by Brian DeChesare Comments (110)

All About Leveraged Finance – from a Director in the UBS Leveraged Finance Team

Businessman and Dollar Sign Balancing on a Seesaw
It’s finally here – that Leveraged Finance interview you’ve been asking for since we started this interview series.

Unlike every other interview on the site, this one is not anonymous – it’s a discussion with Josh Pearl, a Director in Leveraged Finance at UBS Investment Bank and co-author of a great technical reference guide, Investment Banking: Valuation, Leveraged Buyouts, and Mergers and Acquisitions.

Most of the other interviewees have been at the analyst or associate level, so I wanted to publish this one and get a crash course in all things Leveraged Finance straight from a senior banker.

The Disclaimer

Since Josh works for a publicly traded company and since this is not an anonymous interview, there are certain topics that we could not discuss here (which will become apparent when you read through it).

It’s still a great interview and you will learn a lot, but please be aware of this before asking about why a certain topic was not covered – in all likelihood it’s because we could not discuss it due to the circumstances of the interview.

Q: Josh, thanks for taking the time out to speak. Can you give us a quick overview of how you got started in the industry and how you ended up at UBS?

A: Sure. I received my undergraduate degree from Indiana University’s Kelley School of Business and began my investment banking career at a regional firm, A.G. Edwards, which eventually became part of Wachovia (and therefore Wells Fargo).

While I enjoyed my brief time at A.G. Edwards, I wanted to focus more on developing my technical skill set and I was very interested in leveraged finance. I became interested in leveraged finance after reading books such as Den of Thieves and Barbarians at the Gate. I wanted to understand how leveraged buyouts and high yield financings actually worked.

I contacted a prominent Indiana alumnus who was the Head of Leveraged Finance, Americas at Deutsche Bank at the time, arranged an interview, and ultimately moved to DB. After spending five years at DB, I moved to Capital Markets at Moelis & Company, a boutique investment bank founded by former UBS Investment Bank President, Ken Moelis.

While Moelis is an incredible firm and I’m still close to my former colleagues there, a couple of my old DB colleagues moved to UBS and my co-author, Josh Rosenbaum, is there as well, so it made sense for me to join. Currently, I’m a Director in Leveraged Finance at UBS, primarily covering industrial companies.

Q: Right, that story shows the value of networking for anyone else who’s thinking of making the move from boutique / middle-market bank to bulge bracket.

What exactly do you do in the Leveraged Finance team?

A: Broadly speaking, in Leveraged Finance, we structure and execute leveraged debt financings for corporate and private equity clients and then seek to source investors for those debt financings.

So let’s say that a chemicals company is looking to acquire another company, and they want to explore financing options.

Ideally, the company is an existing client and we have a fairly regular dialogue – in this scenario, we would present different alternatives to them, focusing on different types of debt they might raise – bank debt, high-yield debt, etc. – and then show how each alternative would impact their existing capital structure and operations.

If they decide to actually go through with the deal and raise debt, we would market the offering to debt investors and help them raise the capital.

It’s similar to the IPO process, but deals can be done faster as leveraged debt offerings are typically initially sold to large institutional investors, known as qualified institutional buyers.

Q: And for anyone unfamiliar with the types of debt, can you briefly explain the difference between “bank debt” and “high-yield debt”?

A: Sure. First off, it might be more accurate to call bank debt “senior debt” or “senior capital” and high-yield debt “junior debt” or “junior capital.”

The basic differences are that more senior debt typically has lower interest rates, a higher claim to the company’s assets, and maintenance covenants rather than incurrence covenants.

Maintenance covenants require the borrower to “maintain” a certain credit profile at all times through compliance with certain financial ratios or tests on a quarterly basis. For example, the company might have to maintain Debt / EBITDA below 5.0x or 6.0x at all times.

They are also designed to limit the borrower’s ability to take certain actions that may be adverse to lenders (e.g., making capital expenditures beyond a set amount), which allows the lender group to influence the financial risks taken by the borrower.

Incurrence covenants only prevent the issuer from taking specific actions (e.g., incurring additional debt, making certain investments, paying dividends) in the event it is not in compliance with a “Ratio Test,” or does not have certain “baskets” available to it at the time such action is taken.

There are other differences as well: for example, interest on more senior forms of debt is typically “floating” (i.e., it can change over time) and is tied to a rate like LIBOR, and more senior debt often has some amount of amortization built in, whereas junior debt does not.

Senior debt also tends to be secured by collateral (though that’s not always the case), and has a lower “tenor” (maturity period).

Finally, both types of debt appeal to different types of investors: more conservative banks will go for senior debt, whereas hedge funds, merchant banks, and mezzanine funds will be more interested in junior debt with more risk but also higher potential upside.

Our job in Leveraged Finance is to help clients look at the trade-offs of different types of debt, recommend the best course of action, and then find investors to fund the deal.

Recruiting & On the Job

Q: How is recruiting different for leveraged finance groups on Wall Street compared with other groups?

Is there anything in particular you look for in resumes or in interviews?

A: Many of the analysts and associates who interview for leveraged finance groups see it as a pathway to securing a buy-side job, so it’s one of the more competitive groups to break into at banks.

If you’re just interviewing for a generalist position and you’ll select your group later on, there’s not too much specific to leveraged finance you’ll be asked at the interview stage.

However, if you’re interviewing for a leveraged finance team specifically, you will likely be asked more technical questions – everything from accounting to valuation, capital structure, and LBOs.

Interviewers do have certain expectations of your existing knowledge; for example, I might not ask a liberal arts major quite as many technical questions, unless I see that he/she is very well prepared for the interview.

There are two reasons for this:

  1. Technical questions are a great way to screen people – A lot of times it’s hard for us to tell who’s serious and who isn’t just by asking “fit” questions. But if you can’t learn enough on your own to answer questions about an LBO model, for example, you probably won’t be a good fit for leveraged finance.
  2. The resources are out there – Years ago you might have had trouble learning all this on your own, but today there are plenty of books, websites, classes, and training programs teaching these leveraged finance and capital structure concepts. So there’s no reason why you can’t learn it before interviewing.

Q: What is the difference between a capital markets group and leveraged finance group? I’ve gotten dozens of questions on that one.

A: It depends a bit on the bank and the groups, and sometimes they can be quite similar.

But the general differences are as follows:

  • Capital Markets: Focuses more on tracking market activity, key trends and terms, and communication with investors. They assess the tone of the market and serve as the liaison between bankers, traders, and the sales team. They also assess market appetite for particular financing constructs.
  • Leveraged Finance: Focuses more on structuring, credit analysis, and client interaction – i.e., devising financing scenarios, performing due diligence, and communication with executive-level individuals at client companies. You usually get more modeling experience at the analyst/associate level and work with your team to ascertain whether a particular proposed capital structure works, given a company’s financial projections.

Q: So let’s say you’re working on a debt issuance for an industrial company under an LBO scenario.

What would the analyst in the industrials group do, and what would the analyst in the leveraged finance team do?

A: Generally, the industry analyst focuses more on due diligence, the company itself, and assumptions behind an operating model for that company.

The leveraged finance analyst would look at the debt side, crunching numbers, focusing on the credit profile of the issuer (credit statistics, debt repayment, etc.), as well as analyzing IRR and cash returns to the sponsor.

A large part of our job is centered on deciding what type of capital structure is most appropriate for a particular scenario, and what package would be most appealing to the company, the sponsors, and the ultimate debt investors.

For example, does a cash flow revolver/term loan/senior notes construct make sense or would an ABL/secured notes structure work better? Could we do first lien/second lien? Which one is better for the company, and which one will investors be more likely to buy?

An analyst would build a model to help answer questions like these and then offer insight on the various scenarios so we can make the best recommendations to clients.

Q: Right, that makes sense. What about the culture of leveraged finance groups compared with others at a bank?

A: It’s difficult to say, but my experience is that the culture at most banks is very similar and somewhat cliché: work hard, play hard.

Leveraged finance and most investment banking groups on Wall Street require long hours and hard work, and everyone has the same goal of providing the best possible advice to the client.

In my group, we do try to spend time out of the office together and we do have late Friday afternoon beers and pizza – little things like this go a long way in maintaining morale and developing a strong group dynamic.

That said, I don’t think there’s much unique to leveraged finance that you wouldn’t see in other groups – it really comes down to the people in your group and how well you work with them. At the analyst/associate level, it is important to seek out mentors, whether formally assigned or not, to help guide your career.

Q: What about the typical work hours, especially at the junior levels?

A: Banking is banking – expect the typical 80-90 hours per week, sometimes more, sometimes (rarely) less.

Analysts in more capital markets-related roles might not work quite as many hours as those in traditional corporate finance because they follow market hours – but you’re still looking at 12-hour days at the minimum (and sometime much more), so it’s far from a 9-5 job.

Capital markets analysts are in the office early and their days are pretty much non-stop action.

Q: You mentioned before how many analysts in your group desire to move to buy-side roles – what are the most common exit opportunities?

A: Well, obviously, we seek to keep the best and brightest analysts by promoting them to the associate level.

However, it has become a norm that analysts seek to move to private equity, hedge funds, or mezzanine funds. Some choose to move to business development positions in corporations, start businesses of their own, or pursue graduate degrees.

Note: “Mezzanine” above refers to a layer of capital that lies between traditional debt and equity. Mezzanine is a highly negotiated instrument between the issuer and investors that is tailored to meet the financing needs of the specific transaction and required investor returns.

As such, mezzanine debt allows great flexibility in structuring terms conducive to issuer and investor alike.

Typical investors include dedicated mezzanine funds and hedge funds. For the investor, mezzanine debt offers a higher rate of return than traditional high-yield bonds and can be structured to offer equity upside potential.

The Book – Investment Banking: Valuation, Leveraged Buyouts, and Mergers and Acquisitions

Q: So far your book has been very well-received – what motivated you to write it in the first place?

A: Most of the accounting, valuation, and financial modeling textbooks out there were written by finance professors and have much more of an academic focus. A lot of professors that publish finance textbooks are trying to advance the field of finance by devising new approaches or attempting to solve perceived issues.

This can make it confusing if you’re new and trying to learn the basic concepts. During our research and writing process, we referenced numerous finance textbooks and worked with several of the top finance professors in the world, so we have the utmost respect for academia.

However, we wanted to focus more on how you value and model companies in the real world – and there was no book that walked you through the primary valuation methodologies in a logical, step-by-step manner. We wanted to fill the void in current finance literature and make the knowledge available to everyone.

Q: Right, so what has the feedback been like so far and who’s using your book as training material?

A: So far over 50 undergraduate and MBA programs are using it that we know of, and numerous investment banking training programs have adopted as well.

The feedback we’ve received from everyone from juniors in undergraduate programs to some of the best hedge fund managers and private equity partners in the world has been outstanding and very encouraging.

Q: What level of finance knowledge do you need to get started? Is this a guide that someone can go through at the last-minute and quickly get up to speed?

A: The original intended audience was liberal arts majors as well as those with undergraduate finance and MBA backgrounds seeking to break into investment banking – it’s a crash-course in accounting, valuation, and modeling that anyone can look at and learn quickly. All the basics are in the first chapter, and after that it gets progressively more difficult.

We’ve had dozens of success stories from students at liberal arts colleges, including readers who landed offers at bulge bracket firms with minimal finance training.

Q: Great, thanks for your time and for sharing your experience in Leveraged Finance and writing the book. Everyone should check it out right here on Amazon.

A: Sure thing – enjoy reading and your readers can contact me at with any questions.

M&I - Brian

About the Author

Brian DeChesare is the Founder of Mergers & Inquisitions and Breaking Into Wall Street. In his spare time, he enjoys memorizing obscure Excel functions, editing resumes, obsessing over TV shows, traveling like a drug dealer, and defeating Sauron.

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  1. i am currently a corporate banking analyst at a top 4 BB (think JPM, BofA, WF, Citi) and i am looking to eventually make the move to a BB leveraged finance position. my current role is more commercial banking than investment banking. i have an IB job offer for a debt capital markets analyst position that is focused on private placements at a somewhat smaller bank (think HSBC, BNP Paribas, RBC). do you think this a good stepping stone to a BB LevFin role? if not, what other paths would you recommend?

    1. Yes, it’s possible to use that role to move into Leveraged Finance at a large bank. If that’s the best offer you have, take it, as it will become harder to move over to LevFin the longer you stay in corporate banking.

      1. thank you for your prompt reply. i am also interviewing for a leveraged finance position at a much smaller European bank (think ING, ABN AMRO, Credit Agricole). which path do you think is the best/quickest way to a BB LevFin role: the DCM Private Placements role or the LevFin role?

        1. LevFin at a smaller European bank is better than DCM at a smaller bank.

  2. Hi Brian,

    What is your opinion on Capital One’s healthcare lending group? They are the #1 arrangers and underwriters for the Healthcare industry. But they seem to be more on the commercial side than your typical leverage finance at a BB shop. Do you think a Leverage Finance experience at Capital One would lead to PE?

    1. I don’t know enough about it to give an informed opinion. However, Capital One in general is more on the commercial banking side than the investment banking one. So I think it would be challenging to move into PE directly, though you could potentially get into buy-side credit roles (e.g., similar work to PE but investing in credit instead) from there.

  3. I love financial analysis and modeling. I can’t help but feel like enjoy myself the most in a group with heavy emphasis on technical skills (i.e. builds complex models from scratch).

    When networking, I hope to find a group like this, but it does not seem appropriate to ask about this directly.

    From what I understand, bankers like to see that I’m not a nerd who comes to banking for mental satisfaction, because then banking is not right for me. They also want to see that I am an obedient workhorce who will be happy in whatever group they put me in.

    How should I bring up my interests and start a mutually enjoyable discussion on how the group will satisfy those interests (in this case, financial analytics. Lev-fin looks like heaven if I only go by the way it was described in your post)

    1. OK, so first off, you rarely do anything super-technical or quantitative at a bank. Yes, LevFin is more technical than other groups, but it’s still a fair amount of memo writing, copying/pasting information, etc. There is modeling work, but it’s not as if you’re coming up with a new theory in physics or math.

      With that said, you can portray your interest as more like: “I’m very interested in debt-related deals because more analysis is required and you do more work with different types of financing, so Leveraged Finance interests me the most.”

  4. I am currently an analyst in a MM/Corporate lending role at a top 3 lender (JPM, BofA, WF). How easy would it be to move into a LevFin or M&A role at a top BB? What steps should I take to make the move? My group mostly does revolvers and some term loans. I don’t get to do much modeling either.
    My ultimate goal is to end up either in PE, Mezzanine, or a similar private debt role at a well-known fund manager.

    1. It’s possible, but you’ll need to network a lot and most likely go to a smaller bank first. I think it would be very tough to get into a BB from a non-IB background. If you do mostly Revolvers and Term Loans, it’s best to aim for DCM groups at smaller banks since they deal with investment-grade debt, and then think about moving somewhere else after.

  5. Hi,
    Apart from LBO models, what else is required of LevFin analysts? Are there any models that are specific to LevFin groups? I’m in an industry coverage group but want to improve my understanding of what happens in LevFin.

    1. You can look at many of the analyses detailed here as well:

      We’re also covering bond analysis and how to calculate different yield metrics in an upcoming BIWS case study. It’s not rocket science, but you do go more in-depth into different features of bonds in LevFin, such as calls and puts, make-whole provisions, and so on.

      1. Hi Brian,

        Do you have a link to the BIWS case study covering bond analysis and calculating different yield metrics? I’m not sure whether this is something one should be expected to know for a LevFin interview.

  6. Thanks – the role says it will include due diligence, modelling, credit applications and assisting senior bankers in the deal so I guess broadly similar. Is there anything in particular you would recommend brushing up on for the interview? It is for a graduate entry level scheme in London.

    1. M&I - Nicole

      Understanding the basics of valuation, and credit analyses would help. I’d also brush up on your pitch – why you want to be involved in the role.

  7. Hi – great article and really useful to read. I have an assessment centre for a leveraged finance role next week with a European corporate bank that as far as I’m aware doesn’t have an investment banking division per se. Would the content and role differ vastly from that of lev fin in IB?

    1. M&I - Nicole

      I’m not 100% sure but I’d check the job description of that particular role. I’d think you’d still be dealing with corporate clients so perhaps the work wouldn’t be too different, but it depends on the bank and what you’ll be doing there.

  8. Great article and thanks for putting the time and effort into sharing information. I have a few question, if one is not entirely sure what their long-term plans are, would it be wiser to start in an industry coverage team or LevFin (strong team)? Think Deutsche/CS Also, would it be considered easier / easy to move from M&A/industry (good deal flow) to LevFin and vice versa, say in the first 1-2 years of one’s career? Lastly, with regards to MBA does one place better than the other and the same for PE (perhaps growth)? I would appreciate if you could provide me with your view on each question. Many thanks in advance.

    1. M&I - Nicole

      Tough question. I’d say levfin though if you’ve got an interest in a particular industry an industry coverage team may help too. It also depends on how strong your bank is in that particular area. I’d say levfin maybe better if you want to move into PE though I think its hard to say because it really depends on your team, the work you’ve been exposed to, and your experience/background should help

  9. Hi
    I have a LevFin interview with CS next week, what type of questions should I be related for?

    1. M&I - Nicole

      If you’re interviewing for a leveraged finance team specifically, you will likely be asked more technical questions – everything from accounting to valuation, capital structure, and LBOs.

      1. Where can I find resources on Capital Structure? Thanks

        1. Take a look at some of the book recommendations above; you can also find a lot just on YouTube.

          We have a few videos on topics like Cost of Equity, WACC, etc. as well:

  10. Thank you for the article. What investment banking group tends to make the most in bonuses on average? M&A seems pretty lucrative, but given the frequency of debt offerings do LevFin members make more?


    1. M&I - Nicole

      It is hard to say. I think it depends on your team, your bank, and your performance. I don’t have the exact stats across industry groups so I cannot say.

  11. Is it possible to move from DCM Origination to Leveraged Finance. If yes, how hard do you think it would be for junior with 1-2 years DCM experience?

    1. M&I - Nicole

      Yes it is. 1-2 years is ok, I think what you need to demonstrate is your deal as well as valuation experience so if you can try to be staffed on more deals and do more valuation work this will increase your chances

  12. Hi!

    I have an interview next week in IB (structured finance), and I will be asked questions about corporate credit risk. Do you have any advice for me? What type of questions should I expect on credit analysis?

    Thank you!

    1. M&I - Nicole

      I am not 100% sure, though you may find these articles on structured finance useful:

  13. I’ve been browsing on-line greater than 3 hours today, but I by no means located any interesting guide like yours. It is pretty worth enough for me. In my view, if all webmasters and bloggers made excellent material material as you likely did, the net will probably be much more useful than ever before.

    1. M&I - Nicole

      Thanks for you input! I’m glad you find our guide useful!

  14. Very insightful – as always.
    I was wondering how difficult and meaningful it might be to start in a LevFin group and move to M&A / ECM / industry team after about 2 years in order to get a broader exposure and keep the learning curve steep. Yes – your article about choosing groups / teams within the IBD is also great.

    1. M&I - Nicole

      Yes you can move from LevFin to M&A / ECM; I’ve seen this happen with a contact – he moved from LevFin to ECM to S&T –

  15. Any idea on the best leverage finance groups , Deutsch bank is high up on the list and so is JP morgan but i read on WSO that in JP you tend to work in the corporate loans group and not related to the sponsors or something

    1. It changes from time to time, but generally banks with the biggest balance sheets are best… not sure about JPM but they are almost always #1 or #2 in the LevFin league tables.

  16. Do leveraged finance analysts/associates get involved in legal minutiae (i.e. drafting Term Sheets and contracts, verifying conditions precedent to disbursement, getting credit approval in the case of bank debt, etc.) or is it just analyzing and defining the structure and lawyers and/or other people execute the paperwork?

    1. It is more the analysis, the legal terms are handled by lawyers and/or by other people on the team.

  17. Hello,

    I’m interested in understanding how debt fuels growth in companies, and to what extent continued borrowing is sustainable for healthy growth…
    In the far future I consider working for IMF or World Bank. Would starting out (I’m an undergrad)in leveraged finance be helpful towards the perspective I want to develop? I know that DCM is another group that deals with debt, but I’m not interested in the sales and trading aspects of it.

    Thank you!

    1. M&I - Nicole

      Yes it can be helpful especially if you’re not interested in the S&T part of it

      1. Building on top of that I’ve learned that even some bulge brackets in their lev fin teams don’t do much modelling, and are more of a capital markets group. I’m interested in modelling and corporate finance aspects of LevFin. In that regard should I try to avoid banks that are more levfin capital markets focus? Also how would my experience and exit opps vary?

        1. M&I - Nicole

          You can say that. In terms of your experience and exit opps people move to private equity, hedge funds, or mezzanine funds. Some choose to move to business development positions in corporations. It’s hard to predict your exit opps so its best for you to come back to us after you’ve received a few offers so you can then choose and decide. Otherwise, I’d go with what you currently have

  18. No questions on models and bottles lol?

  19. Hi Brian, Josh,

    I’ve read with great interest the book and got a lot of answers to my PE questions. However, the issue of fees that banks pocket for their PE-related activities is not detailed. You mention arrangement fees, underwriting fees, etc… Could you please let me know what fees IBanks receive and what fees lending banks receive?

    Also, from what I read, IBanks do not provide any financing, rather they connect the sponsor to the lending orgs: is that correct?

    Thank you. EM

    1. It really depends on the deal and the bank. Financing fees tend to be higher than advisory fees… on a sub $1B deal, financing fees might be ~3% of the total debt raised and advisory fees would be more like 1%, maybe a bit more as you scale down. On deals bigger than that, fees scale down percentage-wise as you move up in deal size.

      Banks do provide financing, especially the bigger banks with large balance sheets.

  20. Brian – are there particular courses or parts of your courses offered that would be most relevant in preparing for LevFin interviews?

    Assuming Financial Modeling Fundamentals would be a good start but was just curious if certain parts of the course would be more relevant than others, and also if the advanced course would be overkill or not.


    1. Hmm, probably the LBO modules in both the Fundamentals and Advanced courses are most relevant for LevFin. You should understand the basics of the rest, but valuation/merger models and so on are less relevant for LevFin.

      Advanced Course: I wouldn’t say it’s overkill necessarily, but I wouldn’t jump into it right away especially if you’re learning the fundamentals right now. If your group is very technical and builds all models from scratch, the Advanced course is a wise idea.

  21. Hi Brian,

    Would like to seek your advice on how should one position in a leveraged finance interview? Are there any solid reasons you would recommend in his ‘story’?


    1. M&I - Nicole

      Perhaps you have spoken to someone in levfin, or you’ve done a deal that is relevant to leveraged finance/would have been better off if the company used debt financing. This can be a spark that led you to pursue levfin. You’ll also need to demonstrate that you have the modeling know-how – you will likely be asked more technical questions, everything from accounting to valuation, capital structure, and LBOs, because leveraged finance is more technically-focused.

  22. Hi,
    What are your thoughts about a leveraged finance group that specifically focuses on energy, given that it’s the banks strong suit. Would a generalist levfin experience be more practical?

    1. M&I - Nicole

      Depends on what you want to achieve. Perhaps the generalist role can open you more doors but then it depends on your goals

      1. I know it’s generic, but my goal is a larger pe fund. Would it be worth going to a weaker lev fin group at another bank given that I’m a generalist or go with the nat resources group with strong deal flow?

        1. M&I - Nicole

          I’d choose the one with strong deal flow.

  23. Great article – keep up the good work!
    I am currently working for a major British bank in Credit Analysis covering large corporates and will soon move into acquisition finance for a 6 month stint. Do you think I have a shot at moving into leveraged finance afterwards although our acquisition finance department covers mostly non-leveraged loans for acquisitions/restructurings/capex?

    1. Possibly, but you’ll need to show that you have the modeling know-how and experience to make the move.

  24. I could not add this comment to the article on wardrobe for men , so I just put it here.

    I start my full time IBD job at a London based BB next monday.
    I managed to get hold of a MD for a breakfast this wednesday regarding advice on what department/group to choose.
    How should I be dressed for this?

    Also when starting to work, should I be shaved completely? Or is shaving with an electric razor enough? The difference is maybe 1 mm.


    1. M&I - Nicole

      I’d wear a suit to be safe though business casual is acceptable.

      Yes looking clean, hygienic and smart will help you at work!

  25. Isn’t Credit training relevant to Private Equity? Since PE transactions involves a lot of debt.
    i.e. PE Distressed loan investing, Mezzanine capital, Distressed/Turnaround PE, Leverage finance (LBO), etc…

    1. M&I - Nicole

      Yes they can be related to PE

  26. Hey Brian,

    This is more of a general question that pertaining directly to leveraged finance, but for exit opportunities is it generally better to be the product groups like LevFin or to be in industry coverage? I understand that it probably depends on whether you are trying to get into a particular industry focused private equity group or hedge fund or are doing something more general, but is there a general consensus?

    Thanks. Love the website. I have learned more here than anywhere else.

    1. M&I - Nicole

      It depends on where you want to be and where your passion lies. If you have a particular interest in an industry, I’d go for industry coverage roles. Industry focused funds – having experience in relevant industry groups will help.

  27. I’m a graduate of Finance, Nigeria. All what we are taught through out our years in school was theoretical aspects of Finance. Pls can you recommend to me any website where one will be able to get practical knowledge of Finance courses?. Thanks.

  28. Can a completion of a formal credit training program lead to getting into IBnkg (i.e. Restructuring, Structured Finance, Debt Capital Markets, Distressed Assets, Credit Research, Structured Products, Leverage Finance, Hedge Funds, etc.)

    1. That’s probably not enough by itself, no. You need work experience, networking, school/grades etc.

      1. Hi Brian,

        Are there independent vendors offering a credit training program similar to the ones that banks use ? I think I can better utilize my time going through one while I am job hunting.

        Thanks Brian!

  29. Hey Brian,

    Hi relevant is the type of credit analysis done in commercial banking to leveraged finance? Is it conceivable to move from CB over to leveraged finance?

    1. It’s somewhat relevant, so yes, sometimes people do move over from CB.

  30. Hi,

    I wanted to get your view on how easy it is to move from LevFin at a BB to PE, on the equity/investment side? The reason I ask is that the majority of PE guys tend to have more M&A type backgrounds.

    Also, what about growth capital funds, where debt experience isn’t directly relevant, but there are transferable skills such as modelling, financial analysis, due diligence analysis etc etc?


    1. Happens a lot, not so much at growth capital funds as the companies are different but definitely on the PE side

      1. Oxbridge-mule

        Hi Brian. Sorry to jump in however, for means of clarification, are you suggesting that whether candidate A was to start of in LevFin (strong group with great street rep) and candidate B in an industry group (strong-ish group) they would both get the same opportunities to work on EQUITY side at top MM/MF PE (disregarding brand of BB)? If so, does LevFin have any leverage or are you limiting exit ops considering you can’t even work in industry focused PE firms (I don’t know whether majority of firms are industry focused) Plan would be to NOT stay on credit side after period in LevFin.

      2. Oxbridge-mule

        Sorry, I didn’t make myself clear. Would you rather be candidate A in the situation or candidate B? Your goal is PE equity side at top MM/MF until B school. After that, either back to PE or entrepreneurship. NOT credit.

        1. I don’t know if there would be a big difference. Candidate A is probably better if he/she doesn’t have a preferred industry and just wants to do PE more generically, but B is better if he/she knows the industry he wants to be in long-term. People tend to exaggerate these types of differences, though.

  31. Hi

    I will actually commence a graduate role in a top tier european IB for lev fin in the autumn.

    However would like to ask about the opportunities to move towards the high-yield/structured credit trading roles that may be closely related to lev fin.

    Mainly asking becuase always want some exit plan incase I do not enjoy lev fin. Cheers

    1. Honestly not sure about that one but I think IB to trading is doable even if uncommon

  32. Hey Brian,

    Everyone wants to do PE at a mega-fund post IB. Obviously the higher pay, reduced hours, and prestige are the biggest factors that goes into that decision. But what about capital markets within these mega-funds. Do you know anything about the opportunities that are available post IB for this position? Do you have info on salary, hours, and the typical candidates that these groups normally hire? Thanks!

    1. Not sure but I believe they mostly hire from capital markets teams at banks (ECM/DCM). They are very small groups even at the mega-funds and I would assume that pay is less, hours may be less brutal as well though.

  33. Hola,
    My computer won’t let me comment on your article about the CFA, but I had a question regarding it. I’m assuming its not a neccesity, but would it be a good idea for someone going into PWM to take the exam?

    1. More useful than in banking but not sure offhand whether it’s required there

  34. Brian,

    Thanks for the interview, it was really informative. Although the interview highlighted the different aspects of the lev fin group at UBS; the interviewer did not mention how lev fin groups might be structured at different banks compared-not that he’s expected to know anyway or maybe he could’t talk about it. My point is, banks like BAML and JP Morgan I believe structure there lev fin groups differently, Whether that be handing off LBO models to there sponsors group or not modeling at all. The reason I ask is because most prospective analyst are gunning for the more prestigious lev fin groups (might not be the best way to think but it’s the fact) like the ones aforementioned. I would definitely like to hear your take on this, particularly JPM if you have that info. Thanks!

    1. I don’t know offhand but we will be covering a few different LevFin/DCM angles in the future. I try not to cover specific banks/groups at specific banks too much because that information changes quickly and it’s not feasible to update it constantly.

  35. Ok so I’m in my final year at a non-target with a non-finance major. Getting into the industry is going to be a crazy uphill battle, so I’m trying every angle I know how.

    There is a local Merrill Lynch branch that specializes in wealth management. I’m looking at it more for the name than what they actually do. Using the advice on here, I successfully cold-called my way into a meeting with the Assistant Vice President, who is alumni of my university. He has an AAMS, and Series 7, 63, 65 accreditation and apparently spent some years in “banking” (not sure which kind) before switching to wealth management.

    What exactly should I talk to him about and what do you think he would be looking for? I’m trying to eventually leverage this into an unpaid internship (again, for the name, but perhaps for a backup plan if necessary) and in the cold call he even mentioned how “Merrill Lynch does recruiting for these kind of things but I’m not sure what the process is.” I know I should keep the conversation focused on him and his “path” and his job and whatnot, but I’m not sure if my goal of investment banking will mesh well with what he does. Franking I know more about investment banking (a lot of which is thanks to this site) than I do private wealth management.

    Any advice?

    1. It’s just the normal informational interview (do a search) – can’t say what to focus on unless you know what he did specifically before (look him up on LinkedIn, alumni networks, etc.). You can still explain your goal at the end and ask if he has any tips regardless.

      1. Thanks!

  36. Hi M&I,

    Is it against the norm to ask a contact at one bank to put you in contact with people in another bank (even if they are not direct competitors)?

    I ask because I met a senior banker at a boutique who likes me a lot, but he’s already told me they are not hiring any SA’s for the summer. I want to keep in good terms with this person, and I’m afraid if I ask him to put me in contact with some of his banking buddies at different banks it would burn bridges.

    Thank you.

    1. No that’s fine

  37. Great interview – I’ve been looking forward to reading up on LevFin!

    Quick question – would a summer internship (London) in Restructuring at RBS provide a good opportunity to move into LevFin?

    Thanks for the help

  38. Brian,

    I saw in one of your other posts that you mentioned one of the recommended books that helps in IB was the “Valuation for mergers, buyouts and restructuring“ by Enrique Ryarzac.

    How does that compare to this book for Pearl and Rosenbaum? Which one would you say is more helpful for recruiting and is the other one also a “must have” or just an aside?


    1. I think that recommendation was from years ago, just ignore it. This one is way better, the other one was some random book I saw elsewhere so not sure how good it is

  39. I borrowed Mr. Pearl’s book from my school’s library the week it came out and never returned it. The fines were worth it.

    Great interview, even with the big void of undiscussed topics.

  40. Have used both this book and BIWS in preparation of interview & internship. Both excellent resources. Was great to have a book as supplement to the video instruction.

  41. Brian,

    Thanks so much for the helpful Q&A as usual.

    As junior people in LevFin and sponsor groups, would their responsibilities be quite similar? If not, what do you see as the main differences? Thanks.

    1. The difference is that you do more technical work in LevFin whereas sponsors is learning more about the market, different PE firms, what they’re looking for and so on.

      1. Got it. Thanks!

    1. I agree, not everyone gets a mention on WSJ, congrats.

  42. bought this book about 30 seconds after reading the interview

    the ultimate sucker? (jk been looking at this book for about 9 months, this interview turned the book from a maybe into a buy thanks M&I)

    1. It’s quality

  43. Stranger danger

    Hey Brian,

    Many banks have financial sponsors group separated from the leveraged fin group e.g.BOAML. In such a case, what’s the difference between the groups?

    1. Sponsors maintains relationships with PE firms and hedge funds and shows them opportunities whereas LevFin executes the deals and structures the debt.

  44. Brian or Josh,

    What do you think about the future of financial services? I know Brian mentioned previously that different industries have their time to shine (advertising and dot-coms being the most commonly cited examples). With all of the bad press and regulation the financial industry has been seeing, when/if do you think the tide will turn?

    Obviously finance isn’t going to disappear as funds management is essential to operating a business, but when will the next big thing emerge? And when that happens, what will happen to financial services as we know it?

    1. There will always be a financial services industry as long as companies need capital, but who knows how long it will stay prestigious. Advertising and startups still exist and people still make money with them, they’re just not as “hot” as they once were. I have no idea what the next big thing will be and can’t even venture a guess as to when/if things will change and what the new cool thing will be.

  45. Thanks a lot Brian, very good interview. I just bought the book and hopefully it will shed more light on modeling and help me to be better prepared to break into investment banking.

  46. Great Brian, keep them coming, cool to hear an interview with somebody more senior and some more insight into LevFin.

    Agree to the posters above get that book and subscribe to BIWS and you are going to be very well prepared.

  47. so, overall, would you say lev fin is better than m&a to break into pe?

    1. Not necessarily “better” but just another option… I don’t think anyone has stats as they are very hard to come by.

  48. Great interview! I’ve been a dedicated reader of your blog and have also read Josh’s book. During my SA stint I used it as a reference, and it helped me out a ton during the FT interview process. In all honesty, I think it is fair to say that M&I and Pearl’s book are an absolute requirement for anyone trying to break into banking.

  49. Awesome. Both this book and the BIWS modelling course are helping me loads and loads at work. I’m slowly getting more confident with it all. Hopefully I’ll be an excel ninja in the next 12-18 months.

    1. Cool glad to hear it!

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