Experience Report: « How to win over a Sales-Apprenticeship offer »

One of our ESSEC Transac’ members is sharing his experience as a Sales Apprentice at Société Générale!

Internship: 12-month apprenticeship split into 6 months/6 months.

Background: ASTi Grande Ecole, from Morocco, previous internship experience: Internship in asset management

How did you find the job offer? What was the application process like?

The offer was on ESSEC’s jobteaser website. I applied by sending an e-mail with my resume and cover letter. There was a first phone interview to make sure I spoke French perfectly (it’s a sales desk where you are supposed to interact with French clients…) and quick fit questions, I was then invited to another interview.

How did you prepare for the interviews?

I have done a previous internship in asset management on a fixed income desk, so it helped to answer technical questions even though they always pushed the questions further until I ran out of steam. I only prepared for fit questions as I thought that the interview won’t be technical which was a mistake.

The interview started with a brief presentation of the desk’s missions and the team. Usually they send one cool guy at first to meet you, a casual conversation takes place and you get asked easy but tricky technical questions about fixed income along the way. If you do well with that first guy, he’ll go back to the desk, return a positive message to two other senior sales people and they will conduct a harder round. Here, you get asked about your previous internships, and if it was in finance, they want you to explain in a very concrete manner what your contribution was. Again, as sales people, they always get down to practical things, they don’t care about the model you studied and the code you wrote, they only care about whether you really understand what you did and how useful it was for your team. Candidates who come from a technical background, like myself at the time, get pretty disturbed here, as they generally tend to explain their work through the theory, while it’s only the practice that matters for them. So the interview went as a mix of fit, news and technical based questions. Some of them were:

– Why do you want to work on a sales desk.

– You come from a technical background, why don’t you go into trading?

– What’s a swap. What is it used for?

– What’s a bond? How do you price it? What happens to the price of the bond if interest rates rise? Why (beware of answers like: because in the formula the discount rate is in the denominator, typically the kind of answer that drives salespeople mad…)?

– What’s EURIBOR?

– What’s QE? What is it for? What’s the current 10-year rate in France? U.S? Germany?

How did a day in your internship look like?

There were never two similar days in my whole apprenticeship. Of course there are some routine tasks you get to do because you are the junior of the team (like for instance, sending daily mails to the clients containing the bank’s axes, i.e, the securities (in our case those were bonds) which Société Générale could offer at an aggressive price). It is quiet special when you work on a trading floor with a front office team who is willing to let you do the real job, i.e : trading with the clients. The job as a sales person or a trader is like no other because you rarely work in a project mode, you don’t come to your desk in the morning and finish yesterday’s slides, you come to the desk and wait for your clients to call, and believe me, there are days like during the summer or around Christmas where no one calls, so you basically have nothing to do apart from cleaning up your mailbox or your desk ^^. But let’s get back to the time when there is stuff to do. Sales are there to cover clients, in our case, those were institutional clients i.e banks and insurers. It is known that for the case of a bank for instance that it borrows for short time periods but lends for longer time periods, that creates an exposure to the interest rate curve because your asset and your liabilities have different maturities. Without getting much into the details, banks cannot be exposed to that risk and they hedge using interest rate swaps. So, if we want to simplify, as a salesperson, your job consists of understanding your clients’ needs and constraints (very much driven by regulations, Basel III for banks and Solvency II for insurers), and be able to respond to their price requests, and to suggest new trade ideas etc. Back to the interest rate swap example, an ALM manager of a bank would call to ask for the price of an interest rate swap, and you are expected to know it within 30 seconds, and if you don’t, one of the other 3 banks he has called as well (to create competition and reduce margins that banks take) will win the deal. Part of my job, was to answer to client requests, and it is the most exciting part and the most stressful, because you have to understand what the client wants, price it (using the banks internal systems for pricing), call the trader to have his margin and to cross-check your price, and then get back to your client. The senior sales person in my team wanted to recruit juniors to do this job so they could take care of structured deals, which take more time and obviously generates more money than the flow deals.

At the end of the experience you’ll:

– Understand how fixed income instruments work and what they are used for: Bonds, Swaps, Futures, Forwards, Caps, Floors, Swaptions etc.

– Understand how trading at a bank is done and how the bank manages its different risk exposures: market risk, counterparty risk, etc. *

– Understand and explore the different jobs: Structuring, Trading, Risk Management, as the interactions with them are very frequent.

What was the biggest challenge during your internship? What did you like the most?

The biggest challenge, I guess, was to get the seniors to trust me. And this happens by showing them day in and day out that you are a reliable team member who understands what he is doing.

I liked working with senior people as they tend to delegate more easily and are very knowledgeable about what’s happening around. The atmosphere on the trading floor was quite a thing and I was pretty happy being seated sometimes next to people who had every cliché depicted personalities you would see in a finance movies.

Do you have any recommendations for people who are aiming for an internship as an international student in France or for an internship in Asset Management?

If you want to work on a sales desk, you have to speak perfect French. If you don’t, there will always be a place for you in a more technical job where you don’t interact much with clients like in structuring, some trading desks and risk management, middle office, etc.