Foundations
Banking 101: Groups Explained
M&A, coverage, LevFin, ECM, DCM, and Restructuring — what each group actually does.
8 min read
Investment banking can be confusing because banks are divided into teams, industries, products, and regions. Most teams can be understood through two broad categories: coverage groups and product groups.
What Is Investment Banking?
Investment banking helps companies, governments, and financial sponsors raise capital, evaluate strategic decisions, and complete major transactions.
- Mergers and acquisitions
- Buying or selling a company
- Raising debt or equity
- Refinancing debt
- Going public through an IPO
- Restructuring a balance sheet
- Evaluating strategic alternatives
Junior bankers often work on financial models, valuation, company research, market updates, presentations, and preparation for client conversations.
Coverage Groups vs. Product Groups
Coverage Groups
Focus on a particular industry or client type. Bankers develop sector knowledge, understand clients and competitors, and maintain relationships across different transaction types.
Product Groups
Focus on a particular transaction or financing. Specialists can work across industries or be organized by industry and are brought in when a client needs expertise in M&A, debt, equity, restructuring, or another product.
Coverage Groups Explained
Healthcare
Pharmaceuticals, biotechnology, medical devices, healthcare services, hospitals, insurance, and healthcare technology. Key themes include regulation, reimbursement, patents, innovation, and consolidation.
Technology
Software, hardware, internet, semiconductors, fintech, cybersecurity, and related companies. The group often focuses on growth, recurring revenue, margins, innovation, valuation multiples, and M&A.
Media and Telecommunications
Streaming, advertising, content, entertainment, wireless, broadband, and communications infrastructure. Themes include subscriptions, digital transformation, infrastructure investment, and consolidation.
Consumer and Retail
Food and beverage, apparel, restaurants, household products, e-commerce, and traditional retail. Themes include brands, consumer trends, margins, supply chains, pricing power, and growth.
Industrials
Manufacturing, transportation, aerospace and defense, packaging, chemicals, building products, and business services. Themes include supply chains, production, margins, capital spending, and economic cycles.
Financial Institutions Group (FIG)
Banks, insurers, asset managers, fintech companies, specialty lenders, and other financial institutions. FIG uses specialized balance-sheet, regulatory, and valuation concepts.
Real Estate
REITs, developers, property owners, services companies, and related businesses. Themes include asset values, rates, financing, occupancy, rent growth, and capital markets.
Energy
Oil, gas, renewables, infrastructure, and services. Themes include commodity prices, reserves, production, regulation, capital intensity, and the energy transition.
Power and Utilities
Regulated utilities, power generation, renewable developers, and infrastructure. Themes include regulation, grid investment, project financing, and contracted cash flows.
Financial Sponsors
Private equity and other sponsor clients. Bankers help sponsors evaluate acquisitions, sell portfolio companies, raise financing, and pursue exits. Banks classify this group differently.
Product Groups Explained
Mergers and Acquisitions
Advises companies buying, selling, or merging businesses. M&A bankers support valuation, strategy, deal structure, negotiation, process management, and execution.
- Valuation analysis
- Buyer and seller materials
- Accretion/dilution
- Merger models
- Strategic rationale
Leveraged Finance
Helps non-investment-grade companies and sponsors raise debt for acquisitions, LBOs, refinancings, and recapitalizations. The group focuses on debt capacity, credit risk, leverage, rates, and investor demand.
- Leveraged loans
- High-yield bonds
- Acquisition financing
- Refinancings
- Recapitalizations
Debt Capital Markets
Helps primarily investment-grade companies raise debt and advises on timing, size, structure, and pricing in light of market conditions.
- Investment-grade bonds
- Interest rates and Treasury yields
- Credit spreads and ratings
- Refinancing
- Investor demand
Equity Capital Markets
Helps companies raise equity and advises on market timing, investor appetite, valuation, offering size, pricing, and dilution.
- IPOs
- Follow-on offerings
- Convertible securities
- Block trades
- Private placements
Restructuring
Advises companies, creditors, and stakeholders dealing with distress, liquidity problems, or unsustainable debt.
- Distressed debt
- Liquidity and bankruptcy
- Debt negotiations
- Asset sales
- Liability management and recoveries
Private Capital Advisory
Helps companies and investment firms raise private capital or complete secondary transactions.
- Private capital raises
- Fundraising
- GP- and LP-led secondaries
- Continuation vehicles
Capital Solutions
Develops customized financing strategies across debt, equity, private credit, preferred equity, convertibles, and hybrid capital. Responsibilities vary considerably by bank.
- Capital structure
- Financing alternatives
- Structured equity
- Private credit
- Refinancing and liquidity solutions
How Coverage and Product Groups Work Together
If a technology company acquires a competitor using cash and debt, Technology coverage bankers may manage the client relationship and industry context, M&A bankers may advise on transaction structure and execution, and LevFin or DCM bankers may arrange debt financing. ECM may join if equity financing is required.
Which Group Is Best?
There is no single best group. Coverage may suit students who want deep industry knowledge, long-term client relationships, company strategy, and varied transaction exposure. Product groups may suit students who want transaction specialization, cross-industry experience, technical execution, financing, or capital-markets exposure.
Explore Which Groups Fit You
Your interests, background, school, network, and recruiting goals affect which areas may be the best fit. A tutor can explain the differences and help you discuss your interests convincingly.