DCM to LevFin?
How often has this been seen in BBs? Is it possible after a two year stint to move over to the LF side? Curious to see if any has made the move
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Based on the most helpful WSO content, moving from Debt Capital Markets (DCM) to Leveraged Finance (LevFin) within Bulge Bracket (BB) banks is indeed a path that some professionals have considered and pursued. The transition is seen as feasible but comes with its own set of challenges and considerations.
Here are some key points to consider based on the shared experiences:
Skillset Overlap and Differences: While DCM and LevFin roles both deal with debt instruments, LevFin tends to involve more complex structuring and higher risk transactions, including leveraged buyouts (LBOs). LevFin roles often require a deeper understanding of credit analysis and financial modeling compared to traditional DCM roles. Therefore, professionals looking to make the switch may need to bridge any skill gaps, particularly in financial modeling and credit analysis.
Internal Lateral Moves: The possibility of moving internally from DCM to LevFin within a BB is acknowledged. However, it's important to note that such transitions may require strategic networking within the firm, showcasing relevant skills, and possibly even starting at a more junior level in the new group to gain the specific experience required.
"1 Step Back, 2 Steps Forward" Approach: Some individuals are open to the idea of taking a step back in their career progression (e.g., re-entering as a 1st year analyst in LevFin after spending time in DCM) for the long-term benefit of aligning with their career goals. This mindset can be beneficial in making a successful transition.
Market Conditions and Openings: The feasibility of such a move can also depend on the current market conditions and the availability of openings in the LevFin team. Networking and maintaining good relationships within the bank can help in identifying and seizing such opportunities.
Preparation and Positioning: For those in DCM aiming to transition to LevFin, focusing on deals that have a closer relation to leveraged finance, seeking projects that involve financial modeling, and expressing interest in the LevFin space to mentors and managers can help in positioning oneself for such a move.
In summary, while moving from DCM to LevFin within BB banks is not unheard of, it requires careful planning, skill development, and networking. It's a path that has been taken by some, demonstrating that with the right approach, it's a realistic goal.
Sources: Going from IB to ECM or DCM? Anyone made this move?, https://www.wallstreetoasis.com/forum/investment-banking/qa-2nd-yr-ib-analyst-australia?customgpt=1, BB Debt Capital Markets - Exit Opps / Comp, Debt Capital Markets "Exit Ops", Hours: LevFin v DCM London
Extremely doable know a lot of people at BBs that have done this
Very doable. I did it when I was an analyst at a BB a few years back. Moved from DCM to LF in my first year. Not very typical- I think some kids are able to move after 1 year, other after 2 years, then take a Sr. analyst year in LF.
I think both groups are great, just depends on your personal interests and long term goals.
Happy to answer any Q’s.
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