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Acquisition Finance: Bullet Debt

Acquisition Financing – Investment Grade Bonds, Private Placements, Term Loan B, High Yield Debt Bonds, notes and term loans for institutional investors are otherwise seen as much more permanent capital than bank debt and is not meant to be paid down opportunistically. Fixed income investors – which are a distinct group

Working in Treasury

Related: Interview with a Treasury Analyst What is Corporate Treasury? Treasury is the cash management function of the bank – it is responsible for cash inflows and cash outflows. Ideally, the treasury maximizes the cash inflows while minimizing the cash outflows via a variety of risk management solutions and opportune financing. Treasury

Debt Capital Markets Analyst and Associate Work

For the most part, DCM analysts and associates do the same thing, except the associate knows the process a lot better and is able to guide the analysts. Identifying Clients for DCM to Talk To DCM will usually have a rolling list of upcoming maturities to look at which companies to approach.

Debt Capital Markets

What is Debt Capital Markets (DCM)? Back to Investment Banking Debt Capital Markets (DCM) is a financing group in Investment Banking which helps to connect debt issuers and debt investors depending on their respective needs pertaining to tenor/maturity, currency (issue in USD, CAD, GDP, CNY, JPY, EUR), coupon (fixed/floating), security/collateral, and other

Investment Banking Credit Ratings Advisory

Brain Teasers

Credit Ratings for Blue-Chip Corporates Companies care about their credit ratings and may have certain targets. For instance, many companies have historically aimed to maintain an investment grade rating from at least one credit agency (BBB- for Standard and Poors or Baa3 for Moody’s). Blue-chip stocks that see widespread investor interest are

Differences Between Leveraged Finance and DCM

What is Leveraged Finance? Leveraged finance ("LevFin") is in its official capacity a debt capital markets (DCM) group. However, when investment bankers refer to DCM they are almost always referring to investment grade debt capital markets. Levfin is in practice treated as a separate product group. Functionally, the two roles end up

Early Bond Redemption Analysis

Early Retirement of Debt for Capital Structure Debt Capital Markets may approach companies to discuss opportunistically retiring outstanding debt before the natural maturity date. As bonds are contractual obligations for a set period of time, the early paydown of debt must be negotiated unless there is a provision that allows for

Hedging Interest Rate Risk

Risk From Rising Interest Rates When organizations issue debt, they face interest rate risk – that is risk from fluctuations in benchmark interest rates (the government or bank interest rate that their loan interest is based on) may cause cash flow obligations to increase. Simply, if interest rates rise, future interest