ECM/DCM for Career Banking

I'm an incoming GCM intern at an American BB. I originally wanted IB but landed DCM and I've been thinking about my options as I start my career.

Initially I wanted to try to lateral to IB but it looks like I won't be able to do this until after my second analyst year, which, at that point, makes PE recruiting a long shot anyway. Plus, I'm not innately interested in PE, I just wanted to do what everyone else was doing.

So this left me with the thought of "career banking" (at least for now) in DCM. There are many benefits: IB-level comp, faster promotions, far better and more predictable hours. The only downside is zero exits.

How viable is a career in ECM/DCM? I always have the option to move to IB in my late analyst years or associate years (while still pursuing banking as a long-term career) or I can go to B school at some point (if I even make for a competitive applicant from DCM).

Any insight on a career in DCM would be helpful. Has anyone done this / know someone like this?

How is pay at the senior level? How is lifestyle at the senior level? Job security? Or is GCM a "dead end" that I should avoid at all costs?


Comments (48)

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  • Analyst 1 in PE - Other
May 24, 2020 - 12:16pm

I spent some time in DCM at a BB.

A career in DCM is very viable if you're interested in Capital Markets and macro trends. Your analyst year might be boring because the work is (very) repetitive (i.e. drafting market presentations, updating the same curves and pricing...)
Although, work is more fast paced because of the nature of capital markets and the facts that you might work on multiple new issues (deals) in the same week, whereas IB deals tend to be much longer to "close".

Most analyst tasks are automated through VBA macro/bloomberg link updates. Unless you're going on a high yield desk,** you will do no modelling. **

The only modelling I can see would be for a company acessing the bond market for the first time and not having a high yield profile (very rare though).
Also, no need to be a super analytical person, just need to be able to work in a fast paced environement.

As I said, work is repetitive in your first years, but your hours will be much better than your IB counterparts (my hours were 7am-8/9pm but I heard from other banks that DCM usually starts around 8am). You will still be tired from putting long/intense days of work but you will barely work on weekends.

Then comes the interesting part: associate and beyond. From my experience, associates were facing clients quite a lot and were doing fare less repetitive tasks than analysts. The hours tend to be slightly better but don't expect to work 35 hours a week either.
You will need to build strong social/sales skills and be able to convince your clients that they need to refinance/access capital markets vs loans or equity for example.

As you can imagine, you get more and more independant in you work going VP and above.

My last advice would be to get interested into different aspects of DCM, especially syndication as their job is, IMO, far more interesting and valuable than origination. You will get to spend a lot of time with buyside fixed income PMs as well as interact a lot with S&T from your bank and build relationship with syndication desks from other banks. Syndication people see the broader image and can basically move to any other job on buyside/sellside if they build a strong network (i.e. succeed at their job).

As for comp: generally same base as IB for analysts, since you'll be joining a BB you're bonus souldn't be that much lower than IB (if your bank is leading a lot of new bond issues). Not sure for associate and above, but might be slightly lower than for IB.

  • Intern in IB - Gen
May 24, 2020 - 12:39pm

Thank you! Super helpful.

I have some quick follow ups if you don't mind.

  1. Do you have thoughts on ECM? Most interested in equity-linked converts group but also interested in thoughts on traditional ECM. (work at the an/as level, lifestyle, comp, etc)

  2. It seems like you had great things to say about DCM but ultimately went to PE, which I'm thinking may have required some time in traditional IB. What made you want to move out of DCM and into IB/buyside?

  • Analyst 1 in PE - Other
May 24, 2020 - 2:09pm

1 - I have no insight on ECM apart from what I read on WSO... DCM probably has a way better lifestyle than ECM in term of hours though. Comp is really bank dependant again, if your bank is lead bookrunner on most deals then you can make more than certain IB groups, if your bank only take a small-ish chunk of a few deals then you'll make no money

2 - I spent a summer in DCM then ultimately went to PE fulltime thanks to heavy networking (and prior PE internship). I enjoyed DCM because i had a lot of "responsabilities" as an intern and my group had a great culture but when I got the PE offer I took it without a doubt.

Jul 6, 2021 - 7:11am

Hello, thank you for your sharing, it is very helpful.

I'd also like to know the requirement of joining DCM, like the level of coding math, like do we need stochastic calculus, black-scholes level of maths?

Another thing I'd like to know is about exit, can you share a bit more on that? Do you have friends from DCM move to buy side ? I'm looking for exit that with better hours, does not matter if the pay is lower.

Thanks in advance.

May 24, 2020 - 2:17pm

If you're looking for career banking, DCM is where it's at. Yes, a traditional IB group can be better pay, exits, etc, but if you WANT to stay, those groups will burn you out, unless you're a psycho. Therefore if you WANT to stay, DCM is an awesome job where you're less likely to be losing your fucking mind from working 80h a week. It's a great option for some.

May 24, 2020 - 4:30pm

Basically the same until VP, then starts to deviate a bit. However, on a post-tax basis, it's not as big as you'd think + you never work weekends and are way less stressed. Your priorities may shift as you get a bit older.

  • Analyst 1 in IB - Gen
May 24, 2020 - 2:30pm

Is DCM generally regarded as better in relation to job security and exits compared to ECM?

  • Analyst 1 in IB-M&A
May 24, 2020 - 2:38pm

From what I understand, slightly / not really. Exits shouldn't be included in the discussion because the only capital markets group that will have legitimate exits would be lev fin (which most banks have in IB, anyway. not DCM). Job security may depend on the bank and their typical deal flow (i.e. mine does a ton of equity with good lead roles but not so much with debt), although debt is more "recession proof" than equity in most cases

May 24, 2020 - 4:35pm

"Legitimate exits" according to WSO standards. Legitimate is subjective. I wouldn't call an exit as CFO or head of capital markets at a blue chip as not legitimate. It is true that you will not get into PE or HF from DCM, 99% of the cases. However a DCM banker will develop relationships way earlier than an M&A banker and can have very good exits later in the career based on the relationships developed. Regarding recession proof, DCM is having its best year ever in the US and the IBD of every decent bank will have to thank the poor DCM fellows at the next bonus round.

May 24, 2020 - 4:38pm

my advice while you are still an analyst - lateral to loan capital markets / loan syndication / lev fin / lev fin capital markets
double skillset - Loans n bonds
creates exit ops bc greater skillset (Credit finds etc)
that way u have 3 avenues in your future
LCM - Loans
credit fund

May 25, 2020 - 2:47am

loan capital markets doesn't fall under CB.
it is many times just named differently but all the same thing (loan syndication etc).
all banks have this group I'm pretty sure. if u know otherwise, I'm happy to hear.

yeah CB guys have 0 skillset. but u get your foot in the door so better than nothing.

  • Associate 3 in IB - Gen
May 25, 2020 - 10:16am

I worked in ECM for 3 years at a top bank and it was awesome, but you won't build any skills for PE (which is why everyone leaves). It was also very binary, you were either not doing much leaving at 5-7pm, or you were there until midnight (keep in mind capital markets jobs are 8am arrival). Everything depends on the bank, the JPM HC ECM team is ~10 people alone, which is massive. At GS, it's Consumer, Retail, and Healthcare grouped into 1 ECM team, etc. If your bank isn't top 10 in the league tables you probably aren't doing much and making that much money though. So if you're going capital markets it has to be at a BB or else you don't see many deals...

Comp is the same as traditional IB for base, with a slight haircut for bonuses at junior levels. MDs are still making 7 figures though...

  • Intern in IB - Gen
May 25, 2020 - 10:42am

Thanks this is super helpful.

Do you have thoughts on ECM vs DCM? Have been considering DCM (corporates) or ECM (converts) for full-time.

Where did you go after ECM and why?

May 25, 2020 - 3:16pm

I am generalizing, but DCM is more technical, less volatile in terms of job security, and more interesting (subjective). DCM IMO has better exits because of 2 reasons: 1) Debt market is wayyyyy bigger than equity market 2) DCM is more technical --> better skillset for the buy-side (Not for PE, for credit/debt funds, mezz funds, AMs like John Hancock, Fido, Welly, and some distressed HF).

  • Intern in IB - Gen
Jun 15, 2020 - 7:13pm

Dude stop asking specifically about Goldman, hours are probably very similar across the street (and this guy just gave you JP hours which is also a top-tier). He's saying that healtcare and c&r are covered by the same ECM team. It's common for banks to couple industries for ECM teams since deal flow is limited to equity

  • Analyst 3+ in PE - Other
May 25, 2020 - 4:36pm

If you are in western market, DCM is good for being career banking. ECM is too volatile

Neither if you are based in Asia

  • Intern in IB - Gen
May 25, 2020 - 9:54pm

Would love to hear from ECM people too. Not sure if DCM people are biased about their preference for the debt side

May 25, 2020 - 10:29pm

it's not that I'm biased, it's just I know nothing about ECM - so I have no view.
but yes - taking that aside, definitely some bias for the debt side. hey what can I say, I'm a loan boy! we like what we like

May 26, 2020 - 12:32am

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