Distressed Debt/Special Situations at BB

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So, congrats on the offer from DB.

From my understanding, the role is more research based there. Comp is in line with lots of their S&T desks, but not a big money maker

I had a couple of friends who did this at one of the major banks and even one moved on to another major bank and nicely tried to see if I could join him. Seems like the work is similar to IBD RX in terms of analyzing companies and credits, modeling, research, etc but it’s more about serving the S&T desk as opposed to like corporate clients or PE firms. More market facing so hours are closer to that comparatively (prob an earlier start to the day like before market open as opposed to the relatively more lax start time for analyst in IB), and a bit more sensitive to how things actually trade and get priced within 12 months since hedge fund clients do get performance assessed annually. Pace seems like it can feel like “live-deal” mode during market hours each day to some extent and then quiets down to some extent when standard market hours are closed.
 

exit ops I have seen are more in line with the credit hedge fund world or credit funds in general. Whoever the clients are. Comp in line with S&T type pay grades but ultimately if you make good trades and investments and make money in the market your comp will be tied to that in the long run 
 

Good luck 

Work is going to be quite a bit different than an RX group for conflict of interest reasons. A firm cannot be an adviser to a company that they are also a lender to. So, as stated above this is more of a research type role. 

What firms have good groups amongst the major players? 

Citi - exited business

MS? 

GS?

DB - supposed to be strong

BofA?

JPM?   

Barc?   

Anyone got insights about BofA's Global Credit and Special Situations team?

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You're still very young so you could probably hop to a hedge fund analyst in a few years. But stay too long and you could easily get pidgeon-holed. You aren't investing capital or making recommendations, seems like you are just running the numbers and feeding data to the decision-making team. Be weary of staying long-term unless you want to hop to a CreditSights, Reorg, etc or some similar research role

Did last summer on a distressed debt desk, one of the BBs you mentioned. Was very interesting. A lot of deep fundamental credit work, great gig to get a solid understanding of the debt side.

Im now working part time in a private debt shop before hitting BB FT in summer and one of my bosses used to be in a well known distressed fund. He says if you can do distressed credit well you can do any credit well. So, yeah, its interesting, has good exits and you get to have risk to your name aswell. Is this London or NYC btw? 

Anyone got info on exitx, comp etc, espcially at BofA's Global Credit and Speical Situations team?

imo these are highly underrated roles (not to say they're easy to land). you work on deep fundamentals, get to look at live situtations, learn how S&T guys think, and also get exposure to risk appetites / investment styles of various buysiders. arguably one of the best places to make an early name for yourself and get a flavor for how the whole sausage is made re: putting on and living with risk. great way to discover what you like / dislike too as a younger candidate -- plenty of stories about ppl who jump to a fund only to discover within 6 months that they hate it. would say there are not too many limits on potential exits if your objective is to become a buysider in similar products

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the job, in theory and high level, is similar to what you would do on a distressed seat - you look at bonds, loans, equities, racier new money trades, liquidations and what not - there's a different limit to esoteric stuff using a bank's balance sheet vs a fund as you can imagine. You're supposed to form a view on a business and come up with recommendations on wtv instruments are available. 

Its a pretty good seat to have out of school if you like investing, are a curious person and decent technically. you get good exposure to your next employers if you want to stay in this line of work - so, if you want to get on the phone with an analyst at a fund, dont look like a fool, market is pretty small.

so take the job, work your socks off, network like crazy, and make sure whenever you get on the phone with clients, you know your stuff.

big differences between fund vs desk are as follows:

i) the amount of capital a desk is allowed to deploy and how much exposure they can take (read reputational risk) is dictated from the top. you might be told beginning of the year 'we want to deploy x bn', to get all risk culled from under you by the time summer comes around. you get into a trade that goes sour with a client (PE shop...) from the bank, and you might just have to bend over. 

ii) very few desks will build sizeable positions (committee sized positions), some end up with them by mistake. Committees take a lot of time, and also bring a lot of headline risk on the press. 

iii) liquidity - banks are more sensitive to illiquid instruments, bc they might not be able trade them and they get hit with higher capital charges (especially with equities. whether bc its a longer hold reorg equity or some really esoteric financing

iv) some desks really do deep dives, they invest a lot of resources and dissect a company/trade inside-out. however, most dont. they do a couple of hours/days of work, which is enough for them to take a position, get on the phone with funds and make markets. their business is trading, so they gotta be careful with time spent on each name - I only speak with desk analysts when i want to get up to speed on a name quickly, other than that, 99% probs of being a waste of time (not saying they aint smart, but they just dont have the time and repeat what other buysiders told them)

hope it helps (and ignore the comments about reorg, that happens if you are lazy or by choice, so its in your hands)

Currently in direct lending with some workouts experience, and want to pursue more opportunistic investing. Would a desk analyst role be a move in the right direction to get to public oriented credit HF role? How does comp progression scale vs. VP level in privates investing?