Citi Shortens Analyst Program to Two Years as Wall Street Battles Private Equity for Young Talent
Citi will cut its investment banking analyst program from three years to two, promoting eligible third-year analysts on Jan. 1, as banks fight private equity firms that recruit junior talent earlier and earlier.
Citi is shortening its investment banking analyst program from three years to two, the latest move by a major Wall Street bank to hold onto young talent that private equity firms have been recruiting away earlier and earlier in their careers.
The change, confirmed by a Citi spokesperson, also applies to junior bankers currently in their third year, who will be promoted on Jan. 1 if they meet performance standards. The shift trims the six-and-a-half-year path from analyst to managing director by a year, according to an internal memo.
The decision reflects a widening contest for entry-level finance talent. Junior bankers typically earn around $80,000 in their early years while building the fundamentals of the trade. Their counterparts at private equity firms can make up to $300,000 a year, owning assets and making consequential decisions much sooner. That pay gap has pushed many MBA graduates toward private equity and away from the steadier, less glamorous promise of a banking career.
David Friedland, Citi's co-head of North America investment banking, framed the condensed timeline as a response to an accelerating recruitment cycle. «The reality that private equity is interviewing so early in a banker's career is very unfortunate and to some extent disappointing,» he said. «It's very hard to make a choice to go into another field in the first month you land on Wall Street.»
The recruiting timeline has collapsed over the past decade. Executive search firm Odyssey Search Partners found that in 2010, private equity firms typically began recruiting junior bankers after about 11 months of training. By 2024, that window had shrunk to less than a month. Private equity firms now pull college students into «coffee chats» and use «on-cycle» recruiting — bursts of interviewing and hiring that can begin two years before a candidate formally accepts a position.
Banks have responded with a mix of retention incentives and restrictions. Some have required loyalty oaths from junior workers promising they have not accepted roles elsewhere during their first 18 months. JPMorgan Chase told incoming graduates in 2025 that accepting a future position elsewhere before completing 18 months would result in termination. CEO Jamie Dimon has called young analysts who take such jobs so early in their careers «unethical,» arguing that even junior bankers with limited training are given access to sensitive information before private equity poaches them. Goldman Sachs has reportedly required junior analysts to confirm in writing every three months that they had not accepted outside future job offers, and Citi has required a one-time attestation from its young analysts.
Not everyone is convinced that private equity poaching fully explains Citi's move. The private equity industry has struggled over the past year amid high interest rates. Pitchbook reported 33,575 unsold companies sitting in private equity portfolios as of June 30, up from 32,451 at the end of 2025 and more than double the 15,923 companies from a decade ago. While private equity hiring has picked up in the last year on hopes of a rebound, some recruitment consultants believe firms will prioritize expertise over youth.
The change also aligns with the growing use of artificial intelligence in investment banking. Citi and other banks are ramping up AI adoption to handle tasks such as document review that were traditionally completed by entry-level workers. Meridith Dennes, managing partner at global financial search firm Prospect Rock Partners, said increased AI use could make a shortened analyst timeline more appealing because it would lower the commitment Citi needs to make to young talent. «You want to retain your top talent who are very analytical,» she told Fortune. «That's definite. But then I also think AI is replacing people, or the AI tools are working, and there will be impacts and headcount reduction on that.»
One early test will be how many of Citi's current third-year analysts are retained in the new year. If few are promoted, Dennes said, it could signal either a private equity slowdown or that the bank has found a way to reduce headcount in the AI era. CEO Jane Fraser has announced the potential for sweeping layoffs of up to 20,000 roles as the bank works to streamline and cut costs, though she has said she believes AI will transform jobs more than it will replace them. Last year, Citi began reskilling 175,000 workers on its AI tools. «I want to stack the odds that we will help our people reinvent themselves,» Fraser said at Davos earlier this year, adding that the bank wants staffers to «feel they've got a bit of control by having the training.»
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