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
025What is EV/EBITDA and when would you use it?William BlairInvestment Banking · Chicago · 2026
Say this
It values the whole enterprise against operating cash earnings before capital structure and accounting choices. You use it when you want to compare companies with different leverage, different tax positions or different depreciation policies.
Then walk it
- Enterprise value is capital-structure neutral, and EBITDA is pre-interest, so numerator and denominator match. Both belong to all capital providers.
- It strips out D&A, so it lets you compare an asset-heavy company with an asset-light one on operating performance.
- It is the default in M&A and leveraged finance, because a buyer is buying the enterprise and will put its own capital structure on it.
- Where it fails: it ignores capital intensity entirely. Two companies with the same EBITDA but very different CapEx are not worth the same, and EV/EBITDA cannot see that.
- So for capital-heavy businesses I would look at EV/EBIT or EV/EBITDA less CapEx alongside it. And for banks it is meaningless, because interest is revenue.
Where candidates lose it
Not being able to say when it breaks. Everyone knows the formula. The candidate who volunteers 'it is blind to CapEx, so I would pair it with EV/EBIT for a capital-intensive business' has answered the real question.
Expect next
- What happens to EV/EBITDA when EBITDA increases?
- How does EV/EBITDA vary across industries?
- Why would you never use it for a bank?
Reported by candidates at William Blair (Investment Banking, Chicago, 2026). Source: Wall Street Oasis.
032How do you get from enterprise value to equity value without using an equation?PIMCOFinancial Institutions Group · New York · 2023Truist SecuritiesCorporate Banking · Atlanta · 2025William BlairMergers and Acquisitions · London · 2026
Say this
Enterprise value is the price of the operating business itself. To get to what shareholders own, you pay off everyone with a prior claim, then add back anything the business owns that is not part of operations.
Then walk it
- Start with the value of the operating business, which is what enterprise value measures.
- Settle the lenders first, because they stand ahead of shareholders. Subtract debt.
- Add back cash, because cash is not part of the operating business and a buyer effectively gets it for free.
- Subtract the other prior claims: preferred stock, minority interest in consolidated subsidiaries, and funded pension shortfalls, since a buyer inherits those obligations.
- Add non-operating assets like stakes in unconsolidated affiliates or surplus real estate, because the operating cash flow never captured them.
- What is left is what the equity is worth. Divide by diluted shares and you have value per share.
Where candidates lose it
Reciting 'EV minus net debt' when the interviewer explicitly asked for no equation. They want the story of who gets paid in what order. Talk in terms of claims and seniority, not symbols.
Expect next
- How do you treat underfunded pensions in that bridge?
- What is the equity ticker and how do you calculate it?
- Why do you add back cash?
Reported by candidates at PIMCO (Financial Institutions Group, New York, 2023); Truist Securities (Corporate Banking, Atlanta, 2025); William Blair (Mergers and Acquisitions, London, 2026). Source: Wall Street Oasis.
057What makes a good LBO candidate?Warburg PincusPrivate Equity · San Francisco · 2014Guggenheim SecuritiesHealthcare · London · 2026
Say this
Predictable, recurring cash flow that can service debt, low capital intensity, a defensible market position, an identifiable operational improvement, and a credible exit. Cash flow stability matters more than growth.
Then walk it
- Stable cash flow first, because the debt has to be serviced whatever happens. Contracted or subscription revenue, low cyclicality, sticky customers.
- Low CapEx, because every dollar into maintenance is a dollar not repaying debt.
- Strong market position and real barriers to entry, so margins survive the hold period without the company needing to outspend rivals.
- A visible value-creation lever: an underinvested sales function, a bloated cost base, a fragmented sector that supports a bolt-on strategy, or a non-core division to divest.
- And an exit that is not hypothetical. A deep strategic buyer list, or a peer set that trades publicly at a decent multiple. The best entry price in the world is worthless if nobody will buy it from you in five years.
- Conversely, the anti-candidate is a high-growth, cash-burning, cyclical business with heavy CapEx. It can be a great investment and a terrible LBO.
Where candidates lose it
Saying 'high growth' near the top of your list. Growth consumes cash and cash service is the constraint. Venture-style growth is the opposite of what an LBO needs, and saying so shows you understand why the structure exists.
Expect next
- Tell me about a company you like. Is it a good LBO candidate?
- Why is high growth not necessarily good here?
- What type of company is a good candidate for a dividend recap?
Reported by candidates at Warburg Pincus (Private Equity, San Francisco, 2014); Guggenheim Securities (Healthcare, London, 2026). Source: Wall Street Oasis.
073How does a bank make money?J.P. MorganPrivate Banking · Charlotte · 2026
Say this
Two engines: net interest income, which is the spread between what it pays depositors and earns on loans and securities, and fee income from advisory, underwriting, trading, asset management and payments.
Then walk it
- Net interest income is the classic bank business. Borrow short and cheap from depositors, lend long and dearer. The spread times the balance sheet is the revenue, and it is levered, which is why capital rules exist.
- Fee income is everything that does not consume much balance sheet: M&A advisory, ECM and DCM underwriting, trading commissions and spread capture, asset and wealth management fees, and transaction banking.
- The costs are compensation, which dominates, technology, regulatory and compliance, and credit losses through the provision line.
- The distinction that matters for an investment bank specifically: advisory revenue is capital-light and cyclical, while lending revenue is capital-heavy and steadier. That is why banks cross-sell, using the balance sheet to win the advisory mandate.
- So for a universal bank the shape is: net interest income for stability, fees for the upside, and the credit cycle as the thing that occasionally takes it all back.
Where candidates lose it
Answering only 'they lend money at a higher rate than they borrow'. For an investment banking interview you must name fee income and, ideally, the cross-sell point about using lending to win advisory work. That is the actual business model you are joining.
Expect next
- What are the biggest challenges banks face today?
- How would that change in a falling rate environment?
- Which revenue line would you want to be in and why?
Reported by candidates at J.P. Morgan (Private Banking, Charlotte, 2026). 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.