Many business schools felt the need to revamp their finance courses in light of the financial crisis. One such school is Imperial College, which recently received a £20 million donation from Brevan Howard, the world's third-largest hedge fund, to build a new financial centre on campus.
For Professor James Sefton, who will head two new finance Master’s programs at the school, the courses had to be redesigned. “An awful lot happened [during the crisis] and of course they needed to be updated to take that into account,” he said. “Graduates need to learn from our past mistakes.”
Imperial claimed a big scalp earlier this year when two financial experts, Professor Franklin Allen and Professor Douglas Gale, agreed to leave top US universities to head Imperial's new Brevan Howard Centre for Financial Analysis.
At the same time, they announced plans for a new MSc in Investment & Wealth Management and an MSc in Finance & Accounting.
Many others have followed suite, particularly European schools, which have been setting up such programs in droves.
In December SDA Bocconi School of Management, the leading Italian business school, revealed plans for their own master in finance, a collaboration with US-based Fordham University. It is a change from SDA Bocconi's previous Italian offering. Students will spend six weeks in New York, and Fordham’s American professors will fly to Europe to deliver content first-hand.
A band of SDA Bocconi graduates enter the US banking scene each year, but the school envisages closer ties with leading employers. They already have links with UBS, Goldman Sachs and JPMorgan.
“Students are going to have a different teaching methodology,” said Professor Lucilla Tealdi, who heads the current Corporate Finance Master. “They will be exposed to American companies and Italian companies working in New York. For them, it will be a transformational experience.”
Prof Lucilla said about 20 students signed up for the new program’s summer test-run. These alumni already work in big banks and financial firms. “We never thought that we would have so much success,” she added.
But elsewhere, the numbers are more depressing. According to the Graduate Management Admissions Council, 53% of schools surveyed last year reported a drop in applications for master of finance programs. In the previous four years, all schools reported an increase.
This is despite the overall rise of specialized master programs, which have posed a threat to the traditional MBA degree. According to GMAC data, over five years 20% of business school candidates ditched the MBA and opted solely for a master program.
There is more bad news. The annual GMAC corporate recruiters’ survey, which polled 900 business school employers, shows that master of finance graduates are losing their lustre among recruiters. In Europe, only 42% plan to hire such graduates, compared with 49% in 2012.
But some institutions, such as Cass Business School in London, report insatiable demand for master’s courses. Of all the 1,300 students enrolled in Cass masters programs, 1,000 are taking finance modules.
Dr Sophia Taylor from Nottingham University Business School said they have seen an increase in applications for the school’s MSc in Finance and Investment.
A new master in banking and finance has “had very healthy recruitment”, Dr Sophia added. She envisages students going into investment banking or consultancy roles.
Imperial, who expect to take 80 students into a new wealth management course next year, have seen a “phenomenal demand” in applications, said Prof James.
As investment banks have faced reputational challenges, a feast of opportunities has risen in other areas, such as hedge funds and private equity.
Dirk Holshausen from CDC Group, a leading private equity firm which specializes in emerging markets, said its “teams are growing”. The firm, whose portfolio of investments is valued at £2.25 billion, recently returned to direct investing, while maintaining its fund of funds capability.
“Many of my colleagues have MBAs from top business schools around the world, and cover roles ranging from microfinance to direct debt and equity investing, to managing our fund of funds team,” added Dirk.
The need to adapt to changing times has helped these specialist courses gain traction with students – and recruiters. Dr Sophia said that 86% of last year’s class, who were looking for jobs, were employed within three months of graduating.
Asset management is a big area for master of finance graduates, too, agrees Prof James. “We look at hedge funds, bonds, private equity strategy and as well as looking at the big asset allocation questions.”
But he added that money management is getting more competitive.
With so many specialist courses being launched, students are now spoilt for choice. There are also opportunities to take advantage of distance-based learning, which has received rave reviews from most schools. US-based Northeastern University’s Online Master of Science in Finance, and Georgetown University's online MS in Finance program, are considered among the best.
Prospective students are also turning to other professional examinations, such as those which lead to a qualification as a charter financial analyst.
But the CFA Institute, which administers the exams, said registrations fell slightly last year to about 210,000 – although are up from about 170,000 at the height of the crisis in 2008.
Dr Sophia said many of Nottingham’s pre-experience master’s students go on to complete CFA exams. “That gives students an additional grounding. Students are always attracted [to CFA exams],” she added.
Some European schools are in a jubilant mood. This week, new Financial Times rankings revealed that master of finance programs delivered in Europe are considered better quality than those across the Atlantic.
HEC Paris, of France, topped the pre-experience list. Oxford’s Said Business School is the highest-ranked UK institution, while MIT: Sloan tops the US set.
Professor Martin Binks, Dean of Nottingham University Business School, which is in the top-50, said that rankings become more competitive every year.
Jacques Olivier, director of HEC Paris’ MSc in International Finance, said the program is also becoming more diverse – 80% of its student body is from outside of France.
More than a third of the 4,000 pre-experience graduates surveyed by the FT said they also had one or more professional qualification.
For those in today’s finance industry, then, there is a wealth of choice available when it comes to qualifications.
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