杠杆融资(Levfin):这是什么?

Patrick Curtis

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Patrick Curtis WSO Editorial Board

Expertise:Investment Banking | Private Equity

杠杆融资(also known asLevFin or LF)是Investment Banking Division (IBD)of a bank that is responsible for providing advice and loans to private equity firms as well as corporations for primarily:

  • 杠杆收购,
  • Recapitalizations,
  • 再融资旧债务,
  • Mergers & acquisitions.

Raising debt (or leverage) is typically done as a means to boost returns on a potential investment if a company doesn't have enough capital to purchase the acquisition outright with cash.

LF的主要区别之一是,它们主要关注的是发行投资级低于债务。Firms in this below-investment-grade category often have a higher default rate, higher risk, higher leverage use, and less consistent operating results. To offset this, debt issuances to these firms often have a higher return. Each deal the client presents may be different and as a result will require different solutions.

杠杆融资Group Definition

LF departments work on acquisitions (LBOs), recapitalizations, and asset purchases. Companies looking to do any of those things can do so using debt, and it is cheaper to use debt than to use equity or cash.

Although this group andDebt Capital Markets (DCM)teams both work with debt, theDCM团队与投资者和市场合作,而LF团队与实际公司on the structuring of the deal. They typically make money by earning fees on the debt they help raise and advise on. One of the most prestigious LF groups is within J.P. Morgan in Europe. Leverage is sometimes referred to as 'gearing' in European countries.杠杆融资摘要

杠杆在金融中意味着什么?

Simply put the word "leverage" is synonymous with the word "debt". In finance, "levering up" means to use outside funding, typically borrowed capital as a means to generate or maximize returns on a potential investment (this debt becomes part of the capital structure like any other). Companies may often choose to use leverage in their projects as it is cheaper and easier to get compared to issuing stock through an IPO or secondary offering. In the capital structure, secured bank debt (backed by collateral) is typically senior to unsecured debt which is more common for LF teams to be involved with. Both of these types of debt are senior on the capital structure compared to mezzanine, preferred or common equity.

公司使用杠杆是好还是坏?

对于缺乏大型公司购买力或资本的公司而言,正确管理的杠杆可能是一个很好的战略工具。从参与LBO的私募股权基金中,杠杆是他们为LP产生超大收益的主要方式之一,因此对他们的业务模式至关重要。

Of course, with this use of leverage, it will also increase the potential downside risk of an investment. Mismanaged leverage can easily burden a company and too much debt may increase risk for those holding equity in the company. An example of this would be a corporation undertaking a risky project or investment using leverage. If this risky investment didn't go the way the company planned, it could leave the company in a vulnerable position where the equity position in the company compromised (or in a bankruptcy, sometimes completely wiped out!). As a result, too much debt on a company can lower the valuation of a company since it increases the risk of it as a going concern.

杠杆融资投资银行业务吗?bob竞技体育游戏

是的。LF组只是一个部门Investment Banking Division银行和他们通常与银行中的合并和收购团队紧密合作。

What Do LevFin Teams Do?

银行中的LF团队可以在投资者与寻求筹集资金的公司之间充当中间人。该团队通常会致​​力于结构交易,通常会担任咨询角色,并最终致力于该交易的执行。

虽然他们的工作类似于DCM角色,关键区别在于其客户,通常是私募股权公司(PE)公司。该团队的成员通常将是:与客户沟通,分析和检查客户的信用/风险状况,为交易构建债务以及分析债务的潜在回报。

What is a Typical LF Deal?

These deals typically include a large sum of debt, typically up to a point where 50-60% of the capital structure is debt (compared to 50-40% equity). These deals have the added benefit of increasing a project'sInternal Rate of Return (IRR)

Due to the riskier nature of the transaction, the return on the investments is much higher than secured bank debt, and is often referred to as高产。这些交易通常是特定的,需要LF团队中的交易解决方案。

杠杆作用d Lending vs LevFin Groups

At the base level, this is the key difference between the two: one is a firm, usually in theMiddle Market (MM)while the other is a division within a firm usually in a凸起支架(BB)。LF groups at aBB摩根大通银行(美国银行)操作更类似于一个通用电气Capital, just on a larger scale, both in terms of clients and the average size of each transaction. They will also provide clients with access to the bond market, which can include high yield bonds. Public bonds are not a common method of debt financing in the middle market given that most of these companies are private. However, leveraged loans and unitranche debt have taken on a lot of the structural characteristics of a High Yield debt in Credit Agreement terms (e.g., cov-lite, basket definitions, Available Amount).

杠杆作用Finance Investment Banks

Due to the nature of the business - lending extremely large amounts of capital - boutique IBs typically can't have a slice of the LF pie. Besides the bulge brackets in the space, middle market firms like Jefferies,RBC和GE Capital也是大型参与者。对于退出机会和声望,与您合作的公司是未来成功的最大因素之一。要考虑的另一个因素是该银行部门的交易流量:确保您的银行拥有适当的交易流量将极大地帮助退出机会。这是LF中一些最佳名称的详尽列表。有关更多信息,请参考我们WSO公司数据库。

J.P. Morgan
-American Multinational Investment Bank and Financial Services Holding Company
-Statistics and Breakdown of J.P. Morgan
-J.P.摩根的杠杆融资排名
Bank of America Securities
-American Multinational Investment Banking Division
-Statistics and Breakdown of Bank of America
-美国银行的Levfin排名
Credit Suisse
-Global Investment Bank and Financial Services Firm
-瑞士信贷的统计和细分
-瑞士信贷LF工作场所文化
花旗
-Global Investment Bank and Financial Services Firm
-花旗的统计和细分
-花旗集团——杠杆融资Thoughts
Goldman Sachs
-美国跨国投资银行和金融服务公司bobapp下载链接化管理
-Statistics and Breakdown of Goldman Sachs
-LevFin's Role at Goldman Sachs
摩根士丹利
-美国跨国投资银行和金融服务公司bobapp下载链接化管理
-摩根士丹利的统计和细分
-摩根士丹利's LF Division Compared to its Competitors
Wells Fargo
-American Multinational Financial Services Company
-富国银行的统计和细分
-Wells Fargo LF Exit Opportunities
巴克莱
-英国跨国世界银行
-Statistics and Breakdown of Barclays
-巴克莱Work Culture

These are only some of the top players in this space. Visit ourWSO公司数据库to find more information about each company.

Sample Leveraged Finance Interview Questions

通过Levfin访谈过程可能是一个挑战,因为通常会有涉及复杂债务结构的问题。面试官可能会问您问题,您没有期望或复杂的大脑挑逗。为了帮助您获得您可以期望的问题的味道,我们已经收集了公司数据库中的杠杆融资访谈示例示例以及这些申请人给出的答案。

For a more comprehensive list of LF interview questions reference ourWSO公司数据库(filtered for this specific group) or this discussion for some morebrain teasers

Frequently Asked Interview Questions

Hours, Salary, and Daily Work of Leveraged Finance Bankers

As part of the Investment Banking Division (IBD), the hours, salary, and daily work for those in LF are comparable to those in other areas. Key distinctions here are, long and difficult hours, salary + bonus of around $130,000-$180,000 a year, and daily tasks such as structuring leveraged loans and assisting with"Leveraged Buyouts (LBO)"。鉴于客户的动态需求,该组的银行家可以执行从

  • Credit analysis,
  • 写作批准备忘录,
  • Talking to investors, and
  • Financial modeling.

The needs of the clients are always shifting and as such, bankers are often forced to come up with novel and unique solutions that fit their specific situation. Compiled below are some personal accounts from other WSO members regarding their experience working in these groups.

LevFin Work Hours

LF组的时间是多少?这些时间与并购相比如何?这些时间因公司而异?从 @exadbnkr13中回答所有这些问题”。Levfin Work Hours

exADbnkr13:
I worked as an analyst, up to Sr. VP in Lev Fin - first at a mid-size bank, then at 2BBfirms. I had first started my career inM&ABB, so I have a good sense of comparing the 'brutality', if you will. I would say that Lev Fin is on par withM&Aas having the most grueling hours. The reason is really the client base. If you're working in Lev Fin, your clients are predominantlyPEfirms, and they are (obviously) the most demanding, time-sensitive clients to deal with.

Hours are just as gruesome asM&A, 70-80 hour weeks are the norm, and 100+ when it comes to crunch time. As for what you spend your time on in LF, it's mostly credit analysis and modeling - although some firms don't do any modeling whatsoever.

Levfin薪水

薪水与大多数投资银行演出相媲美,全力以赴bob竞技体育游戏$130k

“在大多数投资银行的初级水平上,这是可比的。如果LF不是银行的核心(即,咨询比债务融资更咨询),那么由于该集团没有盈利(或根本),因此可能更低。在一个良好的市场中,LF是较受欢迎的团体之一,因为它具有提供主食融资的能力,这有助于赢得卖方的授权。这可以有利可图,因为根据带来的费用,任何其他银行垂直行业的垂直行业都可以盈利其中取决于信贷市场的类型。”

Daily Work

LevFin-Day-in-the-life分析师主要结合了信用分析,建模和其他杂项。这是他们从@ginntonic所做的事情的一个很好的摘要”。

ginNtonic:
Analysts structure leveraged loans / high yield bond deals for corporate and private equity firm transactions, such asM&A,LBOs, div recaps, etc. Analysts will write approval memos, offering materials, talk to institutional/bank investors, and model transactions.
Thing is, there's a lot of variation in the above functions depending on the firm. Some groups do plenty of modeling; some do a little; some do none. Some groups don't let their analysts talk to investors; most do.

退出机会

LF为您带来的三个出口机会是:

对于对冲基金和私募股权,作为LF的退出OPP,您的机会在很大程度上取决于您所工作的公司。请参阅上面的“杠杆融资投资银行”下的列表,以了解哪些公司在退出机会和声望方面最适合工作。

对于夹层基金,他们的工作主要包括与杠杆收购合作,满足投资者的特定需求,无抵押债务,少数covenants,并处理私人交易。所有这些都与银行杠杆融资部门所做的工作类型相似,这使这些计划使夹层资金出色。

Besides the above three exit opportunities, there are always the typical investment banking exit opps: entrepreneurship, grad school, and all sorts of roles within a corporation.

Should I Work in LevFin?

利用金融集团与其他投资银行集团相比如何?bob竞技体育游戏对于职业机会,这是与 @1StyearBanker的其他团体相抵触的方式”。杠杆作用Finance Groups

1styearBanker:
From a general approach, LF with good experience will be just as good, if not better thanM&A, but analysts from both groups depend heavily on deal flow and their experiences.
尽管M&A在许多情况下,在许多情况下,LF小组为许多最佳投bob竞技体育游戏资银行集团提供蛋糕,在其他情况下也更好。如果您与我们之前提到的任何顶级公司获得报价,那么您将为自己准备一些不错的退出机会。

在Levfin小组工作之前的实习准备

Secured a summer internship in LF and looking to get prepared? Fret not! Here's three tips for you.

  • Brush up on your modeling skills. It always helps to be familiar withIBOmodels although the extent to which you will model will largely depend on your team culture / bank. (As mentioned countless times, some teams do more modeling than others.)
  • I would also not forget to work on your PowerPoint skills. Although you do significantly less PowerPoint than in industry coverage teams, it still helps to be efficient at this level.
  • Understand the differences between leveraged loans and high yield bonds, the processes, the technicalities, etc. This is probably the most important, as being able to understand the technical aspects can really make you stand out.

要注意的一件事是,您可能会做很少的建模,因此如果这不是您的强项,请不要担心太多。但是,二和三的技巧是金色的。您应该绝对掌握PowerPoint,并了解三个中提到的术语。

**要了解有关此概念的更多信息,并成为LBO建模的主人,您应该检查我们的LBO建模课程。Learn more here。**

leveraged-finance_wso-course_lbo-modelling

模块1:介绍

Module 2: LBO The Big Picture

Module 3: Valuation and Transaction Assumptions

Module 4: Sources and Uses: The Theory

模块5:来源和用途:应用于Nike Case

模块6:P&L预测和LBO调整

模块7:债务时间表

Module 8: Balance Sheet and Adjustments

Module 9: Taxes

模块10:退出,返回和灵敏度分析

Bonus Module A) Purchase Price Accounting

奖金模块b)股息回顾

Bonus Module C) Add-on Acquisition Build

Learn More Here

Related Terms

Return to the Finance Dictionary

Read Forum Topics About LevFin

Interested in Investment Banking - Breaking Into LF

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IBInterview Course Here

Patrick Curtisis a member ofWSO Editorial Boardwhich helps ensure the accuracy of content across top articles on Wall Street Oasis. He has experience in investment banking at Rothschild and private equity at Tailwind Capital along with an MBA from the Wharton School of Business. He is also the founder and current CEO of Wall Street Oasis This content was originally created by memberwallstreetoasis.comand has evolved with the help of our mentors.