Though it has been over a decade since the global financial crisis of 2008, investment banking and the financial services industry still aren’t the same. Overall, the percentage of MBAs interested in a career in finance has made a slight recovery, but the products/services and tech industries still lure more and more grads. According to the most recent 2018 Alumni Perspectives Survey Report by the Graduate Management Admission Council, the percentage of alumni from two-year, full-time MBA programs working in the finance/accounting industry dropped was 16 percent in 2018, compared to 11 percent in 2017. Products/services and technology maintained the lead at 19 percent each. Government/nonprofit (12 percent) surpassed consulting (10 percent) as the fourth most popular choice of 2018 graduates. At the top schools, however, consulting has remained a top contender for a career path as about 30 percent of MBA graduates choose it.
Still, finance is an interesting, lucrative career path for MBA graduates. The work can be widely varied, giving quants ample opportunity to engage their analytical expertise. Not only that, the average graduate earns more than $115,000 in her first year based on the latest U.S. News & World Report. And beyond the money and the work itself, there’s also considerable prestige in working for top firms, which include Goldman Sachs, Morgan Stanley, JP Morgan/Chase, Bank of America, Merrill Lynch, Deutsche Bank, and Blackstone, among others.
We get it. For many, finance presents a dynamic, rewarding career path that can also serve as a jumping off point for many future opportunities, including starting your own firm. For those of you with this route in mind, we’ve gathered together a list of business schools best positioned to help you earn a job in the finance industry.
Latest School Placements & Earnings
There are multiple ranking systems that examine top MBA programs for finance. The Financial Times, for example, segments out its own list—Top MBAs for Finance—as part of its annual global ranking of top MBA programs. For 2018, the ranking placed Stanford Graduate School of Business (GSB) in the #1 slot, with alumni from that school three years out from graduation earning an average salary of $252,000. Stanford is not only the top school for earnings, but also sent the most graduates into the field of top-tier programs. Stanford GSB sent 38 percent of its 2017 graduates into finance, only matched by NYU / Stern (ranked 5) and Cornell Johnson (ranked 18).
For the purposes of this article, we’re going to review the schools that send the greatest percentage of their students into finance and, particularly, investment banking. Typically, this statistic indicates that more of the school’s resources will be allocated toward preparing graduates for success in the field, both in terms of faculty and coursework and in terms of career services, including cultivating relationships with industry employers and bringing in top recruiters to snap up those students.
These Schools Send More of Their MBA Grads into Investment Banking
Five schools lead the pack in terms of percentage of graduates in the Class of 2018 heading into finance and, particularly, investment banking. While 31 percent of Stanford GSB’s Class of 2018 went into finance, only 2 percent took on investment banking roles. Two of the top five—Columbia Business School and NYU Stern School of Business—are located in New York City, one of the world’s greatest financial hubs. Two more—the University of Pennsylvania’s Wharton School and the University of Chicago Business School—are known as quant-focused finance powerhouses. Cornell’s S.C. Johnson Graduate School of Management has also begun to establish a solid foothold in the investment banking space.
Here’s what portion of grads these top schools send into finance, at a glance:
- Columbia Business School—32.2 percent (12.3 percent investment banking/brokerage)
- University of Chicago Booth School of Business—31.6 percent (10.5 percent investment banking/brokerage)
- New York University Stern School of Business—33.8 percent (26.2 percent investment banking/brokerage)
- University of Pennsylvania’s Wharton School—36.9 percent (13 percent investment banking/brokerage)
- Cornell’s Johnson Graduate School of Management—32 percent (19 percent investment banking/brokerage)
The percentage of 2018 graduates heading into finance has only increased at the Wharton School over the Class of 2017. At Columbia, the 33.6 percent taking jobs in consulting narrowly outpaced the 32.2 percent heading into finance. At the other four schools, financial services drew more grads than consulting—the second most common industry destination. At NYU Stern, 33.8 percent went into financial services, as compared to just 28.4 percent heading into consulting. At Chicago Booth, it was 31.6 percent financial services, followed by 31 percent consulting. At Wharton, the stats were 36.9 percent financial services, trailed by 25 percent consulting. And finally, at Johnson, 32 percent of Class of 2018 grads headed into jobs in financial services, as compared to 25 percent going into consulting.
What Those Newly Minted MBAs Get Paid
Next, let’s take a look at salaries. Graduates heading into financial services. Columbia Business School reported a median salary in finance of $134,718 overall, and $125,000 in investment banking. Wharton followed at a median of $130,000 starting salaries in finance, and $125,000 in investment banking. The average salary out of Cornell / Johnson increased slightly to $128,254 compared to last year in finance, and $137,738 was the average for those going into investment banking. Booth and NYU / Stern noted that the average salary for graduates entering finance was $125,000, and also the same for investment banking. In every case, an average signing bonus of approximately $40,000 to $50,000 was de rigueur.
A Closer Look at the Finance Faculty
While the endgame—where graduates land jobs—is understandably on everyone’s mind, we’d like to posit that who students learn from and what they learn is equally as important a consideration in where to attend business school. In this next section we’ll take a closer look at the finance faculty and related coursework at each of these leading finance schools.
Faculty and Coursework at Columbia
The advantages of a New York City location are also reflected in CBS’s faculty and coursework. The Finance division and Economics division together account for more than half of all classes and counting approximately 50 faculty members, including adjunct and visiting professors. As at Stern, their backgrounds represent a powerful mix of theory and practice. In addition, many of its finance courses involve visits from industry professionals, allowing students to gain a better understanding of how their course material applies to the real world. Among CBS’s star professors is Joseph Stiglitz, former senior vice president of development economics and chief economist of the World Bank, who won the Nobel Prize in Economics in 2001 for the analysis of markets with asymmetric information.
Also of potential interest to aspiring bankers, the CBS core includes a half-term course called “Global Economic Environment.” Taken during the spring semester, it examines the way a company’s performance and management may be influenced by external factors across an entire economy, drawing on current events to illustrate the practical implications of the concepts covered.
CBS’s Program for Financial Studies also offers suggested electives for students pursuing careers in investment banking and corporate banking. These include “Financial Statement Analysis and Valuation,” which covers how firms communicate with one another through financial statements and involves analyses of publicly traded companies; “Debt Markets,” which provides a comprehensive survey of the five major debt markets and their derivative dependencies, and “Advanced International Corporate Finance,” which explores varied decision-making situations regarding international capital budgeting.
There is also a Value Investing area of focus available to CBS students, administered by the Heilbrunn Center for Graham & Dodd Investing. Designed to teach students to find value that the market might not see and make profitable investments accordingly, this focus area includes courses ranging from “Security Analysis,” which teaches students to make investment decisions by analyzing business models and financial statements, to “Distressed Value Investing,” which covers the opportunities of investing in companies in bankruptcy.
Finally, second-year MBA students at CBS also can participate in project-based electives called Master Classes, in which they analyze the problems of a partner organization and make a recommendation on the issue at hand, and several involve projects related to investment banking.