Technology career opportunities in finance

The UK may have a successful computer games industry, but someone with good IT skills and education is much more likely to end up working for a bank or an insurer.

The scale is huge; the average bank spends 7-10% of their non-interest expense on IT systems. This translates into big IT teams and big individual projects. HSBC has been reported as spending £2.5 billion a year on its information technology and it was reported that in 2009 it employed 25,000 people in IT. When Deutsche Bank took over Germany’s Postbank, it announced it would be spending €1 billion a year on building a joint retail banking infrastructure. These are big IT operations with big teams.

IT career opportunities in financial services can mean anything from help desk work (helping other staff to overcome any IT glitches they have) to building and programming gigantic computer grids and super computers. In general a department is organised in two. One section runs Operations, keeping the day-to-day systems up and running. The other side is Development, where new systems are developed, or bought in from the outside and integrated into the bank’s current framework.

IT departments vary dramatically between different types of companies. The big retail banks and insurers have massive IT departments and still rely on mainframe computing (or equivalent scale networks of smaller systems) to manage the huge amounts of data and transaction information they generate each day. There are enormous IT career opportunities in finance both for the technically gifted and for those people interested in planning and management.

Investment banks tend to have smaller teams. However, you can be working at the very cutting edge of technology – a nanosecond’s difference in response times can be enough to gain a huge advantage over the competition, and some investment banks are even moving into the world of quantum physics in order to get their electronic trades done quicker than their rivals.

Where can I go?

If we were to generalise, we could say there are two major paths for IT careers in financial services companies. First, the technical route that culminates in your effectively becoming a ‘guru’, and secondly a business/management route. Both are equally valid, and can lead to the very highest rewards.

Technical guru
The key here is to continually develop your technical skills.

Permanent IT jobs in banking and finance pay well. The average IT job advertised in the trade press with the magic word ‘banking’ in it now reaches £60,000 a year (though at one time this was £65,000). People who develop systems for traders can often earn into the hundreds of thousands. A very select few can even manage to get themselves into the trader’s bonus scheme and can earn those legendary megabucks!

For IT people, it is always worth keeping an eye on your value by looking at sites like ITJobsWatch – it gives you a good idea of how much you can earn. Specialist trade press, such as Computer Weekly or Computing, can also be used to gauge the likely value you could command once you have developed your technical and industry sector skills. You can do this by looking at the day rates which contractors get.

If you are a C# (one of the current batch of computer languages used) developer, the average rate you can command can be approaching £500. However, in the City of London, and if you have some specific knowledge of programming for a specific market (say fixed income trading or derivatives), you can be looking at even more. Very specific skills can command up to £1,000 per day. It is often risky to specialise in something obscure, but daily rates of £450-750 are certainly possible in the City.

Project management, then the management team
This is the other route to the top money. Many people, including lots of bankers and insurers with experience of project work, go into IT project management.

Some projects are small, others are large, but they all require good management of IT staff (who usually have long hair and would like to wear sandals to work – and are always late with everything they do) and good management of the business people who are actually paying for the project (who can never understand why everything takes so long and always want to shout at the IT guys).

Project management is stressful, but it is well rewarded, and teaches people to manage the most complex of business challenges. Because the projects in banking and insurance tend to be so big and so business-critical, managing them tends to pay even better than elsewhere.

Also, while many other IT jobs, such as basic software development, have gone abroad, many banks will keep their project teams close to their main users in the UK.

Project management will put you on the path towards management of the entire IT function. IT directors of financial services companies – now usually called something like the ‘Chief Information Officer’ – can earn large amounts of money, much more than in most other industries.

IT qualifications and career progression

If you go down the technical route, STAY UP-TO-DATE. Get re-qualified in new software packages and languages as often as is practical. In practice, this won’t be all that often, since you also need actual experience of using a system. So, you need to make the right choices, since you will be stuck with what you have learned for a long time.

If you go down the management route (and this applies to many developers as well), LEARN WHAT YOUR INDUSTRY DOES. Systems analysts, business analysts and project managers all need to understand how banking and insurance processes work. Indeed, people in IT often know more about the business than the people using their systems!

There are plenty of formal qualifications, but often it is the commercial courses in new languages or project management techniques that really sell. Basically, it all comes down to keeping an eye on the trade press, seeing what pays the best, and getting trained in it.

IT graduate employers

All the big banks have careers website, and these often have specific IT related sections – some are very impressive. One which is quite interesting is JP Morgan, as it shows lots of examples of the type of work that you can do in the IT department of a bank – some is really rather high tech. All the big British and European banks and insurers have similar careers sites and all recruit in the UK, as it is the global capital of banking.

The Barclays Technology Future Leaders Development Programme gives candidates comprehensive IT training in various areas of the business. Deutsche Bank’s Global Analyst Training Programme affords graduates the opportunity to work in the Group Technology & Operations division, which makes up 25% of all employment at Germany’s biggest bank.

But as with all graduate jobs in banking, competition is fierce, so make sure you possess the right set of skills for the industry.

If you can commit to the continuous professional development required for an IT career in finance, the rewards are substantial.

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The ifs School of Finance is a not-for-profit professional body and charity incorporated by Royal Charter and is the only specialist provider of professional financial education that is able to award its own taught degrees. It has a remit to provide the financial services industry with a skilled and competent workforce while also promoting a better understanding of finance amongst consumers. Learn more about the organisation.

About the Author

  • About Anthony Gandy: Anthony Gandy is a Reader, Postgraduate Programmes at the ifs School of Finance.

Anthony Gandy

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