Settling DCM/ECM once and for all

Debt issuance and underwriting isn't always done in the IBD.

EXACTLY. THIS IS WHAT I'M TALKING ABOUT.

everybody who was disagreeing with me can now apologize and then shut the fuck up.

At which firm do you work? Maybe your ECM does not get as much respect as at other firms.

My thoughts from the postings by Dan, Zala and all (1) Yes, ECM/DCM is considered front office, investment banking (2) But cos' of the role it plays in a capital raising transaction, the work done and skills picked up by a ECM/DCM analyst does not seem as challenging/intellectually stimulating as those done by M&A analysts. (3) Hence, zala feels that a ECM/DCM role is no different from a middle office role.

"(2) But cos' of the role it plays in a capital raising transaction, the work done and skills picked up by a ECM/DCM analyst does not seem as challenging/intellectually stimulating as those done by M&A analysts."

Given that structured debt is often within DCM, i don't think that you can say that M&A is more challenging/stimulating than DCM.

well according to this link ECM falls under global markets, not investment banking:

http://www.morganstanley.com/about/ir/presentations/acf_investor_presen…

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At different banks which group it falls under

Most product groups fall under DCM. At my bank, lev fin is DCM, and so is Asset Backed Finance, Structured Finance, Derivatives, New Products, Distressed Finance, Structured Credit Products, Liability Mgmt, Project Finance, and many others. I'd hardly say these are middle-office, or that they require fewer skills. In fact, some of the smartest people on Wall St are in these groups, including a lot of finance and math Phd's, and they are enormously profitable. The work is also often far more substantive than in IBD, at least for analysts and associates.

ECM and DCM straddle the markets/IBD divide at various banks so can feature in either/both pools (and can be part of the same group in some institutions). But to be 100% clear, both are FRONT OFFICE roles because you do deals for clients. There are many similarities between the two and a few important differences...

The skills (sales, product knowledge, understanding investor sentiment etc) are very similar. You are essentially the middle-man between issuers and investors, and such you spend most of your time pitching ideas to issuers. You originate deals and bring them to the market. When this happens, the syndicate desk manages the sale (i.e. investor allocations) and decides on the price. This process doesn't change whether you're talking debt or equity.

ECM tends to fit within IBD more because it involves company valuations. Therefore, there's a lot of modelling (Discounted Cashflow models, comp analysis) involved that means it's very similar to M&A. It doesn't matter much if you're valuing a business for the purpose of selling it to another company or floating it on the stock market.

The modelling involved in DCM is much less onerous as pricing is connected to deals that are already in the market. Therefore, you don't need the company valuation skills. DCM is a business involving much higher turnover - any one individual might work on several deals every month. In fact, deal execution is the tedious part.

Neither team is necessarily "better" than the other, but in some institutions you may get better kudos in one over the other depending on that company's reputation in each dept. Goldman being one example where ECM takes precedence, while at Citi the debt boys probably rule.

As for intellectual stimulation, it depends on your likes/dislikes. If you like modelling and long hours, go for M&A and ECM. If you like pitching and working in a more trading/mathematical environment, go for DCM.

"zala you're an obnoxious little boy."

Ermen, everything I've said has been backed up by Dan, yet you haven't said a word to him. I'm sorry that you're now realizing what a weak career choice you've by going into ECM.

Do you guys vaseline your penis' before you stroke. IT IS MIDDLE OFFICE. I think we have a bunch of DCM/ECMs trying to obfuscate. Maybe we even have a bunch of prospectives trying to fuck their peers over. DCM/ECM in the IBD group is IB. I fully understand M&A isnt the only banking theme. Have you ever heard of an IPO or junk bond offerings? Thet are done by DCM/ECM. Damn people, who are you. DCM/ECM is a group w/in IB. Now, pure DCM/ECM is, again, stroke-your-penis-middle-office. They are a go between. They don't get large bonuses like us. They didn't go elite school, they are middle office. Fuck people.

there is a clear distinction between the DCM/ECM IB GROUP and DCM/ECM Capital Markets people. People in DCM/ECM IBD are called investment bankers. People in DCM/ECM in capital markets, work in the "capital markets."

Some fuck said: "Debt issuance and underwriting isn't always done in the IBD." ----Just shut the fuck up. Please. Just stop and go elsewhere. Thank You.

Good points Dan, Zala. So how can I tell if a specific ECM group is in IBD or capital markets?

If you look on a website it will specify. For IBD they will have groups: M&A, LF, DCM/ECM, private placements.... For capital makets DCM/ECM it will be under the "capital markets" section. I can understand why so many people are confused, but it is just the way it is.

Dan, if you don't mind explaining it, what's the difference between capital markets ECM and IBD ECM? Don't they both raise money (equities) for companies? THX.

zala, no i am not in ECM so again if that's the first thing you assumed, i'm really sorry that you lack the ability to reason.

When people talk about DCM/ECM, they mainly refer to the group within IBD. The first thing that comes to mind is not that middle office nonsense. I'm not sure why everyone is so hung up over it?

Dan, are you saying that origination and execution are always done in the IBD?

just so we're all clear, zala = dan bush, he likes to use multiple screen names to back up his own points. what a douche.

Front office means that they work directly with clients. DCM/ECM work with clients (even in capital markets), and therefore are front office. Not that difficult is it?

"Front office means that they work directly with clients. DCM/ECM work with clients (even in capital markets), and therefore are front office. Not that difficult is it?"

At least someone knows what they're talking about here. Give that man a job. He probably has one, though, unlike some very angry people on this thread.

First off, fuck face, zala is not me. in fact, i have never talked to fuckin zala, so fuck off there dick twit.

As for, "Dan, if you don't mind explaining it, what's the difference between capital markets ECM and IBD ECM? Don't they both raise money (equities) for companies? THX." I would be glad to explain. IBD ECM will raise capital for the firm via equity. They will do everything from ipos to equity carve outs, they are investment bankers. People who work in the "Capital Markets" equity division are a go between. They work not directly with clients, but rather through IBers. As for "snake uk," go fuck yourself douche bag. Try to see if a client would ever hire a equity capital markets fuck -they are useless. I am a banker. I work everyday. I know how my firm, as well as others is structured. Don't fuckin argue with me. Damn i feel like a fuck face. I keep repeating my self over and over. I see these people who work in the "capital markets" everyday. They are JACK-YOU-OFF-MIDDLE-FUCKING-OFFICE. Man people, just stop already.

Dan you are a fucking moron. Just because your bank is structured a particular way does not mean that every other bank is structured in that way. The bank at which i work has no DCM at all in the IBD (the IBD comprises only M&A and ECM) - all debt underwriting and issuance is done through the FI division.

You must work at some 3rd tier shitass institution.

Also refers to S&T, which is definitely more front office than some analyst/associate in IB locked away in the bullpen will ever be. See your clients, much?

"You must work at some 3rd tier shitass institution."

That's an interesting way to describe Goldman Sachs. (not in london or NY though)

I call bullshit like its my job. I worked directly alongside a goldman DCM guy about 3 months ago. He was a banker on my syndicate. We issued some junk bonds. You guys really know how to fuck up. Don't argue with me.

"Capital Markets Also refers to S&T..."

That is NOT the fucking "capital markets" being talked about here. I, at least, was not even talking about DCM groups like ABS securitization.

"I call bullshit like its my job. I worked directly alongside a goldman DCM guy about 3 months ago. He was a banker on my syndicate. We issued some junk bonds. You guys really know how to fuck up. Don't argue with me."

I'm aware that GS in NY has DCM in the IBD - i said that where i work, we don't. Believe it or not, not all offices are structured identically.

you must not even work in the states then... GS IBD doesn't even have an M&A group... the only non-industry group would be LevFin. regional offices in the US at GS confer with New York/SF DCM/ECM guys on many of their transactions

i am not familiar with other international offices. and the FI division is called FICC...

No not in the US. Over here our DCM is part of FICC.

I love all this swearing.

You children are fucking shitass fucktards. I work in the industry. I have worked with DCM. I know what they do. I know how they do it. I konw who does it. Fine, so not all banks have IBD DCM. Nonetheless, most investment banks have people that issue bonds, and they are called investment bankers. The people that "work" in the capital markets are NOT investment bankers, they are capital markets assholes. There is a distinction. You ladies must be jacking off while responding to me. I work in the industry. I know the industry. I have worked with DCM IBD people. I have worked with pure capital markets people. I know what I am talking abouut. Now just SHUT THE FUCK UP.

For such a BSD you are getting pretty riled up on this discussion board. Did you piss off your staffer or is there some other reason why you have so much time on your hands, Dan?

These guys sure are getting worked up. They're probably shitty analysts/associates who get crapped on all the time and (trying) to take it out on the forum readers.

Typical of guys 'in the industry'. What's wrong? Bonus numbers not so hot compared to the rest of your peers?

Please. You won't last long. Congratulations on mediocrity.

zala's only in college

can't believe the people like this actually work in IB. isn't this meant to be a highly civilised and intellectual profession?

That is a common misconception. We are, in fact, all monkeys. Dan is our equivalent of Furious George.

I hate fucking people disagreeing with me who have absolutley no gravitas at all. Yes, let us have an intelligent conversation, so long as you know what you are talking about. Don't fuckin jack me off and tell me things like, um, "debt issuance isnt only done in IBD." Just shut the fuck up with that bull shit. I work with these people on a daily basis. They are fucking assholes. They are not front office. They are as I have represented them.

Oh Dan, you foul-mouthed trader you.

Let me see if I understand this:

You, a BSD, are a front office Banka. They, are back office 'fucking assholes'.

Yet you, "work with these people on a daily basis".

Are you in syndication?

I am in sponsors at a bulge. They are not front office, as the IB industry describes that placement. They are middle. Also, I am not a trader, as was indicated above.

Dan you are the laughing stock of these forums. You have been proven wrong time and time again yet you continue spounting your crap. What a joke.

How have I been proven wrong, sir? Everybody here seems to agree with me, you fuck face. Everybody I ask here in the office on this lonely saturday morning, says capital markets folk are stroke-me-middle-office. Now who is the fucking joke. Two analysts, 2 associates and 1 vp seem to agree with me. Thanks you very much shitfuck, but I prefer to take their word over that of an anonymous poster. Go fuck yourself.

What makes one bank put ECM in the IBD and another put ECM in the Capital Markets Group?

It occurs because there is one real ECM/DCM division and then there is an underwriting group in IBD that issues debt (DCM) and equity (ECM). I think we can all fucking agree that banks have divisions. They have equities, fixed-income, IBD, capital markets, operations etc. In equities you have trading desks, strategy groups et cetera. In capital markets, there are people who "work in the capital markets." They are a go-between. They go between bankers et al. and "assess the climate" of the capital markets. Now, IBD has investment bankers who DO NOT "work in the capital markets." Instead they work in IBD, hence their fucking titles. They work in IBD in a product group. They issue, manipulate, and just work with capital markets products. These products may be bonds, stocks, derivatives etc. I understand your questions, it is difficult to explain to people with no experience who want insight. The aforementioned swears do not pertain to you. They are for the fucking assholes who continue to fuck me around on this forum. They not only fuck me around, but everybody else who would like some insight into the business. They don't fucking know what the fuck they are talking about and they fuck people over. Stop the fucking bullshit.

dude, its an online message board. Not sure why you're so passionate/worked up about it.

I love you Dan. You're such a straight arrow who speaks his mind. Regardless of whether you are right or not, I still love you.

So to sum it up, investment bankers who work with companies to raise cash via equities work in "ecm" in an IBD, while other ppl who just underwrite equitities (like a loan officer who files paperwork) are in "ecm" in capital markets. Am I close? Someone in NYC asked me to join their ECM division in the IBD, but being a boutique bank I'm not sure if they're me the truth.

Well thank you, if you are a female I love you too. If you are a guy, well, thanks again. You are partially right in your summation. People in IBD that issue equity/debt are ECM/DCM IN IBD. If they work at a bank, but are not in the investment banking division, they "work" in the capital markets. They are not front office. The loan officer example that you gave is not a good example. They usually go out of a commercial bank, and if they are in an investment bank, there functions are not similar and the repective divisions are disperate.

No, I'm a brother but I still want to profess my brotherly love to you. A friend of mine just got offered an ECM job in an IBD helping the senior ppl raise equity, prepare pitchbooks, and doing basic valuation stuff and keeping track of the market. That's in IBD and not cap mkt right?

Thanks Dan.

Correct. That sounds to me like IBD.

Read on one of the canadian IB's sites abt Debt Origination: "...expertise in bringing new issues to the dcm & advising on optimum financial structures, obtaining credit ratings, placing public & private debts"

Which area would you place it to? IBD or capmkts?

P.S. I learned a lot how to swear while was reading your posts :)

i will be at Morgan Stanley gcm and it is organized under its ib division.

Classic thread....

Though citi cmo = middle office in my opinon. Different division from IBD and different recruiting.

Although I don't think many banks have that distinction anymore (ECM/DCM within IBD vs. ECM/DCM in "capital markets"). They probably just combined the functions into one role.

great thread, i miss those days