Any lawyer working in the financial markets space needs to keep their finger on the pulse and distil the subtle differences between matters. Here four lawyers from Jones Day explain how you can kickstart your career in this global and multifaceted area.
Chambers Associate: How would you describe Jones Day’s Financial Markets Practice?
Dickson Chin, partner, New York: We are a full-service global Financial Markets Practice. Clients benefit from a collaborative approach and deep understanding of the banking and financial markets. Over 300 lawyers advise on the full range of complex cross-border financial transactions, regulatory matters, investigations, and litigation.
We represent a diverse client base of global financial institutions, issuers, borrowers, funds, asset managers, and fintech companies. We have helped them close more than $1 trillion in financing transactions over the last five years, including many precedent-setting financings. Our deep regulatory bench has advised on compliance, investigations, and enforcement issues across the globe. We counsel clients in sophisticated financial products litigations, including structured finance, derivatives, and class action litigation.
Brittany DePeder, associate, Columbus: Unlike a lot of firms that tend to lean toward either lender side representations or borrower side representations, Jones Day does a pretty even split of lender side work and borrower side work. This variety keeps things interesting for our lawyers, but it also helps inform our lawyers of current trends in the market. Another hallmark of the Jones Day financial markets practice is our global presence and “One Firm Worldwide” approach. I can’t think of a single deal I have worked on that didn’t involve lawyers from multiple Jones Day offices, and the ease with which our lawyers collaborate has always been something that has impressed me and made me proud to be a part of Jones Day.
Hannah Fregolle, associate, Chicago: Comprehensive. Our financial markets practice is designed to respond to the interconnected nature of our clients’ needs. We have transactional attorneys, litigators and regulatory attorneys ready to address any issues our clients face in a coordinated and thorough manner. The depth and breadth of our practice has stood out over the last few years as we have worked with clients to navigate multi-faceted, complex issues in undeniably challenging times.
"A more holistic, integrated approach allows the firm to ensure that client needs are met by putting under one umbrella the attorneys whose experience covers all aspects and stages of financial transactions and regulatory matters."
CA: How did the practice come about and what are the benefits of structuring it in its current form?
DePeder: The combination of various subgroups into one financial markets practice was largely client-driven, meaning we believe we most efficiently and effectively serve our clients with this structure. We are able to seamlessly connect with the relevant experts across the various subgroups to address client matters. Our regular practice calls help to keep our lawyers apprised of the latest developments in the various subgroups so that we are able to issue spot and enlist the relevant subject matter experts when necessary.
Anthony Masero, associate, Boston: The practice came about through the insight gained from the firm’s depth of experience working with financial institutions. In addition to the banking and finance, deal-focused practice group, Jones Day also had a longstanding group of litigators focused on representing financial institutions in disputes, investigations, and regulatory matters. The firm realized that, as client needs were evolving, the firm needed to adapt as well. A more holistic, integrated approach allows the firm to ensure that client needs are met by putting under one umbrella the attorneys whose experience covers all aspects and stages of financial transactions and regulatory matters.
Fregolle: Our deal teams are built leanly with those best suited to help on a particular matter, so our work is not constrained by the geographic boundaries of industries. Jones Day lawyers do not need to be in California to work with big tech, New York to work with the banks, D.C. to work with government/regulatory agencies, the Southeast to work with the oil and gas companies, or the Midwest to work with the consumer goods and agriculture companies.
CA: How does collaboration between the subgroups occur within the financial markets practice?
Chin: Clients do not look at problems by subgroups or practices. They want answers to their problems and our structure enables the firm to bring to bear the scale and sophistication of our legal skills in an integrated manner. It is something that our clients have grown to expect from us.
DePeder: It is not uncommon for our borrower-side deals to have both a bank and bond component. Similar issues may arise and similar analysis may be required on both sides. Lawyers within our subgroups (and the firm generally) frequently and effectively work together to address client needs.
Fregolle: We do not view the differences in each of our practices within the financial markets practice as “subgroups” – while we all have certain areas of focus, we actively work together as a group to respond to client needs. While the makeup of the team depends on the specific client request at hand, the nature of our practice, and all the practices at Jones Day, is one holistic team driven by the needs of our clients.
Masero: Collaboration occurs in a variety of ways. Members of the practice group are regularly communicating with each other on a group-wide basis. By having lawyers keyed in on matters related to (i) deal work (e.g. trends in contractual language, deal structures, etc.), (ii) regulatory matters, and (iii) the nature of lawsuits being filed, all in contact with each other, Jones Day attorneys with deep experience in one area are nonetheless familiar with significant developments across the financial services industry. As a result, financial markets attorneys also know who in the firm has deep experience in particular areas. So, when working on a pitch or a case, the attorneys are well-positioned to determine how to most effectively and efficiently deploy firm and/or client resources. As a result, a client can have a high degree of confidence that Jones Day will have the most complete understanding of the matter’s implications in all areas of the client’s business.
"Environmental, Social, and Governance (ESG) are the main factors in determining whether a company, investment, or country is sustainable, responsible, and ethical. They are driving long-term investment decisions, transactions to reduce emissions and shareholder engagement."
CA: Is it possible for attorneys to move between the subgroups?
Chin: Our lawyers are actively encouraged to participate in multiple subgroups. We also expect our lawyers to become knowledgeable of developments occurring in all of our subgroups. The goal is to make sure everyone has sufficient knowledge about the broader financial markets and what our clients need in order to identify the lawyers across the globe who can address the problems our clients are facing. To facilitate this process, twice every month we convene a meeting of all of the subgroups within the Financial Markets Practice to share developments in each of the subgroups.
DePeder: Junior lawyers in the financial markets practice at Jones Day are expected and encouraged to gain experience with both the traditional capital markets side and the traditional lending side. These experiences contribute to more well-rounded, versatile lawyers who are easily able to transition from one subgroup to another.
Fregolle: Formally, yes, absolutely. But like much at Jones Day, the formal title of your group matters less than the experience and knowledge that you bring to the team. Teams at Jones Day are built with skills in mind, not necessarily formal practice group labels. Importantly, experience and knowledge grow over time, evolving with changing global/political/economic climates, and the structure of practices at Jones Day is set up to not inhibit that growth.
CA: What factors are currently driving financial markets work?
Chin: Here are some of the factors currently driving the financial markets:
- The war in Ukraine has created a humanitarian crisis affecting millions of people. Companies are asking how they can protect their employees and address their investments and assets in Ukraine, Russia, and surrounding countries.
- Environmental, Social, and Governance (ESG) are the main factors in determining whether a company, investment, or country is sustainable, responsible, and ethical. They are driving long-term investment decisions, transactions to reduce emissions and shareholder engagement.
- Fintech is changing the way companies raise capital, borrow money and make payments. The impact of Fintech is felt across a wide range of industries and is altering the landscape of consumer behaviour and expectations. It is fundamentally transforming the way financial services operate.
DePeder: Interest rates have certainly been a driving force recently, and we have also seen recent borrower-friendly trends related to relaxation of covenants in financing agreements.
Masero: Many things. The metaverse, cryptoassets, and distributed ledger technology challenge existing regulatory regimes and deal structures. Financial distress from COVID followed by the war in Ukraine have put stress on a variety of (or really all) asset types. Looming in the not-too-distant future are another down credit cycle and a perhaps a profound reorganization of American society and cities in a post-COVID, more “work from home” friendly world that could place significant strain on commercial (and as a result, residential) mortgage products.
CA: What are the biggest challenges for lawyers and their clients in financial markets?
DiPeder: The pace at which clients expect us to close transactions has been increasing for years, and we have to strike a delicate balance between sufficiently addressing legal issues on realistic timelines and being responsive to client needs, including deadlines.
Fregolle: Balance of interests and considerations of various stakeholders has been a recurring theme over the last few years. With businesses and clients being pulled in many different directions in challenging and uncertain times, navigating the decision points and balancing the various factors at play has been at the forefront of clients’ minds and where we come in to assist.
Masero: In recent years, it is the rate at which things change. From one presidential administration to the next, the scope of new regulation and enforcement changes dramatically. COVID upended just about everything for over two years and the real economic fallout is probably yet to arrive. Add to that the war in Ukraine, rising inflation, technological “disruption” in the financial sector, and the fact that all these considerations intersect with each other. A financial markets lawyer increasingly needs to be well enough versed in all these areas to understand a financial institution’s big picture concerns.
"A larger number of problems may find technology-based solutions, so financial markets should be staying up to date on crypto, fintech, blockchain, and NFTs."
CA: How do you see the financial markets practice evolving over the next few years?
Chin: Our practice is forward-looking and we must continuously strive to maintain our thought leadership by identifying the factors that will drive the financial markets going forward. It is critical to help our clients stay in front of, rather than just react to, changes that will shape the future of the industry.
DiPeder: We have started to see an increased focus on ESG metrics, and we expect that trend to continue.
Fregolle: One of the clear takeaways from the past few years (and at various other points in recent history) is that direct consequences and related ripple effects from global events or movements shape the regulatory environment, investor sentiment and confidence and business performance. All these factors influence the work we do. Structurally, the firm and practice are set up to evolve seamlessly alongside these trends, which provides the foundation for our teams to address any client needs as they arise and continue to evolve alongside our clients. The multi-faceted, inter-connected nature of the issues our clients will continue to face requires us to continue to remain nimble, adaptable and practical.
Masero: As noted above, the real fallout from COVID is likely yet to arrive. Not the “direct” financial impact, but the way the world of finance will change because of the way society has changed or is changing. There will be more financial distress, more litigation. One could also reasonably expect continued dramatic swings in the legislative / regulatory agenda with each subsequent administration. A larger number of problems may find technology-based solutions, so financial markets should be staying up to date on crypto, fintech, blockchain, and NFTs – regardless of their personal views on the value of such things.
CA: How can students keep up to date with trends in financial markets?
Chin: My advice for younger attorneys is to always feed your curiosity by reading far and wide (and viewing insightful videos). It can help you identify future problems to solve. I first became aware of the challenges posed by climate change through the Al Gore documentary and the Intergovernmental Panel on Climate Change Report around 2006-2007. My curiosity then led me to read about the newly-emerging areas of renewable energy certificates and carbon credits, which translated into my first transactions in ESG.
DiPeder: There are an astonishing number of resources available, but I would recommend tracking publications by law firms. Those articles usually aren’t too lengthy and generally seem to capture issues at a high level that students could easily understand.
Fregolle: Read or watch the news. As the financial markets are directly impacted by current events, staying on top of those events and understanding their significance supports better understanding of the business and disclosure realities our clients face.
Masero: Students should read the relevant sections of their preferred newspaper and also read the Financial Times. Depending on particular areas of interest, other more specific sources may be worth subscribing to as well – the Block or Asset Backed Alert come to mind.
CA: Can you run us through a highlight matter you worked on? Why did it stand out to you?
Chin: I recently led the Jones Day team that advised the International Swaps and Derivatives Association, Inc. (ISDA) in the publication of the U.S. Renewable Energy Certificate Annex (REC Annex). The REC Annex is innovative because it allows companies to buy and sell renewable energy certificates based on standardized product definitions and terms. It is part of ISDA's broader efforts to mobilize the $10+ trillion derivatives industry to provide funding for renewable energy projects and to help market participants meet their ESG goals.
DePeder: Recently, we represented Simpson Manufacturing Co., Inc. in connection with its acquisition of the Etanco Group, a French-based company. To finance this acquisition, Simpson Manufacturing doubled the size of its existing credit facility. The transaction was interesting because of the French aspects of the deal, which influenced the structure of the deal and certain aspects of the financing related provisions in the purchase agreement. Our US and French teams worked very closely given the nature of deal so it is another example of the value of our “One Firm Worldwide” approach.
Fregolle: I recently was part of the team that represented Peabody Energy Corporation in connection with a series of financial transactions to support near-term liquidity requirements related to economic coal hedge positions in the wake of the Ukrainian/Russian conflict. This series of transactions stand out as an embodiment of what Jones Day brings as a partner to our clients – quick to mobilize, seamless work across areas practices and offices, comprehensive command of the situation and deep understanding of the client’s business and legal needs.
Masero: I worked on a motion to dismiss in a putative class action suit alleging violations of usury laws premised on true lender / valid-when-made theories. Plaintiffs asserted that they were charged an illegal interest rate because a set of student loan securitization trusts were not entitled to the pre-emption of state usury laws under the National Bank Act. We had been closely following true lender / valid-when-made issues across our various subgroups, and I had assisted in the publication of a number of related articles.
The case was in many ways a matter of “first impression” based on the type of transactions at issue. Moreover, regulators were actively promulgating rules addressing both the true lender and valid-when-made issues while the litigation was pending. We demonstrated our ability to adapt to changing circumstances and ended up winning the motion to dismiss outright.
"I always try to “helicopter out” and understand the broader context of any situation."
CA: What is the day-to-day work like in your subgroup?
Chin: Whether I am advising a client on taking potential actions, drafting an agreement or engaged in negotiations, I always try to “helicopter out” and understand the broader context of any situation. This helps to address the root cause of a problem to systematically prevent and solve for underlying issues, rather than supplying ad hoc remedies or putting out superficial fires. It also makes the work more interesting.
DePeder: We spend a great deal of our time drafting and negotiating the relevant loan documents, and this is accomplished with extensive communications with our clients, opposing counsel, our corporate team (in the case of acquisition financings) and our colleagues who are experts in the relevant subject matter areas (e.g. environmental law, cybersecurity and real estate).
Masero: My work covers a variety of matters of different types. While I am primarily a litigator, my work, on a daily basis, touches on regulatory issues and transactional issues as well, due to our familiarity in structured finance products. My work involves leading calls, conducting research, drafting memos and briefs, and may also involve revising transaction documents. I also stay involved with the firm’s business development efforts in a variety of additional areas from FinTech to ESG.
CA: How can lawyers build a career in financial markets?
Chin: When selecting a subgroup within the financial markets practice, you should observe the work done by mid-level associates in a particular subgroup and consider whether you are interested in that work. Looking up to mid-levels as a new lawyer should provide you with a good glimpse on your potential work in the near-future.
DePeder: The legal profession, especially with respect to the transactional practices, is certainly demanding and often unpredictable. In order to make a career in financial markets work in the long-run, I believe that you need to surround yourself with the right people, those who are truly interested in and supportive of your development.
Fregolle: Seize new opportunities as they arise. Financial markets are constantly evolving, as are our clients within the space. The financial markets practice is no different. New regulations, trends and movements, and evolving business environments, shape our clients’ businesses and everything they face, so keeping an open mind and reaching out to seize on new learnings and opportunities will greatly benefit career growth.
Masero: Just dig in. I have a background in theatre and philosophy. I had no experience with complex financial instruments whatsoever before becoming an attorney. The whole of my banking experience stemmed from seven months as a bank teller before law school. But I took an interest in the work and put in the time.
At Jones Day, people will give you the tools you need to succeed. It can be a steep learning curve (it was for me) but commitment and discipline will lead to more responsibility on more interesting and challenging matters.
CA: What is the most exciting aspect of being a lawyer in this area?
Chin: I enjoy working with a team of dedicated and talented lawyers. Collaboration is at the heart of nearly everything we do in our financial markets practice at Jones Day. We believe – and experience has proven – that our clients are best served when they have access to the talents of all of our lawyers throughout the world. That is why we reject silos and insist upon putting the interests of our clients and the firm as a whole above parochial personal, practice, or office interests.
DePeder: It is always fun and interesting to be involved in complex transactions for large, well-known companies that everyone hears about.
Fregolle: The changing landscape. One of the most exciting and challenging – sometimes sobering – things about our practice is that current events directly impact all aspects of financial markets work. Whatever is going on in the world – whether that be a global pandemic, supply-chain collapses, military conflict, unprecedented inflation, change of political administrations or prioritization of ESG considerations – directly impacts the ability of our clients to raise capital and shapes how they conduct their business.
Masero: The last few years it has felt like everything is changing all the time. I think financial markets lawyers get to learn more about diverse subjects now than they ever have before – they have to, really.
"Always keep the big picture in mind."
CA: What’s the most valuable lesson you’ve learned in this area so far?
Chin: Become a problem solver. The starting point is to focus on technique and keep your eye on the big picture. Like music or sports, you can attain tremendous heights from observing with great attention to detail the specific technique and methods of others who excel at their practice of law. With these tools, you can then relentlessly practice and prepare for your own big moment.
DePeder: Hard work and the occasional long night do not go unnoticed or unrewarded (by both the firm and our clients).
Fregolle: Always keep the big picture in mind. The big picture can mean the timeline, structure or goals of a deal, the understanding of which helps keep a transaction on track. It can also mean the underlying policy reasons for rules, regulations and guidance, an understanding of which can help those rules make sense and the team better implement them. And it can mean a client’s business and industry dynamics, internal structure and culture, the understanding of which can further help the team understand and serve the client’s needs.
As a bonus valuable lesson: stretch opportunity moments are where you learn the most.
Masero: Trite but true: It’s the details. In the structured finance space, we deal with a huge volume of transactions, some of which are 90% or more the same. But paying close attention to small differences can clue you into interpretive issues that may not be apparent from reading the language in one deal.
CA: What experience could somebody gain to figure out whether they might be suited to working in the financial markets space?
Chin: Read and learn about business and the way the economy works. The most important quality at all levels of practice for a financial markets lawyer is an interest in business and its real-world impact. There is no substitute for enthusiasm and curiosity.
DePeder: Law school classes and the law school experience do not really offer much insight when it comes to practicing in the financial markets space. In my experience, the most helpful information and understanding comes from speaking with lawyers in the space and participating in hands-on experiences, like internships and summer associate positions. At Jones Day, first year associates go through the New Lawyer Program where they are given the opportunity to explore various practice areas before committing to a particular practice area. It was through this program that I learned of my great interest in the financial markets practice, and I still have great appreciation for this program as a result.
Fregolle: Much of what we do is learned on the job. It never hurts to have taken some accounting or business law classes, mainly just to familiarize yourself with the terminology and to see whether you are interested in the space (I would suggest seeking some of those out in business school, if available). Importantly, you should be interested in financial markets, so getting yourself acquainted with what is going on in the world and how that impacts businesses is a great first (and continuous) step.
Masero: For me, it was assisting with a brief. The challenge of a disciplined, technical reading of such complex contracts was something I felt like I could find fulfilling for the rest of my career. When your work requires you to parse the details, no two matters are ever quite as similar as it might seem, even when they involve similar financial products.
CA: What advice do you have for students considering a career in financial markets?
Chin: Ask questions. The best way to learn and grow is to ask questions because it forces you to look at the bigger picture and understand your role within it. At every level of your career development, remember that you have the power to contribute to a winning team effort.
DePeder: So much of the training for a financial markets lawyer comes in the form of on-the-job training. However, the training process can be so much smoother, stronger and more efficient if a person has a solid foundation consisting of the fundamental skills that are required for all lawyers, regardless of practice area (e.g. critical and creative thinking, attention to detail, effective communication and taking initiative). There is no need for students to wait to work on these foundational skills. The ability to build and maintain relationships is key to a lawyer’s long-term career success, and students can start making connections now that will serve them well in the future.
Fregolle: Figure out whether you find financial markets (not necessarily the legal practice of financial markets, but the markets themselves) interesting. The legal practice is our way as lawyers of interacting with the financial markets, but fundamentally, for a rewarding career, you should be interested in them. Read some earnings releases, turn on market-related news (there are some entertaining choices in the morning) and find out whether the stories covered by the Wall Street Journal interest you. Next steps should come fairly easily after that.
Masero: Give it an honest shot, pulling work in from one or two subgroups. I think the functional areas are different enough that just about everybody can find something that appeals to them. Use the knowledge you gain in those one or two areas and start to explore one or two more. The perspective you might bring as someone who has focused on different products, regulators, cases, etc. might really make an impact.