Investment Banking interview preparation
Every question below is either traced to a named firm from a public candidate report, or tagged at desk level when we could not trace it. Answers are written the way you would actually say them out loud — answer first, then the mechanism, then the limitation.
100 questions, mapped to the firms that asked them
- Questions
- 100
- Traced to a firm
- 100
- Firms
- 46
- Updated
- September 2026
018What is WACC and how do you calculate it?CitiGeneralist · New York · 2026
Say this
It is the blended after-tax cost of a company's capital, weighted by the market value of each piece. Cost of equity times the equity weight, plus after-tax cost of debt times the debt weight.
Then walk it
- Cost of equity comes from CAPM: risk-free rate plus beta times the equity risk premium, with a size or country premium if the situation calls for it.
- Cost of debt is the yield the company would pay on new debt today, not the coupon on its old debt, and you multiply it by one minus the tax rate because interest is deductible.
- Weights use market values, not book. Market capitalisation for equity, and market value of debt, which for most investment grade paper is close enough to book.
- Use target capital structure rather than today's snapshot if today's is temporarily distorted.
- The honest caveat is beta. It is estimated from noisy historical data, so I would cross-check against a peer set rather than trusting one regression.
Where candidates lose it
Using the coupon on existing debt as the cost of debt, or using book equity in the weights. Both are common and both are wrong. WACC is forward-looking and market-based.
Expect next
- Why do you unlever and relever beta?
- Can debt ever be more expensive than equity?
- What happens to WACC as you add leverage?
Reported by candidates at Citi (Generalist, New York, 2026). Source: Wall Street Oasis.
042What is the difference between management rollover and management incentives?CitiMergers and Acquisitions · New York · 2026
Say this
Rollover is management reinvesting its existing equity into the new deal instead of cashing out. Incentives are new equity granted to management going forward, usually options or a management incentive plan that vests on performance.
Then walk it
- Rollover is backward-looking value. Management already owns shares; instead of taking the cash, they roll some percentage into the new capital structure alongside the sponsor.
- It reduces the sponsor's cheque size, which is helpful, and it signals confidence, which buyers care about. It can also be tax-deferred, so management has a reason to want it.
- Incentives are forward-looking and dilutive to the sponsor. A typical management incentive plan is five to fifteen percent of equity, vesting on time and on a return hurdle.
- In a model they sit in different places. Rollover is a source of funds in the sources and uses table. The incentive pool is dilution to the sponsor's exit proceeds, so it reduces the sponsor's IRR, not the entry price.
- The reason both exist: rollover aligns management on the downside because their own money is at risk, and the incentive plan aligns them on the upside. A sponsor wants both.
Where candidates lose it
Conflating the two, or putting the incentive pool in sources and uses. Rollover funds the deal; incentives dilute the exit. Getting that placement right is what the question is actually testing.
Expect next
- How does the incentive pool affect the sponsor's IRR?
- How much rollover would you expect management to do?
- Where does rollover sit in the sources and uses?
Reported by candidates at Citi (Mergers and Acquisitions, New York, 2026). Source: Wall Street Oasis.
071What is happening in the US economy right now?J.P. MorganPrivate Banking · Charlotte · 2026Truist SecuritiesRisk Management · Charlotte · 2026CitiGeneralist · London · 2026
Say this
Answer with a structure rather than a list of headlines: growth, inflation, the labour market, then what the central bank is doing about it, then what that means for your desk. Four numbers and one implication.
Then walk it
- Know four figures cold on the morning of your interview: GDP growth, headline and core inflation, the unemployment rate, and the policy rate. Say them with the vintage, as in 'core PCE ran at X in the latest print'.
- Then the tension. There is almost always one: inflation sticky while the labour market softens, or growth resilient while rates stay restrictive. Naming the tension is what makes it analysis instead of recitation.
- Then the policy read: what the market is pricing for the next two or three meetings, and what would change it.
- Then bring it back to the seat. Something like: for M&A, a lower path for rates lowers the sponsor's cost of debt, which supports higher entry multiples and should reopen the large-cap LBO pipeline.
- Keep it to ninety seconds. This question tests preparation and judgement about relevance, not breadth.
Where candidates lose it
Reciting headlines with no numbers, or numbers with no implication for banking. Also, opinions about politics. Stay on the transmission mechanism from macro to your desk, and check your figures the morning of the interview because a stale print is worse than none.
Expect next
- How is that affecting the M&A market?
- Describe Jerome Powell's tenure.
- Where did the S&P 500 close last night?
Reported by candidates at J.P. Morgan (Private Banking, Charlotte, 2026); Truist Securities (Risk Management, Charlotte, 2026); Citi (Generalist, London, 2026). Source: Wall Street Oasis.
079How would you value your school's most popular food truck, and what assumptions would you make?CitiInvestment Banking · New York · 2026
Say this
Build up the revenue from observable inputs, estimate margin, then apply a multiple appropriate to a tiny owner-operated business. Say every assumption out loud and keep the numbers round.
Then walk it
- Revenue: it serves maybe 150 customers a day at an average ticket of $12, so about $1,800 a day. Open 300 days a year, so roughly $540,000 of annual revenue.
- Costs: food cost around 30 percent, one or two staff plus the owner at maybe $80,000 total, then permits, fuel, maintenance and the truck payment. Call it $120,000 of operating profit before the owner's own wage.
- Normalise for owner compensation, which is the step people skip. If the owner is working full time, you must charge a market salary, say $50,000, leaving about $70,000 of real EBITDA.
- Multiple: this is a tiny business with total key-person dependency, no contracts, and a licence that may not transfer. Two to three times EBITDA, so $140,000 to $210,000.
- Then the cross-checks: the replacement cost of a used truck and equipment is maybe $60,000 to $100,000, which sets a floor. And the location permit may be the single most valuable asset, in which case you are really valuing the licence, not the business.
Where candidates lose it
Applying a public-market multiple to a food truck. Small, owner-dependent businesses trade at two to four times EBITDA, not ten. And forgetting to charge for the owner's labour, which overstates EBITDA enormously in any small business case.
Expect next
- What if the permit is not transferable?
- How would you value an apple tree?
- What would make you pay more than replacement cost?
Reported by candidates at Citi (Investment Banking, New York, 2026). Source: Wall Street Oasis.
096Why investment banking, and why this firm?Goldman SachsInvestment Banking · New York · 2026CitiInvestment Banking · San Francisco · 2025Truist SecuritiesInvestment Banking · Charlotte · 2026Deutsche BankInvestment Banking · London · 2022Rothschild & CoInvestment Banking · London · 2025
Say this
Three beats: a specific moment that got you interested, what you did to test that interest, and one concrete reason for this firm that could not be copy-pasted to a competitor.
Then walk it
- The origin has to be specific and true. A deal you followed, a project where you built a model, a company in your family, a case competition. Not 'I have always been passionate about finance'.
- Then the evidence that you tested it, because interest is cheap and action is not. A society, a self-taught model, an internship, a stock you have tracked for two years.
- Then why banking rather than the adjacent options, and be honest about the trade you are making. Something like: I want the transaction seat rather than the research seat because I want to be inside the execution, and I know what the hours cost.
- Then why this firm, with one fact that is true only of them: a specific deal, a sector franchise, the size of the analyst class, the staffing model. One real fact beats three generic compliments.
- Keep it to about ninety seconds and finish cleanly instead of trailing off. Then stop talking.
Where candidates lose it
A 'why this firm' answer that would work for any of their competitors. Interviewers hear forty versions a day and the generic ones blur. Name one thing only they do, and if you have spoken to someone there, say who and what they told you.
Expect next
- Why you over the other candidates from your university with the same experience?
- What do you think analysts actually do day to day?
- Which group do you want and why?
Reported by candidates at Goldman Sachs (Investment Banking, New York, 2026); Citi (Investment Banking, San Francisco, 2025); Truist Securities (Investment Banking, Charlotte, 2026); Deutsche Bank (Investment Banking, London, 2022); Rothschild & Co (Investment Banking, London, 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.