Banking & finance law: area of practice
Banking and finance solicitors work on transactions involving the borrowing of money to fund a company’s activities, acquire a company or finance a construction project, eg a power plant or hospital. Litigation, corporate and regulatory issues also come into a banking and finance department. It’s transactional rather than pure legal advisory work.
Finance lawyers have an ongoing relationship with their clients, who are split between borrowers (investment funds, private equity or the government) and lenders (investment or retail banks, credit funds or alternative lenders). It is the lawyer’s job to negotiate the terms of borrowing and come to a position that works for both sides, for the length of that loan – be it five years or 25 years. It’s not as adversarial as, say, corporate work.
Leveraged finance transactions tend to involve short, sharp bursts of work, lasting three to four weeks at a time; you can expect to juggle two or three deals at once. They are intense: when you buy a house, you often encounter competition to buy that house, and people try to offer a cash bid quickly – it’s the same when buying a company.
On a typical transaction, you can expect the team to include a partner, a senior associate, a mid-level or junior associate, and a trainee. On large transactions, two or three partners work together and the size of their team increases. On international transactions, more junior lawyers may get involved to deal with numerous transactions.
Will you spend a lot of time at your firm’s offices as a banking lawyer?
Technology has meant that a lawyer’s time is weighted more heavily in the office than in face-to-face meetings. That said, finance lawyers get involved in a lot of client marketing, such as drinks receptions, lunches, table tennis or five-a-side football evenings, or training events.
Banking and finance work is often international. Travelling as part of the job does not happen so much if you are based in London since it is Europe’s financial hub. However, the reason I went into banking is the ability to travel to different offices: in my department, one of the partners was based in Sydney for two years and is now in Hong Kong; someone else has worked in Dubai and another colleague in Paris. A number of our trainees also spend six months working in a foreign office of the firm.
One of the reasons I like working in finance is that you work with specialists from other departments: corporate, real estate, tax and construction lawyers. We work in a high-octane environment with driven, intelligent people within law firms and client organisations.
Delivering a completed deal for your client is very satisfying. The nature of transactions can entail long hours and late evenings. These short, intensive bursts are usually followed by more regular working days. A junior lawyer may work until 10.00 pm or later at the height of a transaction followed by finishing at 5.30 pm once it’s over.
How does the state of the economy affect banking and finance work?
Banks stopped lending after the financial crisis in 2008, which resulted in a drying up of typical lending work. As a result, law firms diversified. Lawyers were instructed to restructure transactions when borrowers couldn’t repay. Other work involved advising banks on tidying up their balance sheets after the credit crisis. Banking law is always innovating, although the basic underlying principal of people borrowing money and repaying it never changes.
How much responsibility are trainee solicitors given?
Trainee solicitors carry out research on the company being acquired and on the company that borrows the money. They liaise with clients, manage finance and security documents (and the mechanics of getting documents signed) and, on international transactions, deal with their overseas counterparts and foreign law issues. There are a lot of opportunities for early responsibility for trainees, once they show they are good enough and that they’re happy to take responsibility.
The types of law banking and finance solicitors use in their job
Helen Burton is a partner in the finance department at Ashurst LLP and is also the firm's graduate recruitment partner. She graduated with a law degree from Newcastle University in 1991.