Investment Banking interview preparation

Questions

100

Traced to a firm

100

Firms

46

Updated

September 2026

Asked at

All firmsTSTruist Securities10Rothschild & Co8Centerview Partners7CSCredit Suisse7HWHarris Williams6Houlihan Lokey6Lazard6Mizuho6Barclays5Citi5Deutsche Bank5Evercore5Moelis & Company5MSMorgan Stanley5Piper Sandler5RCRBC Capital Markets5Goldman Sachs4Nomura4TD Securities4Bank of America3GSGuggenheim Securities3J.P. Morgan3Jefferies3Moody's3Perella Weinberg Partners3WPWarburg Pincus3WBWilliam Blair3HSBC2Lincoln International2Scotiabank2TPTPG2UBS2Wells Fargo Securities2Advent International1Apollo Global Management1Bain Capital1Balyasny Asset Management1BLBlackRock1BPBNP Paribas1General Atlantic1Invesco1Morningstar1PIMCO1STSociété Générale1SSState Street1WMWellington Management1

Topic

All topicsAccounting14Valuation21M&A10Markets and deals10Capital markets3LBO8Leveraged finance3Restructuring2Credit3Debt capital markets2Capital structure2Case and estimation11Brainteasers6Fit5

Level

AnyCoreIntermediateHard

Type

AnyTechnicalCaseBrainteaserFitMarket view

1. 002Tell me how $10 of depreciation flows through the three statements.AccountingCoretechnicalCSCredit SuisseData Modeling · Chicago · 2023BarclaysInvestment Banking · New York · 2025MizuhoInvestment Banking · New York · 2026Houlihan LokeyDebt Capital Markets · Los Angeles · 2025

   Say this

   Assume a 25% tax rate. Pre-tax income falls by $10, taxes fall by $2.50, so net income falls by $7.50. Cash actually goes up by $2.50, because depreciation is non-cash and the only real effect is the tax saving.

   Then walk it

   1. Income statement: $10 of depreciation hits EBIT, so pre-tax income is down $10 and net income is down $7.50 at a 25% rate.
   2. Cash flow statement: start from net income at minus $7.50, add back the $10 non-cash depreciation, so cash from operations is up $2.50.
   3. Balance sheet: cash is up $2.50, net PP&E is down $10, so assets are down $7.50 net. Retained earnings are down $7.50. It balances.
   4. The whole point is the depreciation tax shield. Ten dollars of a non-cash charge bought you two-fifty of real cash.

   Where candidates lose it

   Saying cash goes down. It does not. Depreciation is non-cash, so the only cash effect is the tax you no longer pay. State your tax rate before you start so the interviewer can follow your arithmetic, and say the words 'tax shield'.

   Expect next

   • Now do the same for $10 of CapEx instead.
   • What if the company had no taxable income that year?
   • How does this change if the depreciation is not tax-deductible in that jurisdiction?

   Reported by candidates at Credit Suisse (Data Modeling, Chicago, 2023); Barclays (Investment Banking, New York, 2025); Mizuho (Investment Banking, New York, 2026); Houlihan Lokey (Debt Capital Markets, Los Angeles, 2025). Source: Wall Street Oasis.

2. 015Walk me through a DCF.ValuationCoretechnicalGoldman SachsInvestment Banking · New York · 2026Deutsche BankInvestment Banking · Honolulu · 2025BarclaysInvestment Banking · New York · 2025TSTruist SecuritiesCorporate Banking · Atlanta · 2025Houlihan LokeyDebt Capital Markets · Los Angeles · 2025CSCredit SuisseInvestment Banking · São Paulo · 2021

   Say this

   Project unlevered free cash flow for five to ten years, discount it at WACC, add a terminal value for everything beyond the forecast, sum to enterprise value, then bridge to equity value and divide by diluted shares.

   Then walk it

   1. Build unlevered free cash flow: EBIT, taxed, plus D&A, less CapEx, less the change in working capital.
   2. Discount at WACC, because unlevered cash flow belongs to both debt and equity holders. Use mid-year convention if cash arrives through the year.
   3. Terminal value two ways: Gordon growth on the final year cash flow, or an exit multiple on terminal EBITDA. I would run both and check they agree.
   4. Sum the discounted cash flows and the discounted terminal value to get enterprise value.
   5. Bridge down: less net debt, less preferred, less minority interest, plus non-operating assets, to get equity value. Divide by diluted shares for value per share.
   6. Then say the honest part: terminal value is usually 60 to 80 percent of the total, so the answer is mostly a function of the growth rate and discount rate, and I would sensitise both.

   Where candidates lose it

   Delivering it as a memorised list with no acknowledgement that terminal value dominates. Every candidate can recite the steps. The one who volunteers that most of the value sits in an assumption, and offers to sensitise it, sounds like someone who has actually built one.

   Expect next

   • What are the main drivers or sensitivities in your DCF?
   • What discount rate would you use and why?
   • When is a DCF the wrong tool?

   Reported by candidates at Goldman Sachs (Investment Banking, New York, 2026); Deutsche Bank (Investment Banking, Honolulu, 2025); Barclays (Investment Banking, New York, 2025); Truist Securities (Corporate Banking, Atlanta, 2025); Houlihan Lokey (Debt Capital Markets, Los Angeles, 2025); Credit Suisse (Investment Banking, São Paulo, 2021). Source: Wall Street Oasis.

3. 041Who is typically willing to pay more for an acquisition, a financial sponsor or a strategic buyer?M&AIntermediatetechnicalHoulihan LokeyMergers and Acquisitions · Los Angeles · 2026

   Say this

   A strategic, normally, because it can capture synergies and does not need a fixed return on equity. A sponsor is constrained by its return hurdle and the debt markets, so it is valuing standalone cash flows only.

   Then walk it

   1. The strategic gets cost synergies, revenue synergies and sometimes a strategic premium for defending a market position. All of that expands the price it can justify.
   2. It also has a lower cost of capital and no fund life, so it can accept a longer payback.
   3. The sponsor has to hit roughly a 20 to 25 percent IRR in five years with debt it can actually raise. That caps the entry multiple mechanically.
   4. Where sponsors win anyway: a platform sponsor with an existing portfolio company in the sector effectively has synergies too, through a bolt-on. In that case the gap closes or reverses.
   5. And in a cheap credit market with high multiples, sponsors have repeatedly outbid strategics, because the leverage available made the maths work. So the rule holds on average and breaks often.

   Where candidates lose it

   Stating the rule with no mechanism and no exception. The interviewer wants the return-hurdle constraint named explicitly, and the bolt-on case is the answer that shows you follow live deals.

   Expect next

   • When does the sponsor win?
   • What return does a sponsor actually need?
   • How does the credit market change your answer?

   Reported by candidates at Houlihan Lokey (Mergers and Acquisitions, Los Angeles, 2026). Source: Wall Street Oasis.

4. 063Given this capital structure, what is the recovery on each claim?RestructuringHardsuperdayHoulihan LokeyRestructuring · New York · 2026

   Say this

   Value the enterprise first, then pay it out down the waterfall in strict seniority until it runs out. Whichever tranche the value runs out in is the fulcrum security, and that is where the equity ends up after the restructuring.

   Then walk it

   1. Establish enterprise value. In distress I would use a distressed multiple on normalised EBITDA and cross-check against a liquidation value, because the two set a range.
   2. Then the waterfall: super-priority and DIP financing first, then secured claims in order of lien priority, then unsecured bonds, then subordinated debt, then preferred, then common.
   3. Work down until the value is exhausted. Say enterprise value is $600, the revolver and term loan total $400 and recover in full, and the unsecured bonds are $400. They receive the remaining $200, so a 50 percent recovery.
   4. Those bonds are the fulcrum. They are the class that gets converted into the new equity, which is why distressed funds buy the fulcrum, not the safest paper.
   5. Everything below the fulcrum, subordinated debt and common equity, recovers nothing in a strict waterfall. In practice they often receive a small stub or warrants to buy consent and avoid a contested plan, which is a negotiation outcome rather than an entitlement.

   Where candidates lose it

   Jumping to the waterfall before establishing enterprise value. You cannot allocate what you have not measured. And missing the fulcrum concept entirely, which is the single most important idea in the discipline.

   Expect next

   • Which security would you buy?
   • What is the absolute priority rule and when is it violated?
   • What section of the indenture deals with payment waterfalls?

   Reported by candidates at Houlihan Lokey (Restructuring, New York, 2026). Source: Wall Street Oasis.

5. 085Given a B2B SaaS company with this EBITDA and this P/E, what would you do to improve its operations and financials?Case and estimationHardsuperdayHoulihan LokeyInvestment Banking · New York · 2026

   Say this

   Work the SaaS levers in order of value: pricing, then retention, then sales efficiency, then cost. In software, a point of net revenue retention is worth more than a point of cost saving, because it compounds.

   Then walk it

   1. Pricing first. Most B2B software is underpriced relative to the value it delivers. Move to value-based or usage-based pricing, introduce tiers, and raise prices on renewal for the existing base. This is near-pure margin.
   2. Retention second. Net revenue retention above 110 percent means the installed base grows without new sales. Reduce churn in the weakest cohort and upsell modules into the strongest. This changes the growth rate and therefore the multiple.
   3. Sales efficiency third. Look at customer acquisition cost payback and the magic number. If payback is over 24 months, the problem is targeting or pricing, not effort. Reallocate spend to the segments with the fastest payback.
   4. Cost fourth, and deliberately last. Consolidate the cloud bill, rationalise the product portfolio, offshore support engineering. Real money, but it does not change the growth story.
   5. Then the bolt-on question: in a fragmented software vertical, acquiring adjacent modules at a lower multiple and cross-selling them into your base is usually the single largest value-creation lever available.
   6. One flag on the question itself: P/E is an odd metric for a software company, since GAAP earnings are suppressed by growth spend and stock compensation. I would work off EV/ARR and EV/EBITDA instead, and I would say so.

   Where candidates lose it

   Jumping to cost cutting. In software, growth and retention drive the multiple, and the multiple drives the value far more than a margin point does. Also worth noticing that P/E is the wrong lens here; naming that is a real signal.

   Expect next

   • What is the formula for net revenue retention, gross retention and churn?
   • Which of those levers moves the multiple?
   • How would you verify the pipeline to forecast revenue?

   Reported by candidates at Houlihan Lokey (Investment Banking, New York, 2026). Source: Wall Street Oasis.

6. 100Why should we take you over the other candidates from your university with exactly the same experience?FitHardsuperdayRothschild & CoInvestment Banking · Milan · 2025Houlihan LokeyInvestment Banking · New York · 2026MorningstarGeneralist · Chicago · 2024

   Say this

   Do not claim to be smarter or more driven, because everyone in the room says that. Name one specific, verifiable thing you have that they probably do not, and connect it to the work.

   Then walk it

   1. The honest framing first: on paper we are similar, and I would not pretend otherwise. So the answer has to be something specific rather than an adjective.
   2. Then the differentiator, and it should be concrete. Depth in one sector nobody else in the class has looked at. A language and a market. A technical skill like Python or SQL you have actually used on a dataset. Having run something with real accountability and real money.
   3. Then tie it to their business, not to your CV. Something like: your industrials team does a lot of cross-border work in Italy, and I can read Italian filings and speak to a management team without an interpreter. That is useful on day one.
   4. Then the evidence, in one line, because the claim is worthless unless it is checkable.
   5. And avoid the two failure modes: listing adjectives, which is unfalsifiable and forgettable, or disparaging other candidates, which reads badly in a business where you will spend your life in a small team.

   Where candidates lose it

   Answering with 'work ethic' and 'passion'. Every candidate says both and neither can be verified. Pick a specific, checkable capability and connect it to something their desk actually does. Specificity is the entire answer.

   Expect next

   • What is something about you that is not on your CV?
   • Why this group, and what do you add that someone else cannot?
   • What is one thing you wish had gone differently today?

   Reported by candidates at Rothschild & Co (Investment Banking, Milan, 2025); Houlihan Lokey (Investment Banking, New York, 2026); Morningstar (Generalist, Chicago, 2024). 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.