Acing the Investment Banking Interview: Commonly Asked Questions and How to Nail Your Responses
Landing the investment banking job offer requires impressing interviewers with thoughtful responses showcasing your motivation, diligent preparation and technical abilities. Expect questions assessing your deal exposure, financial modelling expertise, and client interactions.
Background and Motivations
Hiring managers will evaluate what drives your interest and relevant experiences:
Why investment banking?
Discuss your intellectual curiosity about complex strategic finance deals and your desire to help clients solve problems. Reference courses, academic projects or market trends that sparked your passion for transactions. I knew I wanted to advise firms on strategic capital decisions when I built an M&A model for an independent study course.
Why this bank and group?
Show you understand the bank’s industry specialities, products, culture and recent deals. Have a view on trends impacting their subsector. Articulate why your skills align well. I have focused my recent deal experience on TMT transactions which directly supports your Software and Internet group’s advisory focus.
Where do you see your long-term career progressing?
Demonstrate plans to develop as a world-class advisor but commitment to the bank. I aspire to cover industry leaders long-term but expect to build expertise as an associate focused on your FMCG franchise first.
Technical Questions
Hone modelling skills and transaction knowledge to prove expertise:
Walk me through an LBO or discounted cash flow model.
Use a deal example to illustrate key inputs and value drivers. Outline how you assessed the reasonability of assumptions on growth, margins, capex etc. Assess NPV, IRR and payback period outputs. In my metals & mining LBO model, the cost of capital was a pivotal assumption given commodity cycle exposure.
Discuss a recent deal and valuation metrics.
Reference multiples paid, premiums and strategic rationale. Comment on relative value vs. past deals. For the Zendesk/Momentive deal, the 15x EV/Revenue reflected strong SaaS model alignment despite near-term dilution from stock consideration.
Fit and Behavioral
Show you can manage the pressure and evolve your leadership style:
How do you handle stressful situations?
Discuss compartmentalizing tasks, having disciplined work processes and leaning on mentorships. Recognize that setbacks occur but strong teams collaborate through challenges. Once on a live deal, I managed scheduling conflicts by spearheading collaborative planning calls between the key department leads early in the transaction.
If you were in charge, what changes would you make in your group?
Demonstrate humility and that you will take time to learn current processes first. Offer 1-2 thoughtful ideas, like streamlining templated models or inviting senior female executives as mentors. As I gain more insights about the group, small efficiencies like standardized file shares could reduce administrative friction.
In summary, show your strategic thinking and that clients’ long-term interests anchor your motivation. Keep responses concise, structured and impact-oriented.
“We found the candidate’s ability to communicate complex analysis under pressure and motivation to keep developing stood out amongst her peers,” noted the Head of Americas Investment Banking.