What is banking and finance law? A guide for aspiring solicitors

The range of lenders that banking lawyers work with has expanded over the years to include more non-bank institutions such as credit funds and insurers. On the other side of a deal, as most companies use debt finance, there is almost no limit to the industry in which borrowers may operate.

Over the last 18 months, changes to how financial institutions operate have generated lots of activity. Lawyers have been getting to grips with the replacement of the London Inter-Bank Offered Rate as the benchmark for interest rates on financial products, as well as the increased use of technological solutions to create cost efficiencies.

Looking ahead, as borrowing costs rise and central banks raise interest rates, there’s the expectation of an increase in financial distress and insolvency-related activity. Read below to find out more about banking and finance for aspiring solicitors with this contribution from Nick Wong , a partner in the global loans practice at Ashurst LLP . He graduated from King’s College London in 2001 with a degree in law.

• What is banking and finance law?
• What do banking and finance solicitors do?
• What is life like as a banking and finance trainee?
• What skills do you need to be a banking and finance solicitor?
• Types of law practised within banking and finance
• How much can I earn in banking and finance law?

What is banking and finance law?

Banking and finance lawyers advise and act on behalf of the borrowers or lenders during a financial transaction. Lawyers are tasked with ensuring that the deal runs a smooth course and is successfully completed within the given time frame.

Deals tend to be cross border and can involve, for example, loans financing a private equity acquisition or general liquidity facilities.

What do banking and finance solicitors do?

A typical transaction will be led by a partner, and supported by one or more associates and a trainee. A team will usually need support from other specialists, such as tax or insolvency lawyers, depending on the deal.

Drafting will usually take place in the office, but external meetings may be held at clients’ offices to discuss the terms of a transaction and negotiate documentation.

Depending on the specialism, banking lawyers may work on a single deal at a time, or they may manage several transactions simultaneously. Client requirements and the purpose of the financing dictate the timeline, but transactions can last anything from a few days to several months. If time is of the essence, such as when staving off a corporate insolvency, lawyers must progress swiftly to bring about the best outcome for the client.

Working hours change by the client and deal but, considering the international nature of the work and the large sums of money often involved, lawyers can expect to work increased hours at key stages of a transaction. This occasionally includes weekends or working late into the night. Equally, during quieter periods the hours can be more regular with early finishes.

What is life like as a banking and finance trainee?

The importance of building and consolidating client relationships cannot be overstated. It should form a regular and ongoing part of the job, and lawyers can be expected to spend a portion of their time with clients outside of the office to develop new business. Each lawyer has their own preferred method, but it is common to attend work or social events or to offer training initiatives. With clients often located overseas, there can be opportunities to work on deals in other jurisdictions for qualified lawyers, and overseas secondments for trainees.

Along with responsibilities such as drafting security documents, attending meetings and co-ordinating conditions precedent, trainees will also be exposed to a high level of client contact from day one. Trainees are expected to take responsibility for specific aspects of a transaction dealing directly with counsel acting on the other side.

What skills do you need to be a banking and finance solicitor?

Excellent commercial awareness and an interest in the global economy are key for aspiring banking and finance lawyers. You’ll also need sound black letter law, good drafting skills and an excellent manner with clients.

If you are resilient, organised and enjoy new challenges working as part of a team, then you can thrive as a banking and finance lawyer.

Types of law practised within banking and finance

• Contract
• Tort
• Product liability
• Employment

How much can I earn in banking and finance law?

You will likely undertake banking and finance law as a seat on a training contract as part of a rotation and may specialise later. You can take a look at our article on How much you can earn as a trainee solicitor to get a broader picture of how much law firms pay trainees, but it’s not uncommon for firms with UK offices to offer £50,000 to trainees in their first year, rising to anywhere up to and above £100,000 upon qualification.