Looking to learn more about this type of lending and the difference between all 3/if it's synonymous.
- Do people tend to come from fixed income backgrounds or would someone from a commercial banking/commercial real estate background be able to transition over?
- What does the interview process look like/what should you know to prep?
- What are the hours like?
- Any preferred certifications or technical skills? MBA? CFA? Python? VBA?
- Breakdown of what your average deal looks like? I imagine it's split between Power/Infrastructure/Real Estate?
- What does comp looking like at the analyst level? Base/Bonus? How does comp compare long term to something like REPE
- Is this an accurate/similar representation of the industry in Canada? https://mergersandinquisitions.com/direct-lending/
Some of the shops/players in Canada that I've found are the following
- Nicola Wealth
- Empire Life
- Timbercreek
- TD Asset Management
- IMCO
- Manulife?
- Forum Asset Management?
- Canada Life/GWL?
- RBCGAM?
- Slate Asset Management?
? - not sure but just a guess*
Please let me know if there's other notable shops that I may have missed
Thanks In Advance
Based on the most helpful WSO content, let's dive into your queries about Private Debt, Private Credit, and Direct Lending in Canada:
Private Debt vs. Private Credit vs. Direct Lending:
Backgrounds for Transitioning:
Interview Process and Preparation:
Work Hours:
Certifications and Technical Skills:
Deal Breakdown:
Compensation:
Representation of the Industry in Canada:
Notable Firms in Canada:
For someone with your background, transitioning into this space would involve leveraging your existing knowledge in commercial banking and real estate, while also building a strong foundation in credit analysis and financial modeling. The interview process will likely test these areas, so preparation should be tailored accordingly. Keep networking to learn more about the nuances of the Canadian market and the specific firms you're interested in.
Sources: Private Debt/Direct Lending/Private Credit - What are the differences? Best firms with WLB, What are the different types of Credit?, Private Credit Resources and Prep, Private Credit / Direct Lending Comp, Private Credit / Direct Lending Comp
Bump
Following
bump
I’ve heard bad things about Nicola in general. The names you have also aren’t that good IMO. The pensions all have private credit arms, Anteres is owned by CPP as well, Northleaf is good, Penfund is really good too. Ideal background is realistically someone who did LevFin at a top bank
What are the typical backgrounds that they're lookin for in private credit? other than LevFin? IB? PE? is corporate banking possible? Any primers/prep material to recommend?
I don’t know enough on the space to say with conviction. My guess is the normal backgrounds of PE/IB are the case in most cases, but I could see someone with corporate banking having a shot.
It’s just always easier to hire people from PE/IB because if they don’t work out you went with the blue chip candidate. You know 100% they have worked long hours on deals and have the training that makes life easier, but I recognize elements of corporate banking would be transferable.
Just reach out to people and see what they think. Look at LinkedIn profiles for people at said firms and you should get your answer
The pensions' private credit arms aren't doing the same type of 12-18% interest distressed deals the private shops OP mentioned are doing. Agreed some of his list is crap or similar profile to a pension (lifecos and banks), but Slate and Timbercreek are doing real, interesting private credit deals albeit Timbercreek/Hazelview aren't in the best position today.
OP you also missed KingSett on your list. And corporate banking is for sure able to move into private credit in Canada, commercial will be tough though. IB/PE/LevFin are the obvious pipeline (or buyside in real estate if you're going to an RE-specific shop at a more junior level), but frankly most of those guys aren't looking to move to private credit.
Worked in the space as an Analyst for over a year, so I can provide a bit of input.
As you probably know already, the credit space here is insanely small compared to the US, and we only have about a handful of good credit funds in Canada.
Would agree with what has been mentioned above that IB experience is preferred for the more "attractive" credit shops. Most people you see that go from Corporate Banking to Private Credit in Canada really do so because they're moving to a shop that mainly does senior lending, and don't really go too deep into the capital stack. As a result, most of the skills are transferrable because the work itself isn't too complex or different from CB. However, if you want to move to a team that does more interesting deals in TLB's, mezzanine, preferred equity, etc. that is heavier on modelling than you'd typically need an IB background, as most of the time CB doesn't really cut it. These roles are more similar to Private Equity, hence why you need a solid understanding of modelling, credit stack, LBO analysis, etc.
Some info on shops (some info is anecdotal):
- Penfund: Not talked about enough. Work on interesting deals, and has some really smart people on the team. Also heard they pay well (150k+ all in for 1st year analysts), but according to others comments is a bit sweaty. Most of the team comes from an IB/PE background.
- Sagard: Also has smart people, they introduced a senior lending team a while back as well to add to its existing credit arm. Comp is pretty good, the credit team has a great reputation. Also mainly recruits from IB.
- Pensions: Some of the large pensions in Canada are continuing to grow their presence in Private Credit. Most of them still group it under their capital markets teams. Good comp (think ~130-160k all-in for AN1) and culture is usually the main selling point for these places, but you probably wont find a lot of exciting deals being done given that they're a bit more risk averse. That being said, have seen some corporate bankers and other credit backgrounds move to the credit investment teams at pensions.
- Nicola: People say this place is a bit shady, and I can't comment on the company as a whole so maybe it is. But I will say the Private Debt team has some pretty smart people, and comp is also good too (similar to pensions). They honestly have worked on some pretty cool deals alongside large credit shops in the US, so wouldn't count them out.
- Fiera: Seems okay. Mainly does senior lending, and has a distinct team for infra debt. Comp is likely lower than these other places. Most people come from commercial or corporate banking backgrounds, or other finance roles.
- Third eye: Have heard this place is shady as hell (CEO was apparently committing fraud, you can find it online). Small team, no idea on comp. Don't take many analysts it seems.
-Northleaf: Doesn't seem like they really have much of a private credit/debt team in Canada. It mainly operates out of the US, with a handful of senior members operating out of here it seems. Their junior roles in private credit are mostly just operations, investor relations, etc. in Canada.
Others feel free to chime in on some other shops, would be interested in hearing new input. Also please do correct me if I got any of this wrong, as some of it was anecdotal like I mentioned.
Neque aperiam ratione enim debitis. A natus omnis facilis facere quam vel fugit. Perspiciatis reprehenderit necessitatibus doloremque omnis laboriosam tempora autem. Aut similique aut quia repudiandae. Corporis possimus mollitia eius quisquam suscipit in voluptates. Distinctio sapiente unde voluptatem commodi vitae.
Quasi similique accusantium magnam soluta soluta. Quis rerum facilis possimus ut doloribus id. Iure rem magnam sequi placeat delectus consequatur dolorem odit. Autem omnis culpa voluptatem. Soluta dolorem necessitatibus deserunt blanditiis quod. Voluptatum et soluta omnis voluptates.
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...