CMB Credit Analyst trying to move into Direct Lending
I’m currently a 2nd year credit analyst and I want to break into Direct Lending. My role involves credit underwriting for new loans (TLA & RCF) and portfolio management for mid-market and large corporate companies. The transactions I work on are for growth financing (capex, working capital), M&A, and dividend recaps. However I have no LBO experience, thus no technical modelling experience on this. Nonetheless, I have strong credit acumen and believe I would do well in a direct lending role. I’m curious what steps to take to land an interview and ultimately get the role.
Based on the most helpful WSO content, here are some steps you can take to transition from a CMB Credit Analyst to a Direct Lending role:
Highlight Relevant Experience:
Develop Technical Skills:
Networking:
Tailor Your Resume:
Prepare for Interviews:
Consider Lateral Moves:
By following these steps, you can improve your chances of landing an interview and securing a role in direct lending.
Sources: Lateraling Guide for Investment Banking, Lateraling Guide for Investment Banking, Investment Banking Interview Questions - 15 Answers to Land the Job, Credit Analyst Q&A, You want a summer analyst offer? Here's how...
bump
I'll bite with my two cents.
Look for firms that are hiring for Direct Lending ("DL") portfolio management associates that also work on incremental/new asks from existing clients (i.e. refinances). I know firms that bifurcate the DL associate roles into 1) initial underwrite and 2) portfolio management, they tend to look for corporate bankers/junior credit analysts for the former (reflective of lower pay and lower hours for strictly portfolio management). To get looks (and an interview), you might have to get to know recruiters on linkedin. A majority of PC firms utilize headhunters/recruiters. Conversely you can just watch PC firms' websites for new roles and cold apply.
I strongly recommend you reach out to current team members with genuine curiosity to determine how a respective firm splits roles & responsibilities which is important to know, and only really possible to find out through interviews/coffee chats/etc... All firms differ slightly in who holds the pen for certain tasks, but the overall process is the same across the lending industry (even corp. banking). If you find out the firm has its DL associates doing BOTH port. mgt and underwriting, you'd probably be not as competitive unfortunately. For associates with any initial underwriting responsibilities, most PC firms look for individuals with lev fin or restructuring banking experience which tend to also have LBO modeling experience.
To be competitive for DL, really brush up on your credit agreement skills and know where to find certain items quickly. That's how you differentiate yourself as a stronger analyst in a pool of corporate bankers all vying for the same gig.
Hope this helps.
Thanks so much for your response, I really appreciate it! I’ll definitely reach out to team members at different funds to get a better understanding of team structure. Regarding my lack of experience with LBO modelling and transactions, I bought this book called “Investment Banking: Valuation, Leveraged Buyouts, and Mergers and Acquisitions”. Not sure if you’ve heard of it but people say it’s a great book to bridge the gap and beef up my technical and modelling skills. My plan is to read the book and improve my technical skills so I can showcase in an interview and begin work (if hired) ready to go. Do you think my strategy is effective or am I better off going to LevFin then transitioning to Direct Lending.
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