Investment Banking Interview Questions

Accounting questions test whether you can move fluently between the income statement, balance sheet, and cash flow statement under pressure. Interviewers ask these to screen for the basics, every analyst needs to walk through the three-statement linkage cleanly, explain how working capital changes hit cash, and reason through journal entries for things like deferred revenue and capex.

Valuation questions cover the core methods bankers use to value a company: trading comparables, transaction comparables, discounted cash flow, and precedent transactions. Interviewers want to hear that you understand when each method is appropriate, what the typical premium ranges are, and why public-company valuations differ from M&A transaction valuations.

DCF questions test the mechanics of a discounted cash flow model, projecting unlevered free cash flow, discounting it back at the weighted average cost of capital, calculating terminal value, and bridging from enterprise value to equity value. These are some of the most commonly asked technical questions in IB interviews.

LBO questions evaluate whether you understand how a financial sponsor uses debt to amplify returns on an acquisition. Expect questions on the sources and uses table, debt schedules, IRR and MOIC drivers, and how operational improvements compare to multiple expansion as return drivers. LBO modeling questions also test your ability to think through capital structure and credit metrics.

M&A questions cover the mechanics and strategy of mergers and acquisitions, accretion/dilution analysis, synergies, deal structures (stock vs. cash vs. mixed), purchase accounting, and goodwill creation. Interviewers want to see you can quickly assess whether a deal makes financial sense for the acquirer and articulate the strategic rationale.

Behavioral questions test fit, motivation, and self-awareness. Interviewers want to understand why you want to do investment banking specifically (not just finance), how you handle pressure and long hours, your leadership and teamwork experience, and whether you've thought carefully about your career trajectory. Strong behavioral answers use the STAR structure and tie back to concrete examples.