Hello all, This Q&A is aimed at trying to give back to the WSO community. I interned in AM/corporate finance capacities, as well as marketing and account management. I also worked as a boutique analyst for a F500 company in their FI group. However, after all of this and some equity research/MM IB/ESOP IB offers I chose a career in Corporate Credit for a F50 company in the power/equipment financing sector of analysis. A lot went into this choice and I will be open to answering any questions about why I chose it/comp structure/upward mobility as well as what I do on a daily basis. I am a 2nd year analyst.
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How do you compare Corp Fin and IB recruitment ?
IB recruiting was honestly significantly harder. First the interviews: though both had case studies IB was a lot more involved with several interviews. My current company, had one phone interview, a skype interview and then a final round in office interview with 3 people an hour each, followed by a writing sample and mock spreads and analysis on a customer and a test using their systems to gauge knowledge. I received an offer the next day (all in process about a week and a half) whereas my process for IB took around 3 to 4 weeks to finally receive an offer.
In terms of actual leg work of getting that first interview for commercial and corporate banking I just submitted an application online from a post I saw on LinkedIn/Indeed, whereas IB took a lot of cold e-mailing and reaching out to different associates/VPs at a variety of shops and took about a month and a half until I started setting up any one on ones. I find many corporate finance/banking jobs on indeed that you can just easily apply for and have a pretty good shot at getting.
Did you find the technical questions harder for banking interviews?
How is comp structure. Do you see lots of people coming from IB/PE into your role?
Structure: 1st year credit analyst t1 pay bucket 2nd year credit analyst t2 pay bucket 3rd year credit analyst t3 pay bucket. 4th year - senior credit analyst
Pay: 3 years bonus target 9-15% 1st year 60,000-65,000 2nd year 65,000-75,000 (depending) 3rd year 70,000-90,000 Senior(dependent on performance 4th year-8th year)- 90,000-125,000 (bonus target 15%-25%)
After this you either branch off into credit management at a level 1 ($150k + 25% bonus) Credit manager for an entire region ($200k+30%) Continental Credit Manager ($350-400k+50%)
or
Risk Management Risk Management Analyst: $150k + 25% Risk Management Analyst: $175k +30% Corporate Portfolio Manager (MBA STRONGLY Preferred) $250k+50%
These are all rough estimates and the ranges vary. We do see some IB coming in to the risk management aspect of the business/management. One of our current Regional Credit Managers came from MM IB in an international financial hub. Though not often, a lot give up the 80-100 hour weeks for the 45 hours and 3-5 weeks vacation and 2 days/week remote work and sacrifice on the pay.
150k for a risk management analyst? Are those kids grad students or do they work long hours as well. What justifies that pay?
Thanks
this sounds like a fucking dream
Numbers seem pretty high. Is this for NYC/SF/Boston or another HCOL area? If this is Midwest, mind if I DM you? lol
.
Could you go in depth to why you chose credit?
Not going to lie, it kind of happened by accident at first. I was coming off of an internship in the corporate division of a F500 financial firm with a return offer, however, due to family issues I had to move back to the Midwest and get a job ASAP. So, a commercial bank reached out to me and said they would hire me and I could start the day after my flight landed so I took it and worked there for a year or so. They put me through extensive credit training and developed me rather quickly since I was one of three analysts covering a pretty high deal flow. This is when I was interviewing for IB roles as I was interested in the switch but then some other family stuff happened and I was not able to commit to any offers due to the long hours. After that, I ended up moving again for family reasons and again a commercial bank reached out to me this time more of a high volume sweat shop type of lending. Again another year here putting in long hours, and moved again to find the city I wanted to settle down in and this was the first time I actually sought out a credit role knowing I wanted to make a jump up to a much larger corporate financier. That is when I found my current job at a large corporate bank. Things have changed and I am looking to start a family now and the 80 hour IB weeks were not something I really wanted anymore. So now I get 3 weeks PTO work from home days, and decent pay. The pay will never blow you away but it is enough especially when you move up and I never work more than 45 hours a week and neither do the higher ups. Now I am just looking to move up into a higher role make the $150k-$200k a year and take an additional week PTO. Credit is definitely interesting and you get some basic modeling experience, specifically at a larger lender with more complex deals and it definitely is not mind numbing work.
I love the Corporate Banking content. Thanks for doing this.
From what I gather you are working at one of the largest banks in terms of asset size in their power/equipment financing group. F50 wording made it a little confusing so just clarifying. But, the hours and bonus level seem a little different than other Corporate Banking posts that state hours at the JPM/WF/BOA type banks are 60 on average and up to 80 during deal weeks. Can you comment on the difference between your bank and others in terms of hours? Your situation is actually the exact one I am looking for, as I would really enjoy the Corporate Banking work, without having to work 50-60 hours on average. If you wouldn't mind PM'ing me, or maybe replying here with names of corporate banks that offer the lower hours/lower pay structure that would be greatly appreciated. If you think that info is to revealing, no worries. Thanks again!
Hey, im really interested in CB do you mind if I PM you about your job?
Yeah go for it.
Could you walk us through a day in your life, and maybe touch on how your job differs from the smaller commercial credit you were underwriting at mid-west comm banks?
Thank you.
Typically I walk into the office at 8 A.M and go through any deals in my inbox and prioritize based on size/expected turn times. Then I go through and start spreading financials as I wait on our officers to provide all of the necessary information and get back my questions I sent out. (usually go through 10 deals submitting questions every morning) After this I start on the ones that get information back to me first and go into a few meetings before lunch. After lunch I usually have my questions answered and get a better sense of rush deals that I need to prioritize at this point and I start spreading financials/doing the analysis on the companies and then leave by 5-6 depending on the urgency of requests. The nice thing is that in terms of urgency things are much less urgent than at the community bank. Here, we have set turn times that are honestly extremely realistic whereas at the community bank we would be given 10-15 deals and have to have them in by our loan committee each Friday for review and approval whereas here I as well as my managers have quite substantial credit authority meaning you just drop it on their desk as soon as you finish for approval. This definitely helps to keep the pipeline clear and keeps work from piling up. After work I usually get home around 5:30-6:15 and just get to unwind. The difference is that in the community bank it was a lot of real estate analysis and small business RLOCS or Working Capital LOCS for a few 100k with one or two personal guarantors. Here I am working on more complex customers with several corporate guarantors and doing LOCS from $5mm all the way to $150mm in total exposure so the analysis is definitely more in depth and the global analysis and projections takes a bit more time but all in all the basic concepts are the same and at least here we get audited financials vs tax returns. One more thing was that the collateral here is a lot more tangible since we are talking about machinery purchasing vs taking F&E and A/R and inventory as our primary collateral.
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