Incoming Leveraged Finance Analyst - Bulge Bracket - What to prepare for ?
Hi everyone,
I recently completed my MSc in Finance at a Target School in Europe and have prior internship experience in Debt Advisory and Restructuring at boutique firms (MM & EB). I will soon be joining a BB Leveraged Finance team in London for my first full-time role.
While I consider myself fairly knowledgeable about the Debt/Leveraged Finance space, I have not yet worked directly in a Leveraged Finance team at a Balance Sheet Bank. My prior experience has been in boutique environments, so I’m keen to understand how this transition might differ in terms of team dynamics, expectations, and the broader working culture.
I’d greatly appreciate any advice on:
- Preparing for a Leveraged Finance entry-level role: Are there specific technical skills, resources, or habits I should focus on before starting? Major differences between pure Advisory work (Debt Advisory & Restructuring) and more investment-type work in Leveraged Finance ?
- Key differences between Boutiques and larger Banks: From workflows to team collaboration, what should I expect to be notably different?
Following
Bump
Bump
Bump
You’re so fucked bro
Are there any primers or guides for LevFin? I'm more inclined towards LevFin rather than M&A
There's an LCD Leveraged Loan primer which is pretty good :
https://www.lcdcomps.com/d/pdf/LCD%20Loan%20Primer.pdf
Was a BB LevFin analyst for 2 years at top US LevFin group. We never expected the analysts to come in with a bunch of background knowledge. Just be willing to learn quick/fast once you join.
Conceptually, there isn’t a ton that you won’t have seen as a Finance major / through past experiences. Just know your simple stuff around secured/unsecured, first lien/second lien, bonds/loans, yield, fixed/floating rates, SOFR/LIBOR.
From a BB vs EB perspective, I’d bet lifestyle is a lot more chill, your focus in LevFin will truly just be on the product that you cover and you’ll rely on coverage groups to do some of the heavier lifting when it comes to managing company-specific work streams. That helps with not having to do a bunch of random stuff and typically less “super urgent” client requests at 1am.
You can always read the S&P primer like another user pointed although some of the info there is US-centric and a bit outdated. There is similarly a High Yield primer from Moody's I think. And if you really have time to kill you could read "A pragmatist's guide to leveraged finance"
That said, anything you need, you will learn on the job. It is overall easy, but tends to be intense. To help cope with the intensity it's important to be efficient:
-as a junior you will be putting a lot of comps and trading levers together so get your templates going and make best practices a habit
-similarly you will see more captables and term sheets than you can count - get your templates going (have standard setups for different situations (refi reprice, for different products etc)
-understand how to reconcile a model (do numbers add up, does the model make sense, is the repayment on the right basis)
-map your processes so that you know how to handle different stakeholders proactively
Just got promoted to VP in levfin at a BB. Couple stream of consciousness thoughts.
Fitch actually puts out a very good levfin “annual manual”. Good starting point for the basics.
Lev fin is very execution oriented. You’re not going to be expected to know all the steps of a deal when you get there so ask all your questions the first time around, but after that you should show you know what’s going on for the next one. Send an email to your associate and say hey I think we need to get started on x, y, z. “Understands the process and can anticipate next steps” is always something people will say about a strong analyst
Start developing your credit skills. When pulling pages together on a business don’t just copy and paste on the slide. Take a step back and study how the company actually makes money, what are its strengths and what are the key risks. And how will the market view those risks and what are the mitigants (counter arguments) for why they should still like this credit.
As others mentioned, get the basics down quickly on the products (TLB/HY, maybe you will do some bank deals too) and what are the benefits and considerations of each. Also start familiarizing yourself with credit agreements / legal docs. Analysts won’t be expected to drive this workstream but I see really good 2nd year analysts providing value by taking their cut at responses to the issues lists and forwarding to their associate/VP as a starting point.
Yes this is definitely the next level, the thoughtful stuff. My original response above focused on the basics.
In relation to the above, one of the most important things is to have an opinion and be able to communicate it simply and clearly. Do you like this business and why. The higher ups love this
How does this differ from doing Debt Advisory at an EB firm? Focus there is probably less on execution but what about the „credit skills“? Do you develop them equally?
If you’re talking debt advisory like a EY or PJT, biggest difference is they are only dealing with one stakeholder (the company) who they are trying to make happy. On our side we have the company but also the market and need to be balanced in our advice on what will lead to the best outcome.
Not sure how much credit work those guys do. Maybe some in helping develop the presentation for marketing but they don’t really dig in from an underwriting perspective. Much more credit work on our side, especially when doing underwritten deals where we are taking real risk.
Similique consequatur repellendus error quia iure. Esse facere sed quod alias eveniet. Dolorem aut doloribus est odio.
Ea et dolorem sunt amet. Placeat et molestias dolore ut mollitia aliquam. Quibusdam voluptates dolores aut inventore amet rerum. Quia natus possimus enim veritatis distinctio aut.
Omnis ullam aspernatur dolorem sit est quia exercitationem. Modi et consequuntur deserunt neque non odio. Aut et quaerat aut repellendus non a ut.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...