I have an interview scheduled for a syndication officer position. I’ve been a financial analyst for the past 2 years and have been seeking to move onto something new, specially given that my company does not have a proper career path after being an analyst. Due to the current market, I have been applying to all sort of jobs, and have landed this interview. Has anyone worked on loan syndications before? Any tips or useful info I could use to impress the interviewers? Thanks!
Understanding how it works is the first step. One or two financial institutions (depending on loan size) usually act as Agent and deal directly with the customer (the Company) to structure the transaction i.e. the size of the facility, the covenants, any extensions/accordions, all the nuances of loan structuring (depending on Asset Based or Cash Flow) come into play here. Usually the Agent holds the largest chunk of the loan (in order to have the ability to drive any changes to the loan agreement in the future which is usually based on majority vote). The rest is syndicated to other banks. This is a very broad view of how it works. I would know the various terms used in the industry such as covenants (Fixed Charge Coverage, Total Leverage Ratio, Cah Interest Coverage Ratio etc), the difference between a senior secured, senior and subordinate facilities (the capital structure), Pricing (LIBOR based Vs. Prime), current adders that exist in the market etc. If you are going to be the one syndicating (i.s. on the trade desk), you will need to know the key systems they use to track loan trading, have strong interpersonal skills as a successful syndication is usually driven by relationship banks (in tough times at least)… Shoot back with any questions…good luck. P.S. Im in Credit Risk Underwriting and Portfolio Management but I deal with syndication desks all the time. If you are on the trade desk, its usually a sales/relationship role.
Thanks Salz. Very useful post!