What's the difference between ECM/DCM and IBD?

What is the difference between ECM, DCM and IBD? I've went through sites like M&I, and I still don't get a clear distinction between them. Are ECM/DCM exclusively product groups while IBD is an exclusively industrial group?

Also, it seems to me that S&T, ER and ECM/DCM are commonly categorized under Investment Banking, however, there seems to be an Investment Banking Department under Investment Banking itself, does this mean the coverage group?

How competitive would you say it is to get into ECM/DCM vs. IBD?
How different are the skillsets required for ECM/DCM vs IBD?

Much appreciated.

Comments (8)

Best Response
Jun 30, 2013 - 4:41pm
mrb87, what's your opinion? Comment below:

This is actually a question to which there is no 100% correct answer. Some banks categorize ECM/DCM under the Investment Banking Division, which usually also includes research. Some banks, although I think this is becoming more uncommon, categorize them under Sales and Trading. Some banks even categorize ECM under IBD and DCM under S&T (or FIC, or FICC, or whatever).

The difference really is that ECM and DCM are product groups that are close to the capital markets, and therefore it makes more business sense to put them closer to the S&T groups (physically and/or operationally). M&A is a product group, too, but the nature of their work makes it more logical to organize them closer to the industry coverage teams.

They're all "investment bankers" though, in the sense they are client-facing, do high-profile transactions, and make a lot of money.

ECM/DCM is less modelling intensive, more market-focused and a little "softer" in terms of the skill set. M&A is very modelling intensive and analytical, but a lot of guys in it only know how to model and can't see the forest from the trees. M&A tends to be more competitive to get into, but in reality the standards are not that much different.

As far as skillset required to get into M&A versus ECM/DCM: beyond taking an accounting or corporate finance course, it doesn't matter -- you have no skillset right now, nor does any other college sophomore/junior.

Jul 5, 2013 - 9:44pm
shpoopyshpants, what's your opinion? Comment below:

difference between IB and ECM/DCM (Originally Posted: 03/05/2010)

I'm thoroughly confused on what ECM/DCM does. I know IB is M&A, IPOs, advisory, etc. but where does CM fit in? It's not like S&T so...

Jul 5, 2013 - 9:46pm
skype, what's your opinion? Comment below:

Capital Markets groups are the actual source of execution with the bank. DCM provides indicative pricing and issues securities. The banking group "covers" a client sector and handles the relationship with clients.

When a client calls the bank, he calls his banker. The banker then reaches out to the various products (M&A, DCM, LevFin, etc.) depending on client need.

Think about a BioTech company wanting to do an M&A transaction but it needs financing via bank loans, investment-grade debt issuance, and maybe a convertible bond transaction. The banker reaches out to his respective product bankers and organizes a deal team.

You won't be getting any valuation skills in a DCM group. Instead you'll be learning how to keep track of the debt capital markets.

Jul 5, 2013 - 9:48pm
skype, what's your opinion? Comment below:

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