Leveraged finance
Arranging loans and bonds for companies with a lot of debt, often ones being bought by private equity firms.
Leveraged finance is the debt that funds private equity acquisitions, dividends, and corporate capital structures, sitting where M&A meets capital markets. The typical deal is an LBO, a sponsor contributes 20-40% equity and borrows the rest, running 4-6x net leverage at entry and deleveraging to 2-3x at exit, on entry multiples of 8-12x EBITDA.
The debt stack is layered by seniority. A revolving credit facility sits at the top for liquidity. Term Loan A is 5-7 years, amortising, priced at SOFR plus 300-400 bps, held by banks. Term Loan B runs 7-8 years with minimal amortisation at SOFR plus 400-550 bps, syndicated mainly to CLOs and hedge funds. Second lien sits junior at SOFR plus 700-1000 bps, with mezzanine and PIK holdco notes at the bottom.
LevFin teams arrange this stack, negotiate covenants, tight maintenance ratios on TLAs, looser incurrence tests on TLBs, and run syndication. Equity returns, targeted at 20-25% IRR, flow from a waterfall of EBITDA growth, debt paydown, and exit multiple expansion.
Credit discipline runs throughout. Leverage and coverage covenants protect lenders; CLOs absorb roughly half the TLB market; direct lenders like Ares, HPS, and Owl Rock now originate 30-40% of financings. Arrangers such as JPM, Goldman, and Barclays earn arrangement fees around 1-1.5% and underwriting fees of 0.5-1%, with OID on syndicated loans as de facto upfront payment. A posting mentioning these names, instruments, or markets is hiring into this world.
Open jobs
| Job | Firm | Level | Stage | Posted |
|---|---|---|---|---|
| Leveraged finance · Corporate |  Crédit Agricole CIB | Summer | Second-to-last year at university | 7 days |
| Leveraged finance | Crédit Agricole CIB | Placement | Second or second-to-last year at university | 3 weeks |
| Debt capital markets |  Bank of America | Summer | Second-to-last or final year at university | 4 weeks |
| Leveraged finance · Mid-cap |  JPMorgan | Analyst | 1+ years | 4 weeks |
| Leveraged finance | JPMorgan | Analyst | 1 to 2 years | 5 weeks |