For those looking for a career in investment banking, it helps to know where investment banks are looking for employees. So where do investment banks recruit? As it happens, the search field for the major investment banks such as Goldman Sachs Group Inc. (NYSE: GS) is relatively narrow; approximately 60-80% of university graduates are drawn from a list of "target schools" where investment banks concentrate most of their recruiting efforts in terms of regularly showing up on campus and offering multiple interview and summer internship opportunities to undergrads. Attending one of the top target schools makes getting an interview with multiple investment banks a fairly simple process, while students at other, non-target schools may find it difficult to line up even one or two interviews, and have to put forth considerably more effort to land those interviews.

The Field of Investment Banking

It is generally well known that investment banking is one of the hardest career fields to break into. This is partially because investment banking involves, along with exciting merger and acquisition (M&A) deals, exceptionally high salaries and bonuses, which makes an investment banking career attractive and one where there is a lot of competition for the available entry slots each year. Also, investment banking is a relatively small niche within the overall financial services sector. There are simply not that many jobs available in the field as opposed to, for example, the field of accounting, or closer to home, that of retail banking. Attending a school that is an established source for employees of investment banks is, therefore, a key advantage.

University of Pennsylvania

The University of Pennsylvania, home to the famed Wharton School of Business, is the number one feeder school for the investment banking industry. However, the recruiting statistics for the overall number one university reveal an important point about investment bank recruiting, which is that each investment bank has its own individual list of preferred schools. The University of Pennsylvania is the number one school for Goldman Sachs, Citigroup Inc. (NYSE: C), Barclays Capital (NYSE: BCS), Morgan Stanley (NYSE: MS), the Blackstone Group LP (NYSE: BX) and others, but is not even among the top 10 schools for Credit Suisse Group AG (NYSE: CS) or UBS Group AG (NYSE: UBS).

New York University

New York University (NYU) runs a close overall second to the University of Pennsylvania on the list of schools where investment banks most frequently recruit new employees. NYU is actually on the top 10 schools list of more investment banks than the University of Pennsylvania but was edged out of the overall number one spot by virtue of the University of Pennsylvania being the single number-one recruiting school for the largest number of banks. NYU tied with Pennsylvania for the highest number of interviews by Nomura Holdings Inc. (NYSE: NMR), and NYU students were the number one picks for investment banking positions at JPMorgan Chase & Company (NYSE: JPM) and UBS.

University of Michigan - Ann Arbor

The University of Michigan at Ann Arbor occupies the number three position. It is the leading feeder school for boutique investment banking firm Evercore Partners Inc. (NYSE: EVR), as well as for French firm BNP Paribas S.A. (OTC: BNPQY) and KeyBanc Capital Markets Inc. The University of Michigan also made the top 10 schools list of 14 of the major investment banking firms.

Other Top 20 Schools

The Ivy League dominates the next several spots of the list of overall top 10 target schools, with Harvard University, Cornell University, Princeton University and Boston University. Rounding out the top 10 are Canada's University of Toronto, Columbia University and the University of Texas at Austin. Other schools in the top 20 include Villanova University; the University of Virginia; the University of Maryland, the number one school for HSBC Holdings plc (NYSE: HSBC); Georgetown University; and another Canadian school, Queens University.

For individuals aiming to get on with a certain bank, it is important to keep in mind each bank has its own preferred recruiting sources. For example, Bank of America Merrill Lynch (NYSE: BAC) grants more interviews to students at the University of North Carolina and at Vanderbilt University than it does to students at Harvard.

The Importance of Internships

Nearly all the major investment banks offer summer internship analyst programs that last approximately 12 weeks. Students who can land one of these internships not only gain valuable experience but also have the opportunity to develop networking relationships at the bank that can give them a substantial advantage when it comes to final hiring decisions.