Defining corporate and institutional banking is a little tricky.
On the one hand, corporate and institutional banking is much the same as to say, business banking – it is simply about meeting the banking needs of corporates and institutions.
But who are these corporates and institutions? And why aren’t they served by business banks or even investment banks?
Unlike business banking, corporate and institutional banking focuses on the ‘big end of town’ – these are not your small ‘mum and dad’ setups, these are larger corporates, typically publicly listed though not always, as well as institutions such as government departments. They are big – have a higher turnover and profit than smaller businesses, and, as a result, also have more complex needs.
Regular business banking is about finding the right ‘off-the-shelf’ business banking product for the customer. Corporate and institutional banking is about working with the customer to develop a bespoke banking solution. This could include anything from debt structuring and funding solutions to funds management, and trading and research services. However, corporate and institutional banking, which focuses on financial processes (such as mergers and acquisitions), is different from investment banking, which focuses on raising capital.
Note, the distinction between corporate and institutional banking can be blurred. Traditional commercial banks may offer some investment banking services, while many investment banks have commercial banking services.
At the heart of corporate and institutional banking is relationship management, that is, being able to really understand your customers and how to help them. Over time, you will eventually manage your own clients.
As a graduate, you will get into the details of what a client’s business does by analysing financial information, making recommendations and helping to implement them. It’s a great way to develop your business acumen and really understand what makes businesses tick. You may monitor the markets and prepare industry reviews for any potential risks. You will be expected to report on your findings and communicate this to the rest of your team and eventually the clients themselves. This is an excellent opportunity to develop your communication skills.
Starting a career in corporate and institutional banking provides you with a solid foundation – you will develop your knowledge of markets and industries, hone your technical skills and gain customer experience.
Within a commercial bank, corporate and institutional banking is highly regarded. It is often considered easier to transfer from corporate and institutional banking to other areas of a retail bank than vice versa. You may choose to move to areas such as product or marketing or service other clients, for example, in business banking.
If you begin corporate and institutional banking in an investment bank, there may be scope for you to move to other areas of the bank. However, it should be noted, moving earlier in your career is easier than later as other investment banking divisions develop different skills. Working at an investment bank and gaining exposure to other areas of the bank is highly regarded and it may be easier to gain later experience in private equity or venture capital.
You may be required to complete certain accreditations depending on the area you specialise in, for example, the AFMA Core Accreditation or the Omega Lending Program.
Choose this if you have: