Debt Capital Markets interview preparation

Questions

100

Traced to a firm

45

Firms

26

Updated

September 2026

Asked at

All firmsTSTruist Securities5PIMCO4TD Securities4Apollo Global Management3Nomura3Scotiabank3Bain Capital2Houlihan Lokey2Mizuho2Neuberger Berman2Oaktree Capital Management2RCRBC Capital Markets2Carlyle Group1Deutsche Bank1Golub Capital1HPS Investment Partners1Invesco1KKR1Lazard1Moelis & Company1Moody's1Northern Trust1NUNuveen1Rothschild & Co1S&P Global1Wells Fargo Securities1

Topic

All topicsBond mechanics11Duration and convexity6Yield curve and rates5Credit spreads5Credit analysis and ratings13Credit modelling9Primary issuance9Syndication and loans10Structured credit7Covenants and documentation5Liability management5Indian debt markets7Fit8

Level

AnyCoreIntermediateHard

Type

AnyTechnicalBrainteaserMarket viewCaseFit

1. 044How do you get from enterprise value to equity value?Credit modellingCorephone / first roundTSTruist SecuritiesCorporate Banking · Atlanta · 2025

   Say this

   Subtract net debt and everything else that is a non-equity claim on the business. So enterprise value, less total debt, plus cash, less minority interest, less preferred stock, less unfunded pension and capitalised leases, plus the value of associates and other non-operating assets.

   Then walk it

   1. Total debt means all debt-like obligations, not just the bonds: bank debt, drawn revolver, finance and operating leases, securitisation, and any deferred consideration that behaves like debt.
   2. Cash is added back but only the cash you could actually take out. Trapped cash in a jurisdiction with withholding tax, or cash needed for operations, is not fully creditable. Most desks haircut it.
   3. Minority interest comes off because enterprise value reflects the whole consolidated business while equity value belongs only to the parent's shareholders. Associates and joint ventures work the other way: they are not consolidated in EBITDA, so their value gets added.
   4. Preferred stock, unfunded pension deficits and mandatorily redeemable instruments are all non-equity claims. Leaving pensions out is the single most common omission, and for an old industrial it can be a billion-dollar error.
   5. For a credit analyst the bridge is the same arithmetic used in reverse: you take a market or DCF enterprise value and walk down the claims to see how much cushion sits beneath your debt. That is the equity value, and it is your margin of safety.
   6. The limitation: the bridge is only as good as the debt schedule. Off-balance-sheet items — factoring, supply chain finance, guarantees — sit in the notes and belong in net debt even though the balance sheet does not show them.

   Where candidates lose it

   Reciting 'minus net debt' and stopping. The marks are in the other claims: minorities, preferred, pensions, leases and non-operating assets. On a corporate banking desk the pension and lease adjustments are the ones they actually use.

   Expect next

   • How would you treat an unfunded pension deficit?
   • Would you add back all the cash?
   • How does this help you size a loan?

   Reported by candidates at Truist Securities (Corporate Banking, Atlanta, 2025). Source: Wall Street Oasis.

Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.