Given potential for more M&A activity under the new administration and Congress, investment banks that thread AI tools into their workflows can scale their capacity for deals.
Specifically, the right AI tools will enable junior bankers to streamline and complete their core activities materially faster. They can apply the reclaimed time toward additional pitches or client-management tasks for senior bankers. Mundane, repetitive tasks will also feel more manageable throughout the intense initial years of their careers. AI tools can also strengthen banks’ value propositions for recruiting the next classes.
The Challenges Facing Junior Bankers
As is well known, junior bankers typically spend much of their first year learning the intricacies of their firm's technology and processes. The steep learning curve, combined with the demanding nature of their roles, involves long hours and grueling work weeks. There are high expectations for accuracy, attention to detail, reliability, communication, and collaboration.
AI tools can assist junior bankers with many of their core responsibilities, including:
-
Financial modeling and analysis: Junior bankers are heavily involved in building models to evaluate the financial implications of mergers, acquisitions, and other transactions. They analyze historical financial statements and project future financial performance.
-
Research and information gathering: They conduct market research to gather relevant data about industries, companies, and economic conditions. This research helps in understanding market trends and identifying potential investment opportunities.
-
Preparation of pitch books and presentations: Junior bankers assist in creating detailed presentations and pitch books that senior bankers use to pitch ideas to potential clients. These documents typically include market analysis, transaction recommendations, and valuation metrics. There is a significant amount of copying, pasting, and formatting content from multiple sources.
-
Due diligence activities: They support the due diligence process by gathering and reviewing data on potential investment targets, ensuring all necessary information is available for senior management to make informed decisions.
-
Coordination and communication: Junior bankers coordinate with various teams, both internal and external, to ensure all aspects of a deal are moving forward. They communicate with legal, compliance, and other advisory teams to support deal execution.
-
Administrative and logistical support: They handle administrative tasks such as scheduling meetings, organizing travel for site visits, or other logistical tasks that support the senior bankers in their daily operations.
AI Benefits and Solutions for Investment Banking Workflows
The implementation of AI enables firms to fundamentally reimagine how junior banker work is done and gain real benefits such as:
-
Increased efficiency: Automating routine tasks can significantly reduce the time spent on administrative work, allowing for more deals to be processed with the same resources.
-
Improved accuracy: AI-powered tools can minimize human errors in data acquisition, entry, and calculations. That leads to more reliable financial models and analyses that junior bankers can back up with source links.
-
Enhanced client service: With more time available, junior bankers can focus on understanding client needs and developing tailored solutions, improving overall client satisfaction.
-
Accelerated professional development: Junior bankers can engage in more meaningful work earlier in their careers, fast-tracking their learning and development and preparing for revenue-generating work at the firm.
-
Better work-life balance: By reducing the time spent on tedious tasks, AI can help alleviate the notorious long hours associated with junior banking roles, potentially improving employee retention.
One AI solution in the investment banking space is FactSet's Pitch Creator package. Our suite of GenAI-powered capabilities is specifically designed to enhance pitchbook building efficiency. For example, estimating that large investment banks generate up to 100,000 market data charts annually and each junior banker spends 30 - 45 minutes daily refreshing files, the value proposition of Pitch Creator is substantial.
FactSet Pitch Creator has the capacity to reduce hours of manual work into minutes, creating the productivity gains necessary for junior bankers to prioritize high-impact strategic initiatives that drive new business opportunities.
Pitch Creator offers a range of features that address the pain points of junior bankers and their senior-banker supervisors.
Global Assistant is integrated directly into Microsoft Office to enable research and information discovery during modeling and pitchbook creation.
In Chart Creator, junior bankers type natural language prompts to generate up to 90% of the charts required for a sell-side pitch book. It allows for automatic application of firm-specific style requirements, and outputs can be downloaded as an ActiveGraph or Excel chart. (ActiveGraph allows you to graph FactSet data and your own Excel data in MS Office applications, and the graphs are easily refreshed with the latest market data.)
Cloud Refresh allows for bulk uploading of multiple files to the cloud, automatically updating them with the newest data. It works for Excel files and linked PowerPoint presentations, saving hours of manual updates.
Template Assistant enables users to prompt and discover pre-built templates linked to FactSet codes, streamlining the template selection process.
Junior bankers can use Slide Assistant to build branded company profile slides by entering a ticker and selecting up to four content elements.
The Tombstone Generator Premier application creates branded tombstone slides by scraping M&A deals from websites, eliminating the need to manually create text boxes and copy/paste logos.
The innovative ReSlide feature refreshes existing slides for new presentations or target companies, pulling data from FactSet or company websites to update content, including executive biographies and photos.
As the investment banking landscape continues to evolve, embracing AI-powered solutions like FactSet's Pitch Creator will be crucial for firms looking to maintain a competitive edge. By empowering junior bankers with these cutting-edge tools, investment banks can increase productivity and efficiency but also foster a more engaging and rewarding work environment for their new talent.
Post Comment
