Big 4 Structured Finance to BB

bizguy24's picture
Rank: Monkey | 38

I recently just transferred to the Structured Finance Transactions Group at one of the Big 4 after working in audit for a year. I am 23, coming from a non-target school, already obtained my CPA, and will be sitting for the CFA Level 1 this December.

I just wanted to see if anyone had any insight on the exit opportunities for this group. My hope is to eventually obtain an structured finance job at a BB. Does anyone have any insight on how long I should stay in my position or what type of exit opportunities are possible. Thanks.

Comments (7)

Sep 6, 2013

Bump

    • 1
Sep 11, 2013

Leave earlier rather than later, people leave all the time to structuring, even within their first year. Just gotta make those connects.

Sep 6, 2013

Is it possible to move to the IBD of a BB after a year or 2 or am I limited to moving to the securitization division at a bank coming from the big 4?

Sep 30, 2013

For what it is worth, I am currently moving into the IBD of an Elite Boutique (Evercore, Lazard, Moelis, etc...) directly from a Big Four accounting advisory practice. I've been here a bit longer, but have a similar background. I was non-target, CPA, took/passed Level 1 CFA in 2013, etc. I'm moving over as a junior associate. It's definitely possible, but you just need the right network and experience. But, I'm not in a structured finance group now, so not sure how applicable all of this is.

Sep 6, 2013

Anyone else have any Insight on possible exit opportunities?

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Feb 21, 2014

I'm not sure what structured finance means at a Big 4 shop. If it means highly structured, non-cookie cutter debt and equity structures that can't easily be syndicated because they are non-cookie cutter, then I think your best bet is targeting those IBs which aren't constrained by regulatory requirements on prop positions. That generally means boutique banks with some balance sheet or IBs who aren't subject to some jurisdiction-specific restrictions on regulated banks taking prop positions (is this the Volcker rule? I don't know as my shop ain't a US regulated bank).

A problem you may face, at least in the US, is market timing. In my experience, structured debt and equity is most in demand when PE firms are looking for leverage but banks are reluctant to provide high levels of leverage. The problem you'll face is that, in this cycle, that part of the cycle saw its hey-day over 2010 - 2013. Today, the debt markets (particularly cashed-up CLOs) are now eating any LBO debt that banks can syndicate, which means PE funds aren't as desperate for bespoke hybrid mezzanine funding solutions as they were over 2010 - 2013.

Structured products experience highest demand when liquidity is tight.

On the other hand, I wouldn't be surprised if the market bifurcates in the next 6 months between (i) high quality sponsor + >$100m EBITDA LBO targets and (ii) EBITDA LBO targets. That means category (ii) faces tighter liquidity, which means structured products for those deals are more in demand. This implies that you should be focusing on IB teams who focus on the middle market and have access to some balance sheet who are willing to put that balance sheet into deals. Access to balance sheet is crucial, as even the GS of the world would struggle to syndicate highly structured products, hence must put those structured deals on their own balance sheet.

This is my view as someone who covers structured products and LBO debt in the US at a bank that is not regulated under US banking laws. There may be others with views on other niches in the structured product market who disagree.

Feb 22, 2014
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