Monday, May 20, 2013

2013 Investment Banking Interview Questions

Want an investment banking job?  Answer these questions first.

Working at an investment bank may not be as prestigious and high-paying as it was years ago, but competition remains fierce, for internship and full-time roles alike. Investment banks are famous for asking some of the most difficult or even weird interview questions you’ve ever heard.

Here’s some of the more interesting questions recently asked of M.B.A. graduates and prospective interns from New York University’s Leonard N. Stern School of Business.

Some questions may be simple and without a definite right/wrong answer.  If you had to answer these questions at an interview, be sure to demonstrate your logic of thinking and ability of analyzing.  Test your skills and post your answers in the comment section.

Don’t assume all questions are banking related.   

  1. How do you think you’ll handle the hours? Tell me about a time you’ve worked overtime?
  2. What does F9 do in Excel?
  3. On a football field, how are the different valuation ranges going to show up?
  4. If I were to ask your parents what they thought about you going into banking, what would they say?
  5. In a regular market, what is more expensive debt or equity? Explain your thought process.
  6. If the yield for a one-year bond is 10% and the yield for a two-year bond is 15%, what is the forward rate for the second year?
  7. How do changes in interest rates impact duration?
  8. Does company-specific risk impact Beta? Why or why not?
  9. In a declining interest rate environment would you rather hold interest-only or principal-only?
  10. Why is free cash flow called “free” cash flow? What does “free” signify? 

Need help to answer IB interview questions, check out the IIB website.  You can even sign up to gain instant access to A-grade sample banking resumes, mock interview transcripts and more.