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Careers in finance: the action is back on main street.

The late Reginald Lewis was the greatest African-American corporate takeover artist in history. In 1987, he bought the food company he renamed TLC Beatrice International (still the world's largest Black-owned company), by pulling together a billion dollars in financing.

But in 1967, Lewis, while still a student at Harvard Law School, worked a summer internship at a Baltimore law firm, A partner there was so certain the young man was a superstar-in-the-making that instead of recruiting Lewis into the small local firm, he steered the potential catch out into bigger waters.

"I took him into our library and told him, |You are so extraordinary, you should go to the big leagues of law and finance,"' Mathias DeVito today admits. "I said, |You should go to New York. You'll make it and you'll make it big.' "

Sure enough, when Lewis pulled off the largest offshore leveraged buyout in American history, his equity investment firm was located at 99 Wall Street. Later, Lewis's friend, New York Mayor David Dinkins, would remark, "Little dreams stay home; big dreams go to New York."

That may no longer be the case, however, for African-American professionals who want work in the finance industry.

Wall Street

For a time, finance was the ultimate glamour career, and New York's financial district--Wall Street--with its buttoned-down, Brooks Brothers-clad, horn-rimmed armies, was the place to hammer out one's fortune.

When the municipal bond business opened up for African Americans in the 1970s and '80s, large numbers of students shot headlong through master's of business administration programs at the nation's universities, and on to jobs selling or trading securities.

For the African Americans who hold nearly six percent of the industry's jobs, these are still among the most lucrative positions you can enter without working on a stage or a playing field. According to the Securities Industry Association, for instance, experienced stockbrokers who handle individual clients earn an average of $98,000 a year (although the average beginner earns about $30,000). Those who handle the accounts of large institutions earn an average of $238,000.

But the October 1987 plunge in the stock market slammed on the brakes for many securities hopefuls.

According to the Bureau of Labor Statistics, back then there were 150,000 workers in New York City's securities business alone. Within three years, that number had been pruned by a full third. And the director of operations for the National Black MBA Association warns that the industry still hasn't bounced back.

"I don't think Wall Street will come back until (the economy of) America comes back," says the NBMBAA's Antoinette Malveaux. "And that's not on the near horizon."

African-American professionals interviewed by THE BLACK COLLEGIAN don't foresee many openings right now in Wall Street fields like municipal or corporate finance, stock and bond sales and trading, or investment and merchant banking.

Main Street

Today, most available finance jobs are in Main Street kinds of careers. For instance, Malveaux advises finance aspirants, particularly those with little related job experience, to consider working in other areas at small to midsize companies.

Treasuries at companies need people who can manage cash and who can direct funds to projects. Financial administration departments need folks to prepare reports for regulatory agencies or officers within the corporation.

In the third quarter of 1993, one out of ten companies surveyed by Robert Hall International, a personnel firm based in Menlo Park, California, expected to hire more accountants, tax consultants, credit collectors, and controllers. The companies included retail stores and financial services, insurance, and real estate firms.

Malveaux also encourages young people to start their own businesses. "It may be a financially harder row to hoe in the beginning, but it provides more opportunity to amass wealth over the long term." She says accountants "with the entrepreneur begging in their souls" can open one-person enterprises. Other kinds of professionals may be able to drum up business:

* preparing income taxes

* setting up and managing investment portfolios

* establishing insurance programs for small companies

* and setting up accounting and financial systems for companies

"You'll need to have enough money saved to support yourself for two years. After that, you should have a good core base of clients to build a business."

Twenty-five years ago, Harold Doley Jr. went into the brokerage business for himself, founding one of the country's first African-American investment banks, Doley Securities, which today operates offices in New Orleans and New York. Doley also advocates self-employment, although not necessarily right away.

"If you're a business major, I think you have that in the back of your mind," Doley. "Always look at ownership. And go into an area where you can get paid a return, like a sales commission or a bonus, on your efforts. That's the way it's done today."

Trainees in commission-pay industries usually get a salary until they pass licensing examinations, for instance, the Security Exchange Commission's Series 7 requirement for broker-dealers. After that, the company may continue paying a salary until the broker rises past an established commission level. Insurance is one such commission-based career. You can begin working as an agent for an agency in your spare time.

There are more than half-a-million insurance brokers and agents in the country, according to the Bureau of Labor Statistics. One fourth of them are self-employed, and about 40 percent of them sell life insurance.

Speaking of the insurance industry, Doley recommends the number-scrunching of actuarial science as a hot future career. Actuaries calculate how long people in certain categories are likely to live. Insurance companies and pension funds need actuarial calculations to decide how much money they will eventually have to pay their policyholders.

"With American baby boomers ready to live longer than their parents, actuarial tables from years ago will have to be changed." Doley says that Georgia State and Michigan are among the better schools for education in actuarial science.

Actuaries who pass their profession's exams had average starting salaries of $28,300 in 1990, according to The Occupational Outlook Handbook 1992-1993 (U.S. Bureau of Labor Statistics; Washington, DC).


According to Black Enterprise magazine, banking is the finance field employing the highest percentage of Blacks (11 percent).

There are four major types of banks:

* retail: handles the average person's kind of banking;

* commercial: lends to businesses, handles payrolls for them, etc.;

* merchant: puts its money into businesses and becomes part-owner;

* investment: helps corporations in raising capital.

By the year 2000, Black Enterprise says, America will need 28 percent more bank loan officers.

"Lending will always be a growth area," says Samuel Foggie, president of the National Bankers Association.

Even though he has taught commercial banking at Howard University, Foggie believes, "you don't learn lending in college. You have to get actual experience before you're able to predict that the majority of the loans you make to people will be repaid."

The average consumer loan officer at a bank with assets of a billion dollars earns between $33,000 and $44,000 a year. Climb the career ladder to head of lending and you'll make an average annual salary of $190,000, according to Robert Half International.

Foggie says retail bankers must be able to beat the competition at selling products like home mortgages, home improvement loans, and even financing local businesses and non-profit agencies. "The trend now is toward financing self-help efforts in the community. That wasn't always the case."

And with the dismantling of the Glass-Steagall Act, which had kept banks out of retail brokerering, bankers now compete to sell insurance, stocks, mutual funds, and other securities.


In general, you'll need an undergrad degree and/or an MBA in either accounting, finance, or economics to work in finance. Actuaries need actuarial studies degrees.

After teaching part-time for seven years at Southern University at New Orleans, Doley, however, prefers seeing students getting liberal arts baccalaureates ("the greatest education there is to teach you how to be flexible") and then moving on to other schools for their MBAs.

"Even if you can't afford to go to graduate school at first, work, save, and go back. There are weekend, summer, and accelerated programs. But you need that advanced degree."

Malveaux took degrees in international finance and multinational management from the Wharton School of Business at Ivy League University of Pennsylvania. She advocates at least two years of real-world work before taking a crack at the MBA. "Corporate America, and therefore business schools, are looking for people who've been in the business world."

The average MBA program runs two years. That leaves an all-important summer midpoint, which can be like a gold mine if you dig up a job that'll brighten your resume. Many schools offer ready-made internships. Duke University, for instance, helps MBA candidates work at U.S. companies in Japan.

Beg, borrow, or pray for a windfall. But land a summer internship! Check early in your first semester. If your school doesn't offer internships, track down a professional trade association or a corporation that does.

Just remember how Reg Lewis got started.
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Author:Chapelle, Tony
Publication:The Black Collegian
Date:Sep 1, 1993
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