Finanace: Old boy network? Forget it. Best get a first

Times change. The cream of financial jobs now goes to high-flyers with languages, writes Paul Gosling

Despite the consolidation of some of the major investment banks, large numbers of graduates are being recruited, at attractive salaries. Even NatWest Markets and Barclays Capital, which are withdrawing from some of their investment banking activities, still have graduate recruitment programmes.

Vivien Dykstra, head of graduate recruitment at Deutsche Morgan Grenfell, advises graduates to test the water before making a commitment. "To seek an internship at the end of their first or second year at university would be a good way of checking it is what they want to do," she says. "An A1 academic record is usually a pre-requisite for entry. A second language is helpful - the more unusual the better. Eastern Bloc languages are good for emerging markets.

"A lot of graduates these days have postgraduate degrees, often a master's; some come with an MBA, especially those from US Ivy League institutions. It is not especially important to have a master's, but for graduates with a history degree or something it is useful to have a degree in a financial discipline. But interest and motivation are the key. They must prove that they have not just applied on a whim."

For the major investment banks, recruitment is increasingly international. "We recruit on a Europe-wide basis without country quotas," says John Porter, an associate in Morgan Stanley's investment banking division. "British graduates will be competing against Italians and French, who will have business specialisms in their degrees." The days of Oxbridge students dominating City entry are over - Morgan Stanley now recruits more from other universities - but respected international business universities such as Insead in Paris produce some of the most sought-after graduates.

Recruitment is not restricted to recent graduates. "People can enter at the beginning of their career, through graduate recruitment programmes, but some people will join later in their lives after they have done a PhD, or after developing a specialism or working in consulting or asset management," says Franck Petitgas, a managing director in Morgan Stanley's investment banking division. "There is no specific recruitment programme for postgraduates, but you are likely to find a lot of PhDs in areas such as derivatives, trading and asset management."

Choosing the right degree may not be essential for a career in investment banking, but it definitely helps, says Peter Newton, managing director of Parallel International, employment brokers that specialise in the sector. "Computer science graduates and maths graduates can go for IT posts, and linguists make good technologists. You need a useful, numerate degree. Someone going into mergers and acquisitions needs a decent degree, a numerate master's or a PhD. People should think about doing a master's in a numerate or specialist subject - there is a useful degree in securities finance at Reading University, for example.

"It is much less of an old boys' network than it used to be. It is a meritocracy, but it is not easy. They need to be very bright, not just academically qualified, but capable of applying common sense. They need an ability to get on with people from different cultures, bearing in mind that there are more people from a range of cultures employed in the City now."

Carole Divani, senior business manager for Reed Banking Personnel, says that banks look for a first or an upper second class degree from one of the better universities. It is preferable to have studied a financial discipline, but not essential, if enthusiasm and aptitude are there. "Graduate training schemes are common, and many involve placements within a large number of departments within a relatively short period of time," she explains. "These give the graduate a good overview of the organisation before specialising in any one area of work."

Mike Tiley, senior careers adviser at the London School of Economics, says graduates should think carefully about what aspects of investment banking most attract them. "It is a broad area," he says. "It depends on temperament. People who like to see quick results should go to a trading desk. People with a more long-term outlook might go to corporate finance or fund management. Operations, the back office and research are somewhere in between. Some graduates lump all these things together and don't differentiate. They need to match their temperament to a suitable job, and make the most of their interests."

Graduates should even seriously consider whether investment banking is what they really want to do, suggests Mr Tiley. "Too many graduates are thinking about the lots of money they will earn, but have no good reason to go for it. They should have a relevant interest first. There is a bit of peer pressure. Some don't realise the hours involved, or the hard work. I would advise them perhaps to talk to a former alumnus for advice before they apply."