LevFin modeling groups vs non-modeling groups, outcomes

If you're comparing modeling-heavy LevFin groups (like BofA or DB) to non-modeling groups (like JPM), here’s what you need to know:

1. Modeling vs. Non-Modeling Work:

   • In modeling-heavy groups (e.g., BofA, DB, CS), analysts are deeply involved in building and tweaking financial models, particularly cash flow and debt repayment models. This provides a more technical skill set and a better-rounded understanding of deal mechanics.
   • Non-modeling groups (e.g., JPM, GS, MS) focus more on capital markets execution, such as pricing, market updates, and structuring. Analysts in these groups typically don’t touch the operating model, as it’s handled by M&A or coverage teams.

2. Career Implications:

   • For PE Exits: Modeling-heavy groups are advantageous if you’re targeting private equity or other buy-side roles. PE firms value hands-on modeling experience, and being in a group that "holds the pen" on models can make you more competitive.
   • For Career Bankers: If you’re planning to stay in LevFin long-term, the difference may not matter as much. Non-modeling groups often have better hours, and the focus shifts to deal structuring, credit analysis, and relationship management—skills that are critical for a career banker.

3. Hours:

   • Non-modeling groups generally have better hours compared to their modeling-heavy counterparts. This is because the work is less granular and doesn’t involve building or stress-testing models from scratch.

4. Skill Development:

   • Modeling-heavy groups provide a more technical foundation, which can be useful even if you’re not exiting to PE. However, non-modeling groups offer exposure to capital markets and deal execution, which are equally valuable for certain career paths.

5. Does It Matter If You’re Not Targeting PE?:

   • If PE isn’t your goal, the difference in modeling experience may not be as critical. Instead, focus on the group’s deal flow, culture, and alignment with your long-term goals. For example, JPM’s LevFin group has strong deal flow and a great reputation, even if it’s more capital markets-oriented.

In summary, the choice between a modeling-heavy and non-modeling LevFin group depends on your career goals. If you’re aiming for PE, go for a modeling-heavy group. If you’re looking to stay in LevFin or prioritize work-life balance, a non-modeling group like JPM could be a better fit.

Sources: Lev Fin Outlook & Best Groups 2020, Leveraged Finance – 2017 Update, For those of you who worked at a BB that has a separate modeling group (M&A), do you feel like you gain less technical skills?, Is modeling more difficult in certain sectors versus others?, JPM Lev Fin vs. BAML Lev Fin