Sample Day Series: Debt Private Placements Analyst

August 27, 2016

6 am: Wake up, check mail to see if there are any updates to a few pitches my managing director was presenting on his Europe trip.

 

7 – 8 am: Leave the apartment with earphones on, tuned in to the 7 am global DCM team update call. The flavor of the day is the Greek bailout and impending referendum. The teams from the UK and US mention how a few public bond deals were pulled due to the European turmoil and volatility. The conversation then turns to a few organizational changes within the bank and updates from other teams on investor appetites, spreads, and oversubscriptions on closed deals.

 

8 – 9 am: Enter the office, receive comments from the managing director on a live deal just about to launch. We are looking to position the client closer to a comparable with similar business lines but has their 10 year public bond trading on lower spreads. The problem will probably be on the ratings side since the client only has an NAIC designation that puts them a bit lower than the comparable. We have our work cut out for us here convincing investors that the client is worth the -20 bps discount (.20 percentage points lower in their final coupon). Sales calls to investors will be made throughout the day.

 

 

9 – 10 am: Get pulled into an investor meeting with my managing director. One of the big insurance companies is in town and the bank takes the opportunity to show them a few upcoming deals and update them on their DP investment history with the bank’s clients.

 

10 – 11:30 am: Check emails—receive a few updates from the managing director in Europe. Work on and send some updated comparables for a client company very interested in issuing a private placement in the coming year.

 

11:30 – 12:30 pm: Grab lunch with the team at one of our usual spots while talking to a director about the upcoming NBA season. Eat lunch at the desk while checking out the latest Greek news and 10 Year rate on the Wall Street Journal/Bloomberg.

 

12:30 – 1:30pm: One of the other directors is leaving on a trip to Australia and would like to spread comparables and do some historical debt analysis for a few clients he will be visiting (some of which have issued DPs before). Fire up Bloomberg and check the client companies and their credit ratings to determine comparables based on their current rating and business model. We would like to keep the client within the spreads of their best, reasonable peer group. We also prepare a few slides to analyze how the spreads have changed versus the last pitch and what spreads could look for different tenors (usually 7 year, 10 year, 12 year).

 

1:30 – 2:30pm: Hop on a call with the deal team for a live deal. We are finalizing the offering memorandum (OM) for a UK-based client. The managing directors for both banks (joint bookrunners) brief the client on the potential impact of a positive Greek referendum and how private placement investors have been taking the news. The client is basically talked out of pulling the deal due to “unfavorable economic conditions”. Talks then proceed onto certain aspects of the client’s story that would need to be highlighted to further bolster their appeal to investors. Focus is on the strong cash flow and business expansion of one of the top product lines.

The team works on the offering memorandum for the rest of the afternoon.

 

5:30pm: Finish up the offering memorandum draft and send to the deal team. Receive a call from another managing director that a pending deal just went live—the company has assigned two joint bookrunners for the deal. The work plan is set to be divvied up between the banks in a few hours since the client wants to move fast. Quickly get dinner at Potbelly’s while chatting with an analyst friend from another group within the bank.

 

6:30 – 8pm: Get on the phone with the analysts and directors from the banks involved. Our bank is assigned to do the OM (a.k.a the heavy lifting). Investors are split evenly between the two banks. The draft OM is not due until later in the week so there is a reprieve.

8pm: Leave the office, check text messages—decide to join a bunch of guys from the same University at a bar close to the apartment.

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