Pitchbook in LevFin?
Hi,
Newb question: in LevFin, how often do you need to create pitchbooks and presentations? Someone told me that LevFin is heavy financial modelling. Is it true?
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levfin groups in most banks from my experience are lazy as fuck... 10% of those guys will get good buy side jobs and the rest will just be typical product bankers who have no interpersonal skills and can't face clients so they just run internal credit approval processes on some co-managed or non lead left book run 200mm HY bonds all the time
^wtf is his problem
Hope this is helpful (unlike the rancid flame in the first post):
LevFin responsibilities vary across banks -- as a general theme, they are the group responsible for financing solutions for Leveraged Buyouts / Acquisitions, and high-yield junk bond refinancing.
Is LevFin more technical than the vast majority of all industry groups? Yes. It is technical in the sense that you will have to understand the products themselves (HY bonds, leveraged loans, capital structure). Sometimes this means you will do financial modeling, other times you won't. Typically, for HY bond issuances, especially drive-by issuances, there will be little to no modeling. For LBO and Acquisition Financing, the LevFin team will be responsible for the financing model (e.g. cash flow waterfall)
LevFin is a very unique skill-set. The credit markets as a whole is less visible, and thus less understood than the equity markets. LevFin will set you up for PE and distressed debt hedge fund exit opportunities.
HOWEVER:
It should be understood that LevFin is a FINANCING skill-set, and not a STRATEGIC one. You will learn to look at a company's finances analytically - BUT, you may not learn to look at a company STRATEGICALLY. What does this mean? A good LevFin shop will be able to come up with the optimal financing structure for an acquisition / LBO, but a LevFin team will not necessarily think about what further merger/acquisition opportunities this company should pursue. Conversely, industry teams (theoretically) allow analysts to become familiar with an industry (i.e. STRATEGIC skill-set), but they understand little about the actual mechanisms of how the financing works.
As a group in general, a good LevFin team at a larger bank will generate more money than virtually any other group. Due to stable vanilla refinancings (less-sexy, but more stable), LevFin teams also bear the brunt of recession better than other product/industry groups.
I've actually heard a lot of PE shops prefer a LevFin background over an M&A background in a lot of cases.
Hey guys, thank you so much for your information. Very helpful.
M&A is also a specialized product, but it is still strategic right?
M&A is still a better group to join relative to Lev Fin as it gives you a broader experience and better exit opps.
I know this might have been discussed before, but how is the work & exit opps different if the LevFin group is under DCM as opposed to IBD.
I am interviewing for a Lev Fin position at a MM firm, but the group is part of DCM, and all the analysts/associates in the group seem to have backgrounds as credit analysts or somethign along the lines. Is there a substantial different between LevFins groups that are under capital markets vs IBD? again mainly concerned about exit opps to PE
if lev fin is in capital markets its absolute crap.
GS, MS and Citi LevFin have 0 modeling and 100% pricing+updates+admin work. its basically back office for the bankers who model.
thanks boutique. anyone else?
Don't listen to this crap. M&A~ product will disappear going forward. At MS they are cutting M&A execution and combining it into the sector coverage teams. UBS , JPM and CS are doing similar things....
Even in the old days in M&A execution updating investor presentations, uploading 1,000 docs in a virtual dataroom would be the majority of your work...
LevFin is the place to be. All PE value levfin over M&A .
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