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. 005How can a company have negative EBITDA but positive free cash flow?AccountingIntermediatetechnicalWells Fargo SecuritiesInvestment Banking · Stanford · 2026

   Say this

   Working capital. If a company is collecting cash from customers faster than it pays suppliers, or taking cash upfront on subscriptions, that release of working capital can more than cover an operating loss.

   Then walk it

   1. The most common case is a business with big deferred revenue or customer prepayments. Cash arrives before the revenue is recognised, so EBITDA looks bad while the bank account fills up.
   2. A shrinking business can do it too. If you stop buying inventory and collect your receivables, you liquidate working capital into cash for a year or two.
   3. Low or zero CapEx helps, since free cash flow is after capital spending.
   4. Big non-cash charges below EBITDA do not explain it, because they are already excluded from EBITDA. It has to be balance sheet movement.
   5. The important caveat: none of this is sustainable. Working capital release is a one-time source, not an engine.

   Where candidates lose it

   Answering with 'add back depreciation'. Depreciation is already excluded from EBITDA, so that explains nothing. The answer has to live below EBITDA, which means working capital or CapEx.

   Expect next

   • Is that free cash flow sustainable?
   • Would you lend to this company?
   • What would you check on the balance sheet to test your theory?

   Reported by candidates at Wells Fargo Securities (Investment Banking, Stanford, 2026). Source: Wall Street Oasis.

2. 065What specific line items would you look at on the financial statements when evaluating creditworthiness?CreditIntermediatetechnicalRCRBC Capital MarketsCorporate Banking · New York · 2026Wells Fargo SecuritiesGeneralist · North Carolina · 2025

   Say this

   Cash flow from operations, because that is what repays debt. Then interest expense, total debt and its maturity schedule, cash, the undrawn revolver, CapEx, and the working capital lines.

   Then walk it

   1. Start with cash from operations across several years. One good year proves nothing; consistency through a downturn proves a lot.
   2. Interest expense against EBITDA gives coverage. Debt and the maturity schedule tell you when the pressure comes.
   3. Cash and the undrawn facility are the liquidity buffer. Compare them to the next 12 to 24 months of obligations.
   4. CapEx split into maintenance and growth. Maintenance CapEx is non-discretionary, so it competes with debt service. Growth CapEx can be cut in a bad year, which is a real source of flexibility.
   5. Then the working capital lines, receivables, inventory and payables, because deterioration shows up there before it reaches the income statement. Rising receivable days means customers are struggling or revenue is being pushed.
   6. And off the face of the statements: operating lease liabilities, pension deficits, guarantees and contingent liabilities in the notes. Those are real claims that do not sit in the debt line.

   Where candidates lose it

   Staying on the income statement. Credit is about cash and claims, so the answer lives on the cash flow statement and in the notes. Mentioning the notes, and specifically contingent liabilities, is what separates a credit answer from an equity answer.

   Expect next

   • How would you assess a good borrower qualitatively?
   • What would you ask the CFO if you were the lead analyst?
   • How do you determine whether a company is good for credit investing?

   Reported by candidates at RBC Capital Markets (Corporate Banking, New York, 2026); Wells Fargo Securities (Generalist, North Carolina, 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.