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. 062What makes a company distressed, and why restructuring?RestructuringIntermediatetechnicalEvercoreRestructuring · New York · 2025Rothschild & CoRestructuring · London · 2025

   Say this

   Distress is when a company cannot service its obligations from its cash flow, or cannot refinance a maturity. Distinguish operational distress, where the business is broken, from financial distress, where a good business carries the wrong capital structure.

   Then walk it

   1. The observable triggers: interest coverage falling toward one, a covenant breach, a maturity wall it cannot refinance, bonds trading at a deep discount to par, and a credit downgrade.
   2. Financial distress means the operations work but the balance sheet does not. The fix is a balance sheet fix: amend and extend, a debt-for-equity swap, a rights issue, a liability management exercise.
   3. Operational distress means the business itself is impaired, by a lost contract, structural decline or a broken cost base. No amount of refinancing solves that; you need an operational turnaround or a sale.
   4. The distinction drives everything about the advice, so I would establish it first in any situation.
   5. On why restructuring specifically: the work is analytically harder than M&A because you are valuing the enterprise and then allocating it across a capital structure, and the negotiation is multi-party and adversarial. It is also counter-cyclical, which is a genuine reason to want to be in it.

   Where candidates lose it

   Not separating operational from financial distress. That single distinction is the core intellectual content of restructuring, and a restructuring interviewer will hear immediately whether you have it. Also, do not answer 'why restructuring' with 'because it is counter-cyclical' alone; that reads as cynical.

   Expect next

   • What is the recovery on each claim?
   • Do you understand what we actually do here?
   • What were the recent developments in the debt space?

   Reported by candidates at Evercore (Restructuring, New York, 2025); Rothschild & Co (Restructuring, London, 2025). Source: Wall Street Oasis.

2. 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.

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.