Proposal
I am writing to seek funding approval to integrate a Debt Restructuring simulation into our analyst training program.
This initiative aligns with our commitment to enhancing the skills and capabilities of our analysts, ensuring they are well-equipped to excel in their careers.
As the financial landscape continually evolves, it is imperative that we provide our analysts with a comprehensive and practical learning experience. The simulation offers a unique opportunity for our analysts to gain hands-on experience in complex financial scenarios, enhancing their problem-solving skills and decision-making abilities.
Provider
Finsimco is a software provider specializing in gamified training simulations for investment banks. The company was founded by former investment bankers with origins at Morgan Stanley. For more information, visit www.finsimco.com
Benefits
- Engaging Learning Experience: The simulation offers an interactive and immersive learning experience that goes beyond our current training program. Our analysts will have the opportunity to apply their knowledge in a realistic, hands-on environment. This engagement is proven to increase knowledge retention and foster a deeper understanding of complex financial concepts.
- Real-World Relevance: The financial industry is dynamic and ever-evolving. By exposing our analysts to real-life financial scenarios, the simulation equips them with the practical skills and problem-solving abilities necessary to thrive in their roles. This relevance is key to their success and job satisfaction.
- Positive Feedback and Networking: Analysts who participate in engaging learning experiences tend to form stronger bonds with their peers and instructors. This sense of community can lead to a more positive learning environment and foster a supportive network, which is crucial for their overall experience.
- Professional Development: Integrating the simulation into our program not only enhances our analysts' technical competencies but also contributes to their professional development. This added value can lead to higher job satisfaction and a sense of accomplishment, reducing attrition rates.
- Assessment: The simulation supports effective assessment of analysts’ knowledge and skills. The performance data allows us to optimize staffing decisions.
Key statistics
- 80% of staffers agree that Analysts are better prepared for the desk after the simulation.
- Excellent ratings: 93% of participants rate the simulator experience as "excellent."
- 85% of staffers find that the simulation results align with employee performance.
Debt Restructuring simulation
Url: https://www.finsimco.com/banks/simulations/debt-restructuring
Duration: 2 hours.
Setup:
- Analysts are organized into teams, each consisting of 3 to 5 members.
- Teams are tasked with working on an out-of-court debt restructuring case, representing different roles such as 1st lien debt holders, 2nd lien debt holders, and equity owners.
- The difficulty level of the simulation adjusts based on performance.
Grading: Assessment is based on the teams' ability to reach an agreement, as well as the practicality and favorability of the terms they agree upon.
Concepts:
- Debt vs. Equity Financing
- Impact on Stakeholders
- Debt Negotiation
- Financial Distress
- Bankruptcy
- Legal Considerations
Learning Objectives:
- Understand the underlying difference between debt and equity in the face of financial challenges
- Understand financial distress and the perspectives / incentives of creditors, management and equity owners
- Identify the key players in a restructuring, including vulture/distressed asset investors
- Definition and indicators of financial distress
- Detect an unsustainable capital structure
- Discuss creditors' and equity owners' rights during a restructuring and bankruptcy
- Evaluate the options available to lenders and investors when signs of credit deterioration become apparent
- Understand legal and regulatory frameworks related to financial distress
