I've done internships in Commercial Banking on the large corporates team (clients were Robinhood, Square, Stripe, etcetera), I have done an IB internship at a boutique, a buy-side Investment Research internship, and a Sales & Trading internship at a global investment bank. IMO, CB is the least stimulating work. You don't find where loans should be trading/priced at as Bryna indicates, that is more done at the senior level on specific teams. You mostly just do credit analysis, similar to what you would be doing at a rating agency. Can this company's cash flows pay back their debt? Yes or no. Input some factors in the company system and it spits out a risk rating which determines their interest rates. With IB, you do a lot of crap work with aligning logos, but you also get to analyze every facet of the business. Valuation is much more mind stimulating than assessing credit risk imo. S&t keeps you involved in the markets everyday which is exciting too.
The other important difference is life/balance. CB is more IB light. They don’t work you to death and salaries are decent. Something to consider if you’re a bit older or starting/having a family (late 20s-30s)
@@kylehanson5175 studying economics got the internship for the summer entering my 4th year. Not doing it though, I got JPM for asset and wealth management at the private bank instead
CBankers typically own the relationship with clients at banks that have large balance sheets (deposits). They don’t do many term loans unless they are involved in project finance, more focused on getting into a clients revolver or providing bridge loans for M&A. It Is usually cheaper for corporates to raise money on public markets than raising money through bank debt. But project finance loans are more complex and less vanilla so it’s better to use bank debt or private credit. There is a political process behind being in a top position of a revolver as the client will owe more business to the bank to manage their credit relationships. So all this said, I’d disagree that corporate bankers are like a wingman - they are more of a gatekeeper. If you are the most profitable service the bank provides to corporates than maybe it’d be more of a wingman thing because the corporate banker will always let you work with the client (I’m not a corporate banker)
Some people in my group have gone onto private credit firms that do similar work in the debt capital markets but that are willing to take more risk in terms of where they fall in the capital structure and priority of claims. Great video as always!
Such a great video! Just what I have been waiting for. Could you please do your next video about the timelines for recruiting and what a technical interview looks like?
I just got a Postion offer for Sales Supplier Spec for JPM. Any tips and advice, coming from a different industry background, but thankful & blessed for the opportunity.
Hi Man, I am an Italian currently studying in France at a top-tier bs (at least for France/Europe). I have a pretty decent academic/e.c. cv (bachelor with honours, elite sport bla bla) but no concrete experience in finance. Would you suggest me to go into corporate banking before IB? Currently my strategy is to apply for both and see what happens, but given the resumes of those at my same school it will be slightly harder for me to get immediately into IB (I think) By the way, great video and thanks!
Hi, i have done all my Business School studies in France (i am french). Would recommend you to aim high and start with IB. if you can land several internships (if you are in M1 or M2 with a gap year between two). Start with : 1. IB boutique 2. French top bank (SG, CACIB, BNPP) 3. Convert your internship into these banks or; 3. Bis. Apply for a Bulge Bracket bank (JPM, Citi, GS, BAML) 4. Try to get a full time job ( Paris or London) Also, summer internships are good in London, so better to try your luck
Best part of commercial banks is when you issue a housing loan to an applicant and he/she visits with his/her family to take disbursement well that's wholesome.
Need for debt and structure of debt are some reasons off the top of my head. E.g. corporations need a revolving line of credit for working capital needs - not sure this can even be accomplished via bond issuance
higher costs and longer process to issue bonds, loans have a syndicate of a few banks/funds and therefore makes it easier to agree on terms, term loans usually have maturities of 7 yrs whereas bonds have longer tenor, also if you have plans to deleverage (like in an LBO) loans are better bc bonds have hard and soft call protection whereas loans usually have just soft call provisions
Just to add, another big factor is pricing (maybe less so where there is persistent low rates and QE) - as a general rule of thumb longer tenor equates higher premium; and bonds may not be the cheapest compared to senior bank debt. Furthermore to issue bonds you need a credit rating - not every Corporate has one, large enough to warrant getting one, or have a sufficiently good rating to issue bonds with the best (lowest) coupons.
I want to get into IB, I currently work in an back office role, senior. My position is within operations. I'm 28 and going into a MSc program. Can you give advice on how people already in Finance, can pivot into IB? ( back office to front office).
@@HRH-pn2qe Honestly not fully sure, I would just go on LinkedIn and find people that graduated from your MSc program see what they are doing and message them.
