eFinancialCareers

Definition and Trends
If you work in the information technology (IT) department of an investment bank, you’ll be responsible for the web of technology that underpins any large modern financial organization. Firms use computers for just about everything: communicating with staff, storing information on clients, and running complex computer models to price and trade financial products. They are known for having some of the world’s cutting-edge computer systems, especially for their trading floors, where financial products and commodities are bought and sold electronically.

IT spending has risen slowly in recent years because of an increase in cost. In pursuit of lower costs, growing numbers of banking IT jobs are being outsourced to low cost locations such as India and China. Plenty of banks have offshore activities already. JPMorgan, for example, has an outsourcing agreement with Wipro Technologies, an Indian IT vendor, which developed an operational risk management system for the bank. Deutsche Bank operates an Indian subsidiary, Deutsche Network Technologies.

Deloitte Research, a division of the accounting firm, forecasts that by the end of 2005, financial services organizations worldwide will shift billions of dollars of their cost base to India for a substantial annual savings. Does this mean fewer IT jobs in investment banks in the U.S.? The answer is, undoubtedly, yes. As many as 3,000 IT jobs at Wachovia may migrate to India, for example, while ABN Amro is reportedly cutting 5,000 European technology jobs.

The good news is that banks will still need plenty of people in western financial centers to liaise with overseas employees. According to technology research company Forrester Research, there will be no shortage of future demand for business analysts and project managers who understand the banking business and can manage the outsourced functions.

Roles and Career Paths
Jobs in IT departments of investment banks tend to fall into one of four categories: development, business analysis, project management, and technical support.

If you become a developer, you may be responsible for writing the computer programs that help the bank do everything from pricing and booking trades to calculating risk. The programming languages used by banks are usually C++, Java and Microsoft’s .NET (dot net).

While developers write the programs, business analysts look at the way technology is used in the bank and analyze the opportunities for making it work better. A trader might complain about the length of time it takes his computer to execute a trade, so it’s up to an analyst to investigate whether the complaint is valid. If it is, a new computer might be needed, or some of the programming code might need to be changed by the developers.

Business analysts help identify the potential for making changes to a bank’s technology systems. Once big changes are underway, the responsibility for managing them often passes to another set of IT staff: the project managers. Project managers plan, structure and fulfil IT projects. If IT development work is outsourced to third party providers, project managers liaise with providers to ensure the work is completed correctly and within the right time frame.

Technical support staff require razor-sharp technical skills and the thickest skin of all to handle not only the technology problems but the frustration of irate traders as well. It’s a role that carries a lot of responsibility: a computer problem on a trading floor lasting a few minutes could cost millions of dollars. It’s up to technical support staff to identify and resolve the glitch as soon as possible.

Generally, IT staff in investment banks specialize in a particular business area. While many IT staff work on the trading floor, others are based in private banking, fund management, operations, or deal with core infrastructure requirements.

Skills and Qualities