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    Hi everyone. My first post -

    What exactly is the difference between a syndication team in DCM and syndication in a loan team please? Apparently they're different but I thought a loans are also part of the overall DCM universe.

    I was wondering whether people from DCM can move easily into loan syndication or vice versa? I have a job offer from a loan syndication team but ideally want to be in capital markets (DCM/ECM) where you help companies raise debt. Would this role be any good and relevant to my interests? I'm looking to build financial modelling skills but not necessarily in M&A - would there be any of that in a loan syndication team?
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    Hey Pnik,

    Well it's an interesting one, in terms of positioning within the structure of the bank it is somewhat unique, DCM is clearly on the banking side, whereas Sales is clearly on the markets side. Syndicate seems to fall inbetween the two both where it sits in the bank and also in terms of skills required & the work you are doing.

    Your role in Syndicate is to price debt at a price which the issuer is happy to pay and that the market sees as being a fair risk premium for holding. As such you are working with both the issuer - trying to understand their business and determine the risk they present - and also working with the market to decide what premium this level of risk should be priced at. Unlike DCM there is more of a markets focus, in the sense that you are working with the buyside to price this debt - you have both the interests of the issuer and the buyer in mind, rather than wanting the lowest interest as you would in origination or the highest as you would as a sales person trying to shift this stuff!

    The role keeps your future options really open, you can move into banking or you can go across to markets. I'd say the most likely areas to go would be either Origination or Sales. You won't really be doing much building of financial models, not like you would in M&A for example, but you will certainly see this sort of work being essential as you are ultimately pricing debt. However, it also focuses on the real markets - not just projections, models, etc - as the debt you are pricing has to be sold and so if the market doesn't like the price, it doesn't matter how good your models are, it won't sell.

    In a sense you are the bridge taking debt issuance from the initial origination team through to the markets, and ensuring that the company actually raises the capital - not just has an analysis of how they could do so.
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    (Original post by pnik)
    Hi everyone. My first post -

    What exactly is the difference between a syndication team in DCM and syndication in a loan team please? Apparently they're different but I thought a loans are also part of the overall DCM universe.

    I was wondering whether people from DCM can move easily into loan syndication or vice versa? I have a job offer from a loan syndication team but ideally want to be in capital markets (DCM/ECM) where you help companies raise debt. Would this role be any good and relevant to my interests? I'm looking to build financial modelling skills but not necessarily in M&A - would there be any of that in a loan syndication team?
    To answer this question specifically, this will vary from bank to bank (whether loans are dealt with separately to other debt financing tools). Within loans syndicate the job will differ greatly depending on whether you're working on high-yield or investment grade (again, some banks have separate teams, others not).

    With regards to your question about financial modelling skills, again there are big variations - at some banks the syndicate guys check out at 6pm and do alot of sales work, whereas in other banks the syndicate guys work long hours and do alot of banking work (which is where your structuring, modelling etc would come in).

    So yeah, if you're holding an offer for something here, ask the guys what their style of work is because syndicate could involve very different remits in different banks. (CS and GS come to mind as more banking-focussed if I recall correctly).
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    I'm told that in HY Syndication and Loan Syndication there can be a fair bit of modelling, altho probably not to a level close to M&A or anything...
    oher areas of DCM Syndicate will have little to no modelling.
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    (Original post by RJA)
    To answer this question specifically, this will vary from bank to bank (whether loans are dealt with separately to other debt financing tools). Within loans syndicate the job will differ greatly depending on whether you're working on high-yield or investment grade (again, some banks have separate teams, others not).

    With regards to your question about financial modelling skills, again there are big variations - at some banks the syndicate guys check out at 6pm and do alot of sales work, whereas in other banks the syndicate guys work long hours and do alot of banking work (which is where your structuring, modelling etc would come in).

    So yeah, if you're holding an offer for something here, ask the guys what their style of work is because syndicate could involve very different remits in different banks. (CS and GS come to mind as more banking-focussed if I recall correctly).

    (Original post by rozzr)
    Hey Pnik,

    Well it's an interesting one, in terms of positioning within the structure of the bank it is somewhat unique, DCM is clearly on the banking side, whereas Sales is clearly on the markets side. Syndicate seems to fall inbetween the two both where it sits in the bank and also in terms of skills required & the work you are doing.

    Your role in Syndicate is to price debt at a price which the issuer is happy to pay and that the market sees as being a fair risk premium for holding. As such you are working with both the issuer - trying to understand their business and determine the risk they present - and also working with the market to decide what premium this level of risk should be priced at. Unlike DCM there is more of a markets focus, in the sense that you are working with the buyside to price this debt - you have both the interests of the issuer and the buyer in mind, rather than wanting the lowest interest as you would in origination or the highest as you would as a sales person trying to shift this stuff!

    The role keeps your future options really open, you can move into banking or you can go across to markets. I'd say the most likely areas to go would be either Origination or Sales. You won't really be doing much building of financial models, not like you would in M&A for example, but you will certainly see this sort of work being essential as you are ultimately pricing debt. However, it also focuses on the real markets - not just projections, models, etc - as the debt you are pricing has to be sold and so if the market doesn't like the price, it doesn't matter how good your models are, it won't sell.

    In a sense you are the bridge taking debt issuance from the initial origination team through to the markets, and ensuring that the company actually raises the capital - not just has an analysis of how they could do so.
    Thanks guys. That helps me very much to understand the role. To further understand these kind of roles, is there a source/book which explains the roles within DCM/ECM more clearly? Such as what syndication do, what origination do etc etc?

    Thanks
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    (Original post by pnik)
    Thanks guys. That helps me very much to understand the role. To further understand these kind of roles, is there a source/book which explains the roles within DCM/ECM more clearly? Such as what syndication do, what origination do etc etc?

    Thanks
    Have a flick around Wall Street Oasis, there's normally some guy talking about what he does in quite some detail...for quite specific teams too.
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    (Original post by RJA)
    Have a flick around Wall Street Oasis, there's normally some guy talking about what he does in quite some detail...for quite specific teams too.
    Thanks. I'm aware of that site. Great idea! Is there a way to give you positive rep? I'd like to show my appreciation.
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    If you want to know specifically about Syndicate I know a bit about it, as that's where my full time offer is and spent a few hours with the desk learning what goes on there, so you can just message me any specific questions. I can't give you any indepth info on the other areas though to compare to, well maybe Sales on the Markets side, but not for other banking areas.
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    (Original post by rozzr)
    If you want to know specifically about Syndicate I know a bit about it, as that's where my full time offer is and spent a few hours with the desk learning what goes on there, so you can just message me any specific questions. I can't give you any indepth info on the other areas though to compare to, well maybe Sales on the Markets side, but not for other banking areas.
    Oh where will you be joining? I did final round for Debt Syndicate at GS this week, eagerly awaiting a reply!! :P
 
 
 
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