10 Best Degrees for Banking What to study for a career as a banker

Banking is one of the most lucrative jobs in the United States today. Thousands of bankers make over six figures a year and serve as some of the most powerful business leaders in their communities. According to the Bureau of Labor Statistics, the average wage for financial managers is one of the highest in the country and is just behind judges and dentists. Entire cities such as Dallas and Charlotte are economically powered by their banking sectors. The road to a career in banking begins in college with the declaration of a major. Picking the right major can make the process of starting a banking career much easier than it otherwise might be.

1. Business

Business is one of the most closely connected majors to banking. Bankers need a knowledge of the business world and the way that business is conducted in order to do their jobs. They have to be able to evaluate the financial worthiness of companies and the trajectories that different businesses are on. This information is essential to determining whether or not companies that a bank lends to will fulfill their obligations and then hopefully become repeat customers.

A bank is also a business in itself. It has revenue, expenses, liabilities, and capital costs. There are employees who have to be paid and vendors who must be managed properly. A business degree can help a bank employee deal with all of these concepts. This degree involves a range of classes that deal with nearly every aspect of business. Students perform case studies in which they see how banks succeeded or failed in the past. They learn how to read a balance sheet and a profit-loss statement. They are able to spot red flags that may show a company is reckless with their money or may otherwise be unable to pay back their debts to the bank.

Bank employees with business degrees may be located either at a branch or at a central office. They may be focused on outside companies or deal entirely with the operations of the bank. Employees with business degrees may be able to move up in a bank and eventually become the manager of a branch. No matter the location, this degree can help a new employee shine as soon as they step into an interviewer’s office.

2. Finance

Banks use a wide variety of financial instruments in this day and age. They are not simply holding funds and giving out mortgages and small-business loans like in the past. Increasingly, banks are becoming sophisticated financial organizations that have large investment and business funding divisions. As a result, individuals who work for banks need to be more aware of these instruments and how they work alongside each other.

A finance degree is essential for showing a bank that an individual has picked up these skills. Finance degrees show a familiarity with stocks, bonds, mutual funds, and wide variety of other investment vehicles. They show an understanding of how numbers work and a grasp of complex mathematical formulas and equations. Even the most simple earnings and expense ratios may be overwhelming to someone who is not familiar with their operations. In many instances, students with finance degrees also have internships that give them a familiarity with investment professionals and the financial world. These internships can be essential it securing a job at a higher level at a bank. Anyone with a finance degree who wants to work for a bank should emphasize their skills and how they can market those skills to the public.

3. Sales

Banking is a finance and business-related job that involves dealing with numbers and calculating risk. However, banking is also essentially a sales job. There are many officials at banks whose primary job is to sell different financial products to customers. Sales professionals who work in banking have to have a friendly affect and a skill at selling the sometimes complicated products that a bank offers.

Sales are essential to fostering new relationships and communicating products to customers in an effective way. A need to boost sales has helped dictate the structure of the business. The desire for sales is a major reason why face-to-face operations are so important in the banking sphere. Some banks have endorsed and embraced online approaches in the past ten years. But many potential customers still prefer the traditional meeting with a banking employee. The desire to show stability and foster trust is a major reason why even the newest banks are built in a monumental style.

This importance of sales is shown in the desire by many banks to hire a number of employees with sales degrees. A sales degree is basically a degree in cultivating personal relationships and turning those personal relationships into contracts for different products and services. In some cases, users can put more money in a bank than they will put in any other venture in their entire lives.

Unlike other products, a business or individual may come to a bank for a loan ten or twenty times throughout their lifetime. This tendency is multiplied greatly with banks that have investment arms. Customers may put their entire life savings into an investment vehicle that pays massive dividends to the bank. It is imperative that at least some of the employees at a bank have sales skills. The best way to pick up those skills early on is through securing a sales degree.

4. Accounting

Banking is one of the more particular fields in the business world today. Banks sometimes have to keep track of thousands or even millions of different transactions on a regular basis. They have to deal with disclosure requirements, dozens of types of spreadsheets, and complex financial instruments that are connected to multiple areas of the business. An accounting major can be helpful in sorting out all of these different connections and making numbers work within a bank.

Accounting and banking have most of their connections off of the teller floor and in the back offices of the bank. But they are also essential parts of banking and are necessary to the operation. A robust accounting department is essential for any bank that wants to stay in compliance with all relevant rules and laws. Anyone with an accounting degree has a future at multiple levels and different positions in a bank. In addition to actually being an accountant, the skills an accountant cultivates through rigorous training and careful study are all enormously helpful for doing the jobs that banks require out of their employees.

5. Management

Management is a skill that is often lacking at banks and other financial institutions. These institutions focus practically all of their time and effort on financial transactions, economics, and sales. But first and foremost, a bank is a business that is using capital and labor in order to make money. Many banks forget the labor portion of the system and put little time into picking effective managers and executives. As a result, banks can sometimes be understaffed and suffer high rates of turnover which can greatly harm a customer-focused business like a bank.

A management degree can be helpful in overcoming these issues. Management classes focus on psychology and quickly gaining a rudimentary understanding of nearly any field. A management degree will often require a student to take a wide variety of finance and business courses to give them basic experience in running a business. They are also often a combination of in-person work and internships or practicums that are directly located within companies.

These classes help train a student on how to interact with employees, retain hires, and get the most out of a managed team. They can reduce turnover and identify and retain talented employees. At a certain point, promotions in a bank consist solely of gaining an employee higher and higher management roles. Management training can help a new employee move up as far through the ranks of a bank as possible.

6. Information technology

Banking is becoming a technological business as much as a financial one. Practically all banking that is not done between two human beings is done through computers and sophisticated technology on multiple levels. This technology involves complex software and concepts such as user interfaces, security, and user accessibility. Banks have websites that they manipulate, software that they have to test and compare with one another, and new programs that they have to try out that can help them make decisions or better invest the money of their clients.

Having a degree in information technology can put a person in a comfortable place when it comes to this technology. It can turn technology into an asset instead of a liability like it is for so many bankers that are only focused on old-fashioned financial concepts. Banks have entire information technology departments and IT experts who travel around to multiple locations fixing computers.

Every bank customer has had a day where they walked into their bank and could not access their information because they were waiting on someone from IT to fix a technical problem. Bank employees with information technology experience can also be brought in to help with accessibility and social media marketing. These skills are often handled outside of a company and are expensive burdens since they are performed by private contractors. Bank employees who can complete these tasks can prove themselves incredibly valuable in our current technology-driven world.

These jobs are always in demand and particularly so in a field like banking. Specializing in banking related software is helpful to securing an IT job at a bank or another financial institution. But simply having familiarity with internet connections, firewalls, and secure software can be enormously helpful in getting any banking related job.

7. Financial engineering

Banks, like all other financial institutions, have become reliant on a complex set of financial instruments being offered to the public and other institutions. These instruments often rely on leveraging positions and investing in derivatives on different products and at different levels. While banks typically focus outwardly on savings accounts, checking accounts, and mortgages, they are making more and more of their money every year from financial instruments. Derivatives and mortgage-backed securities allow them to leverage holdings and make significantly larger profits. These activities are limited for typical customer funds but not for the investment holdings that companies and individuals hand over to the largest banks.

Financial engineering is the major that fits these operations the closest. At its heart, financial engineering involves the manipulation of computer programs and financial math in order to create, manage, and make money off of these financial instruments. Financial engineers have to take several classes in fields such as computer science, statistics, and economics.

They have to be able to code and run programs that will determine the best financial strategies. Then, they have to keep up with these strategies and change them in accordance with new information and approaches. Finally, the financial engineer has to be successful over a long period of time. Unsuccessful engineers may cost the company millions of dollars over a long period of time.

8. Economics

Economics is at the heart of the banking field and is one of the most important majors that a prospective banking employee could have. The principles of supply and demand, inflation, scarcity, and risk are handled by bankers daily. They have to be familiar with overall economic trends so they can know the potential chances of success for companies looking to borrow money.

Bank employees need to understand how inflation will affect the number of people saving money and potential future changes in interest rates. They need to be familiar with the operations of cyclical and counter-cyclical businesses and how those operations factor into their own risk assessments. Finally, they need to know both macroeconomics and microeconomics if they hope to make money over an extended period of time.

Prospective bank employees with economics degrees need to focus on both theory and practice. They should take time to understand large social forces as well as small behaviors that may influence economic decisions. They should also put their economics knowledge to use at an internship or a part-time job. This information will help show that they are adept at both learning about economics and putting it to use out int he business world.

9. Business administration

Business administration is essential to banking for two major reasons. First, it is helpful to aid with the bank’s operations. Banks have to determine where to put their money and how to determine the viability of different companies. When a company attempts to borrow money from a bank, they have to send in their current or prospective balance sheets and the future administration of their business. Much of this information is applicable to the field of business administration.

There is also the need for administrators for the business functions of a bank. Banks are complex businesses that have a wide variety of intricate moving parts. Business administrators can help banks curb their expenses, handle employees, and keep technology and materials in working order. They can be a vital part of a bank’s business even if they do not interact with customers. Business administrators need to have a firm understanding of economics, finance, accounting, and relationships with the public.

10. Law

Law is a major part of banking that no banker wants to discuss on a regular basis. It is often a concept that is passed on to the legal department and not given a second thought. But the law is intertwined with banking in a fundamental way. Especially over the past 20 years, banks have worked closely with law enforcement to stop different plots and make sure that banks are not being used for nefarious ends. The role of banks as a depository for money has made them especially vulnerable to illegal activities. Every banking company has a large array of lawyers who are trained to spot wire fraud, tax evasion, and money laundering.

Banks can be fined tens of millions of dollars if they are shown to have contributed to a significant criminal enterprise. There will always be a place in banks for people who have at least some legal training or who are generally familiar with the law. Legal training can help bankers spot different problems before they get out of hand. It can also allow an employee to propose changes in procedure that will be more productive while also fulfilling legal obligations. A degree in law can help a banker put themselves above the rest of the competition and find their own place in a banking organization in this day and age.

Conclusion

Any student looking to go into the field of banking needs to evaluate their interests and what motivates them. They need to determine what career in banking they think they would enjoy the most. They may be a sociable individual, talented with computers, or have an understanding of large strings of numbers throughout a company. Once a student picks what path they need to be on, they must identify what job in banking they want and who they need to make connections with in order to secure that job. Any of these ten majors can be helpful in beginning this process to securing a top-level banking job.

Related Articles:

10 Best Degrees for Wealth Management
10 Best Degrees for Hedge Fund Managers
Top 10 Best Degrees