Alishahal Macknojia
University of Houston
Houston (29.7° N, 95.3° W)

featuring Amber Lo, corporate credit analyst, Bank of America Merrill Lynch, Dallas (32.7° N, 96.7° W)

Amber Lo is a corporate credit analyst at Bank of America Merrill Lynch. She graduated from Rice University in 2017 with a BA degree in economics and managerial studies and a minor in business. Over the course of our conversation, Amber and I spoke at length about her background, day-to-day duties, and the direction she thought credit risk was headed.

As an undergraduate student, Amber was encouraged by mentors and through hands-on learning experiences to pursue accounting and mathematics. As an accounts payable intern at Sonic Air Systems, she discovered firsthand how data-driven accounting could be, which led her to seek out a career in finance. Leading up to her current role, Amber developed analytical and technical skills through her experiences as an associate financial analyst at Fractal Labs in London and as an investment analyst with the Rice Finance Group.

Some of the responsibilities that Amber holds as a corporate credit analyst consist of underwriting and monitoring loans for multinational companies and negotiating terms for ancillary cash management and traded derivatives products. Understanding the company’s operating history, management, and key risks is critically important when considering whether to extend credit. When we discussed the different groups and organizational structure of Amber’s company, I found it very informative that the skills are similar across different groups and that there is a clear structure to the work of the analyst, associate, and the vice president in each group. Before our interview, I had the impression that analysts were pigeonholed into specific industries and was surprised to find out the scope of different clients in a portfolio. I was glad to have cleared up some of the job-related misconceptions I had about credit risk.

Nearing the end of our discussion, I was very pleased with the answer Amber gave about where she thought the future of credit risk lies relative to changes in her role. I recognized that this was a tough question to answer since it was a complete hypothetical guess into the future. The parts that caught my attention were when she mentioned that there has been an outsourcing of financial analysis and a consolidation of teams to create efficiency. With decreasing demand for analysts, organizational leaders want to maximize an employee’s value by adding new responsibilities to the same positions. I appreciated that Amber tied it into what future college graduates can expect to see from the role and the changes to portfolio management and underwriting in the next five or 10 years. What I took away from her answer was future graduates would be entering a highly competitive but interesting field.

Highlights from the interview:

Everyone’s family, community, and life circumstance create an initial role for them in society. What was expected of you? Did you adhere to it, or did you stray from it?

Both my parents studied finance and got their MBAs right after graduation. My parents encouraged me to study accounting and focus on math, and I did find that to be my best subject. When I was in college, I got an opportunity to further my technical skills in an accounting internship. I worked in the accounts payable department in a small company that sold factory equipment, and it was a good experience because I realized that it was very technical and involved a lot more data analysis than I expected, which ultimately made me think I wanted to do something slightly different. Because of that, I started pursuing finance.

At Rice, they don’t have a robust undergraduate business program, they just have a business minor, and so I didn’t have a very strong finance background until I started interning at other companies. I saw that finance was a really broad field and I could go into a lot of areas within that, and I liked the detail-oriented, logical thought process involved, which was what drove me to my current job.

Did you have anyone that acted as your mentor who cultivated your interest?

I have to say this [was] probably my aunt. She was the one who connected me with my first internship as a freshman in that accounts payable position. As a freshman, it is difficult to get internships because companies always want to hire juniors and give them return offers so they can start right after graduation. So I was really grateful that she found that opportunity for me, as she did encourage me to look for positions that used my skills. My aunt was an important mentor for me—she gave me industry research and books to read and always talked to me about what she’s working on. She was the CFO of her company and had been in finance for several decades. She really inspired me and got me excited about that field because I probably wouldn’t have gotten a chance to learn more about the inner workings of a company if she hadn’t openly shared about her thoughts about the job. She was also helpful in connecting me with other contacts that I jumped on a call and had informational interviews with, like this one right now, that helped me figure out why I wanted to go into finance as well.

What led to your current position, and what does the position entail? If possible, could you give me an hour-by-hour rundown of your typical day?

Rice has a really great career center, and we were able to interview on campus. So I did apply [to jobs] through the online portal, and I went to a bunch of information sessions before then with various banks—JP Morgan, Wells Fargo, et cetera—because I wanted to learn more about what they do, the day to day and how I would fit into the process. I wanted to find a role that did involve a little client interaction, so I wouldn’t just be sitting in my cube all day, but [one that] would allow me to directly help customers find solutions to their financial problems. I applied for an internship at Bank of America’s wholesale credit division and received the return offer at the end of the summer, and that is where I still am two and a half years later.

My current role is underwriting and monitoring loans in the global corporate and investment banking division. In addition to structuring loans and determining pricing for credit facilities, we also offer cash management services and manage their derivative trading by working across all groups in the bank including sales, corporate banking, investment banking, and operations. Getting to engage with different product partners has been very interesting to me because no two days are the same. I would say every day, there is a new transaction request and you’ll need to figure out why the bank would be comfortable with that client, so every transaction is a new challenge.

So my day to day…We have a team meeting about once a week, so we would have those in the morning typically. I would go through my emails, read The Wall Street Journal, get up to date on the news, and then I usually go through my portfolio and see what deliverables we have due that day. If we’re working on structuring a new loan facility or approving trades at the company, I’ll have various meetings with a VP, other groups within the bank, and the client themselves to negotiate terms and determine what exposure we’re comfortable with within our risk profile, and what covenants we need to put in place to ensure repayment in case the company defaults. As analysts, we’re responsible for creating credit documents that will cover company financial analysis and key risks, in addition to reviewing the bank’s exposure to a company on a regular basis. We enforce strict deadlines in which companies must send us a compliance certificate and financial statements within a grace period by the end of the fiscal period, which we review and ensure that they are within limits.

What do you think was the most important thing that you learned as an undergrad that you apply to your current position?

Many of the business classes that I took that were relevant to what I’m doing now taught us how to view companies’ business models and financial performance with a critical lens, but I benefitted most from learning how to communicate effectively and clearly, which, in my role, it’s important to format your analysis and structure your argument to make a strong recommendation to drive decision making. I think being very resolute in your stance is important because you don’t want to be seen as wishy-washy. You want to make a strong case and stick with it. In terms of the most useful courses in undergrad, that would probably be my financial accounting class and then my corporate finance class. In those classes I learned concepts that I use pretty much every day when we’re looking at companies.

It seems like you learned a lot of soft skills at Rice, but most of your technical skills came from on-the-job training, is that correct?

That is correct. I was an economics-managerial studies double major, but really my econ classes were purely theoretical. It would have been useful if I had gone into that field, but I decided to go into finance. So I am very thankful that my job had a strong training program.

Do you think there are any misconceptions that people have about your job? 

Well, the first and very basic [misconception] is when I tell some people that I work at Bank of America, they assume I work at a local branch servicing individual customers. However, my division only serves multinational corporations, a division which actually has a larger loan book than the consumer banking division. I think people also assume that credit is a role that involves a significant amount of back-office work, which is partly true as we aren’t as client facing as corporate or investment bankers.

However, we do work very closely with many teams, and we get good interaction with clients, usually the treasurers and CFOs. We go on diligence meetings, meet the clients face to face, talk about what their issues are, and how we can help solve them.

Can you describe the dynamics of a team that works on a project, in terms of structure, organization, and any other important characteristics?

For every client in our portfolio, we have three credit coverage associates assigned. There is an analyst, a vice president, and a portfolio monitoring associate. And within that team, I think the work split is very clear, which I do appreciate that structure.

The analyst does company research and pitches recommendations to the VP. The VP will take that and present information to our internal partners or to the clients themselves. The portfolio monitoring associate will assist with paperwork and ensure our internal records are updated. My industry overall team is pretty small, I think there are 10 of us. We’re within a larger group that covers US companies, and then we have our counterparts in Asia, Europe, Africa, et cetera. So we can reach out to them anytime and ask for help, which is useful.

You work on the wholesale side. What is the difference between wholesale and commercial credit risk?

I think that is a term that we use, so I guess instead of saying wholesale credit, I could just say I work in corporate credit, versus commercial credit. So corporate credit covers large, mature, established companies. Commercial credit would cover smaller businesses that may not be global and may not be name brand. And because we get to cover such large companies, we’re able to work on transactions in the hundreds of millions of dollars. We sometimes get to see our companies make the news if they were merged with or acquired by another firm, which may then involve bridge financing, and seeing how high profile these transactions are is pretty rewarding.

What aspects of Bank of America Merrill Lynch, such as company culture or support for professional growth, make it stand out as a great place to work?

The first thing would be their training program. They did a three-week program in their headquarters going over the basics of accounting, bank processes, policies, and that was really helpful because we got to network and meet people from all over the bank and make connections from day one. When I got back to the office, we had peer coaches that were assigned to me and showed me how to use systems and answer any questions that I had. They were all very patient. And I think that the work culture there is great, and everyone has a team mentality. They’re willing to offer help even if they’re busy. We have a pretty young team as well, so everyone is friends outside of the office, too.

I also think that this job offers great work-life balance. My hours are not as crazy as investment bankers in the way that we can still go home on the weekends and not have to worry and stress about work 24/7. You can still do things after work. Once in a while, when [your] workload gets busy, you’ll have to stay late and work a few weekends.

That’s pretty interesting. What little I know about credit risk from the past few years, there seems to be a lot of regulation impacting things, especially with trading and counterparty risks. Do you see a greater demand for analysts who can analyze these risks, and do you expect your role in industry to change in the next five or 10 years?

I would say it really depends on the industry because our team is divided by industry rather than by region. So because our industry has been going through a lot of M&A and our portfolio has changed, and processes are getting automated and outsourced, there has been less demand for as many analysts as in the past. However, our work responsibilities do fluctuate, and the number of people on our team does accordingly. 

We used to outsource some of our functions including financial spreading, which is inputting financial statement data into our system. I know that some banks are sending off their financial analysis every quarter to companies in India, because of the lower cost of labor. I think it really depends on what bank.

What advice would you give to a student interested in your field? Is there anything unique that college students or young professionals can do to separate themselves from the crowd?

You have probably heard this one before, but I would say finding mentors is huge to helping you find what you’re passionate about. The opportunity to hear from someone who is in the industry, and knowing their day to day, helps guide your decision a lot more than just reading about it or hearing about it in school. You should get the information from someone who has actually done the job before.

Another point is getting as much internship experience as possible. I realize now that as I’m also doing recruiting for my company, there is a lot of emphasis on what experiences they have had in the past, are they a go-getter, are they pursuing as [many] opportunities as possible? So, if you’re looking at a role that you aren’t sure about, [an internship] is a good way to figure what you’re passionate about and also have something tangible to discuss when people ask about your prior experience.

And I’ll also say go to as many info sessions that your school offers as you can. I have gotten to meet a lot of people that way who have also referred me to other positions before. Go to info sessions [for] positions you didn’t think you’d be interested in, rather than limiting yourself to preconceived notions about an industry.

What keeps you motivated?

I really enjoy talking to people, getting to know their stories and what drives them. I think making connections every day is really important to me and actually motivates me. So that’s why I’m happy to have a job where I get to talk to people all day. And after work, I prioritize catching up with friends. That’s why I didn’t want to take the accounting position, because it was pretty isolating, and I didn’t feel like I had a chance to learn from other people and interact as much. Because that aspect was important to me, I had to find a position that also accommodated that.

Is there anything that I asked, or didn’t ask, that sparked anything that you’d like to mention?

Another piece of advice I could share is that you may not know exactly what career pathway you want until you’re actually in a job and realize you do or don’t like it. So it’s important to not put so much pressure on yourself as a student to figure that out from the get-go because there is a lot of pressure that you receive from other people to figure that quickly. And I think I wasn’t able to really figure that out until I started my first job as well. Know that it might take you a couple jobs to get to where you want to be, and that’s okay.

Interview excerpts have been lightly edited for clarity and readability and approved by the interviewee.