why is there such widespread public finance slander?
I'm looking at both generalist ib and public finance summer analyst roles for summer 2025, and was curious why the latter gets so much hate. To my understanding, you get to work on deals that directly impact and ideally improve the lives of many. Is the public finance slander just due to the fact that the pay is less and there aren't many exit opportunities? If one was considering between a public finance SA 2025 role at Wells Fargo/Raymond James/Stifel/Piper Sandler vs a generalist IB role at SMBC/HSBC, which one would you go for?
Take the IBD role, you can always switch to pub finance if you don't like IBD, but not sure if you can lateral the other way around
yes, lower pay
Former pubfin
Awful pay vs corporate (like, 50% of what corporate IB gets, at the junior levels)
Hours better but not by much
Extremely niche skillset
Takeaway: unless you know you’re in pubfin for life and you’d marry her yesterday, the risk/reward of that over corporate isn’t there. However, if it’s your ONLY option it’s still a front office job on Wall Street and you can always lateral as an analyst
Can I PM? No worries if you are really busy!
Sorry prefer to keep here. What’s up
What would be the easiest corporate groups to lateral into in your opinion? Any advice on how long before it’s possible / the general process?
The federal government is gay, and municipal governments are their adopted gay sons
Work in Public Finance and the sector is a double-edged sword depending on what you cover and where you work. Some seats are very comparable to other IB groups (from both an experience and comp standpoint), while others are very far removed from traditional IB (not necessarily a bad thing).
Firms
BBs vs MMs/Boutiques have very different strategies and feels depending on where you work. As in traditional banking, the BBs generally get to work on the largest, most complex deals. Examples may include a $1b+ GO issuance, a $500m revenue bond deal linked with derivative products, or a $250m high-yield project financing. Within a BB you may have 5 - 20 bankers focused on just one sector area of coverage (Higher Education, Transportation, West Region, etc.). At the junior levels (and depending on what you cover at the senior level) compensation is generally in line with IB or Markets comp depending on the bank, sector focus, and individual performance. While not BBs, I would also include RBC and Jefferies with this group.
On the other end of the spectrum, the smaller shops generally are more regional focused, (i.e. RJ in the SE, Hilltop in TX) and some are more sector focused (i.e. Cain in Healthcare). Those teams focused on regions act as sector generalists and instead offer regional expertise (i.e. Tax + State/Local expertise in CA). Culture/strategy is very shop dependent, but is a much different feel than a BB in general. The deal sizes and complexity are often much lower than at BBs. The only exception is certain, "hairy" deals fall to MMs/Boutiques that BBs don't want to touch (i.e. Jake's 58 Casino by KeyBanc) often due to reputational risk. In general comp at these shops will be much lower than the BBs/Street.
Wells and RJ honestly fall a bit in between the BBs and MMs/Boutiques in this case
Sector / Coverage
Aside from what type of firm someone is at, what area within PubFin one covers drives their skillset development and long-term compensation profile. Generally, those in NFP Healthcare and P3/Infra/HY groups have the highest compensation ceiling and grow a skillset akin to corporate IB teams. For example, Goldman, RBC, and the Jefferies (ex-Citi) teams are quite active in the HC advisory space (i.e. GS did Kiser/Risant/Geisinger). In the P3 world a couple good examples include MS and Brightline, Jefferies doing PIPEs for their clients, GS and Hybar Steel, and Barclays as buyside and Citi as sellside on PR's Toll Road Monetization.
There are those in non HC or P3 focused groups that still develop skillsets more akin to traditional IB. Those in Power may do Gas Pre-Pays and cover corporate clients such as BP, Marathon, etc. Those in Higher Ed may do Student Housing, Stadium, and even acquisition deals (i.e. Citi with the Idaho and Phoenix deal).
Lastly, that is not to say those who are removed from the complex work have worse jobs or skillsets. Yes, the compensation ceiling and fee pool is lower, but you can still develop strong capital markets, macro, and public policy skills that you cannot develop in many other jobs. You will not go to a reputable PE shop coming from traditional Muni world, but there is still lots of optionality to switch roles on the sellside (IB, ER, S&T). The combination of pay (MDs and Ds at BBs are still clearing $500k+), WLB improvements, and sector/region coverage are very attractive to many people.
All of this is to say that in general the PubFin space is a good spot to be in the scheme of life, but outside of seats at BBs in NFP HC or the P3 world, you generally won't develop a similar skillset to banking or have the same compensation ceiling. If you want to maximize your opportunities in your career then in general you'll be better off working in a more traditional IB role, but if you do some self reflection you may realize a Muni seat in some capacity is the right choice for you do to your interests or desired WLB.
Thanks for the quality information. Are you happy in pubfin? What would you say to a student interested in the field who is pretty sure its for them; be wary or go for it?
I've worked at two different BBs now and for the most part people seem to enjoy it (as much as you can for work at least). Generally, people are nicer, work less hours, and are more laid back than their traditional IB counterparts, which makes for a pretty good work environment. At the BBs junior comp is pretty good (at least from what I've seen) and a much higher % seem to stay A2A than other IB sectors (this is a good thing, although some is due to more limited exit ops on the buyside). Hours are fairly predictable and are much better than average (analysts probably work 60 - 70 hours on average, everyone else probably 50 - 65 depending on seniority).
The best deals are as interesting as deals in any other sector (Puerto Rico's Restructuring, rebuilding the WTC after 9/11, Stadium financings, landmark NFP HC & Education M&A, complex P3s , etc.), but unless you are passionate about the sector you cover the deals can be a bit rinse and repeat (excluding advisory work, project finance, and high yield).
Doing Muni / PubFin work off that bat will not be the limiting factor in your career, it is pretty easy to move to another IB gig as long as you are coming from a legit shop. Skillset wise, you will develop a similar skillset to your peers in IB, except your modeling chops will be weaker (unless in an advisory heavy role, i.e. HC or P3, or you handle complex Project Financings, Securitizations, etc.). Personally, I view modeling skills to be very useful in the early stage of ones career, but it losses value quickly after the A&A years (also no sane person wants to be a model monkey their whole career).
This is a great spot to be if you're 1) want to be in banking for the LT, 2) are interested in the space, or 3) want a good mix of WLB and Comp before switching to Grad School or a more laid back job (i.e. FP&A, Corp Strat, etc.).
Do many people exit into government/public policy roles? That's what I'm hoping to do.
It's not very common, but it's definitely attainable. For example, the State of California's Deputy Treasurer is a former public finance investment banker, and so is the Treasurer for the MBTA transit system in Boston (the "T").
As of 2024.
Haven't seen a ton of people do it, but I'd guess its more for $ reasons than qualification reasons. In the last year, the two most notable departures off the top of my head are a Director at JPM became the Director of Capital Markets at Yale and a senior NFP HC guy at Citi became the CFO at Ochsner Health.
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