitably invest in the real estate market. |
| Development and Construction Management |
Managing a construction project--managing the work force, scheduleing the job, keeping within a budget--is the task of a development and/or construction manager. This job calls for a background in engineering and significant people management skills. |
| Real Estate Entrepreneur |
A real estate entrepreneur buys properties with the expectation that they will increase significantly in value. This activity calls for a willingness to take on risk and access to a substantial pool of capital. |
Real estate is the nation’s number one busines.
The real estate business offers a wide variety of career choices. It is attractive to entrepreneurial types as well as the white-collar types. Some careers place an emphasis on people-skills, others on analytic skills. Technology is changing the real estate business. One example is in the sales area where videos and sites on the World Wide Web are changing the way property is sold.