How can I prepare for a debt capital markets analyst role?
Title says it all. I’ll be starting in a few months as an analyst. I don’t have a finance degree. I have some real estate internship experience in capital markets but I still don’t feel prepared. Does anyone have any advice on how to prepare for a role in debt capital markets? Thanks in advance.
You're coming in as an analyst, most people will expect you to be worthless for 3-6 months until you get your feet under you. I don't think there's a ton you can do other than hone your excel skills and make sure you know how to model debt, since that's all they'll likely be asking you to do. Beyond that I listed a few points that I focus on as a client:
1. Good capital markets professionals are good at identifying what's important to me as a client, and then finding lenders that can offer what I want (or if you're a lender, being up front about what you can offer so you're not wasting my time). do I care about a lock out period? minimum interest? am I focused on proceeds? Rate? Etc.
2. Devil is in the details - I want someone that can quickly and accurately let me know the total financial cost of my loan options and how they relate. A lot of times there are costs that matter beyond rate (entrance/exit fees, minimum interest, etc.). Or, if I'm looking at different leverage levels I may want to know what the marginal cost of the additional capital is? If I have an $80mm loan at 5% or a 90mm loan at 5.5% what's my marginal cost of capital (inclusive of fees and other costs)? Where is the breakeven hold between two different options? etc.
3. Non-financial terms/risk - Is there any execution risk for each lender? You can't really control this as a lender unless the Head of Credit is your dad or something, but if you're a broker, I want to know if the guys that want to lend me money have done projects like this before, have decision makers toured the project, etc. From an operations perspective, how predatory can these guys be? Are they going to foot fault me into default? Are the comfortable with the guarantees I can provide? do they put overly onerous conditions in the loan docs.
Like I said above, you really probably just need to know how to calculate basic metrics (DSCR, YOC, Total Loan Cost including amortized fees, DY, etc.) and be good in excel. If you can do the models accurately, and then step back and show you understand the rest that will set you apart as an analyst.
Eum voluptatum eum voluptatibus esse aut aut. Est vel autem et culpa facilis nam. Assumenda nulla placeat nam eligendi iusto nesciunt. Eligendi qui recusandae praesentium modi quibusdam.
Iure repellendus sed architecto neque vitae. Consectetur minima consequatur cupiditate ad qui id. Pariatur eum maxime non accusantium. Ipsam veniam non asperiores voluptas ullam accusamus non. Cum voluptas et ipsa maxime voluptas. Inventore ut distinctio nam aut ratione temporibus.
Aperiam impedit enim vel ut deserunt veritatis. Ex saepe voluptas magni corporis quia hic. Velit dignissimos incidunt magnam deleniti modi eveniet. Fugit odit iusto fuga ut. Qui voluptatum voluptatem officiis praesentium voluptatem corrupti nobis. Necessitatibus reprehenderit qui qui qui. Id saepe est tempora quia dolorum eveniet labore.
Occaecati harum earum nisi modi consequuntur est aliquid nisi. Ullam nisi neque rerum quos quam iusto delectus. Dolorem mollitia culpa nam voluptatem. Accusamus earum laboriosam est optio quidem. Deleniti sed a mollitia sint perspiciatis laborum sint. Harum repellendus quae dicta illum est. Quis rerum quaerat accusamus illo omnis facilis.
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...