Hey everyone, one of my friends has a superday with JPM's CIB Credit Risk program coming up, and just wanted to know what to expect/how to best prepare. What will the technicals be like (similar to banking or more of a focus on credit)? Are the behaviorals just the standard behaviorals? Anything else to look out for? Thanks in advance!
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Expect technicals to be mainly focused on credit, even though you could also get a few basic IB technicals.
Hey thanks for your response. What kind of credit technicals should be expected? And by basic IB technicals do you mean stuff like basic accounting and valuation, etc. (My friend is in a liberal arts program with limited prior accounting/finance knowledge)
bump, would appreciate any other insights
I would know a few different financial ratios and/or common covenants. I work in Oil&Gas corporate banking for instance, and we typically see a max debt/ebitda (aka "leverage") covenant of 4.0x and a maximum current ratio covenant of 1x, which are tested quarterly. I have to think most secured facilities in every industry contain some sort of cash flow and liquidity ratio test so brush up on what those are. I think for Credit Risk it will mostly be qualitative, but it wouldnt hurt to brush up on the basic IB and accounting technicals like "walk me through the 3 financial statements" "how do you get to free cash flow from net income"... stuff like that.
Learn the 5 C's of credit and be able to drill down and speak about each C for 1 minute or so.
Understand that a bank will never lend without at least 2 ways of getting paid back. The primary way is always cash flow from operations, in that we will never lend if the company's cash flow cant repay the loan in an adequate amount of time. The other ways of getting paid back vary but usually include asset sales or refinancing in the capital markets
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