RJ and Makay

Business schools saw an increase in recruiting for MBAs this fall on behalf of banks and brokerages. The industry is optimistic about the economy improving, and hiring managers in financial services are sweetening offers in order to lure MBA candidates, believing that need for qualified candidates will be increasing. According to a recent study done by the Graduate Management Admission Council, the average newly minted MBA recipient can expect an annual base salary of almost $89,200 this year, 3.2% more than MBAs who graduated in 2009.

Wharton reported that 20% more students were offered summer banking internships in 2010 than in 2009. At New York University’s Stern School of Business, which places about 30% of its students at investment banks, 10% more bank recruiting events for full time positions and summer internships took place this fall. Also, there are one-third more full time investment banking jobs posted on the Stern job board compared to a year ago. Columbia Business School, which places almost 50% of its students in financial services, saw an increase in recruiters visiting its campus this fall, and experienced a 45% jump in full-time job postings.  Regina Resnick, assistant dean and director of the career management center there, said, “The backlog of candidates from the past couple of years had been erased.”  Harvard Business School also expects a deluge of offer letters for MBA candidates as graduation approaches.

U.S. Rep. Spencer Bachus (R., Ala.) was nominated by a 34-member committee of senior House Republicans to chair the House Financial Services Committee. Rep. Ed Royce (R. Calif) had also been in the running, but Bachus has been the top Republican serving on the panel for the past four years and has been the favorite to take over the committee from current Chairman Barney Frank (D., Mass) when Republicans assume control of the House in January. He still must be approved by the wider conference on Wednesday, December 8, but GOP leadership aides say the party’s lawmakers have always endorsed a committee chair recommended by a steering committee.

Bachus has been an advocate of capping taxpayer exposure to Fannie Mae and Freddie Mac, and would like to see the two agencies either placed into liquidation or be forced to compete in the private market. According to aides working for Bachus, he plans to conduct strict oversight of the Obama administration during the implementation of the financial regulatory law mandates. During the process of passing the financial services reforms, Bachus was initially out of favor with Republicans in 2008 because he seemed to be supporting the financial services bail-out without first clearing his position with party leaders, but later, he was instrumental in effectively preventing the Democrats from concluding work on the bill too quickly.

The financial services industry has fallen behind in the race to reach customers through social media sites, such as Twitter and LinkedIn.  This is largely due to industry regulations and brokerage company rules. The U.S. Securities Exchange Commission, for example, says all broker stock recommendations must be “suitable” for individual clients by measure their risk tolerance, security holdings, income, net worth and investment objectives. This rule is generally broken by tweeting a stock pick or posting it on Facebook, per David Sobel, executive VP and compliance officer at Abel/Noser Corp., a firm that helps clients cut trading costs, and does permit its employees to network through LinkedIn.

Firms like Merrill Lynch & Co and TD Ameritrade have restrictions on all broker-to-investor interaction on social media site due to concerns about violating SEC or Financial Industry Regulatory Authority (FINRA) rules. Those who break the rules face possible fines or suspensions for communicating in a potentially misleading manner, FINRA says. Almost 5,000 brokerages are overseen by FINRA, which requires firms to supervise and store all broker-client exchanges, like emails, twitter posts and Facebook updates. The firms also must pass approval on most postings to Web sites.