What Are the Most Common Investment Banking Interview Questions and How to Prepare for Them?

Securing a role in investment banking requires mastering a notoriously rigorous interview process. Success hinges on anticipating a blend of behavioral, experiential, and deeply technical questions designed to assess your fit, resilience, and financial acumen. Based on our assessment experience, thorough preparation involving practiced responses to common queries significantly increases your chances.

What are common general investment banking interview questions?

Hiring managers use these initial questions to gauge your motivation, character, and cultural alignment with the bank. Your answers should be tailored to the firm's specific values and the role's requirements. Common questions include:

• What interested you about this role and our bank?
• Why do you believe you are a good fit here?
• What are your strengths and weaknesses?
• Where do you see yourself in five years?
• What are your hobbies outside of work?

The key is to move beyond generic answers. For "Why our bank?" reference a recent deal or the firm's reputation in a specific sector. When discussing strengths, link them directly to the job description, and for weaknesses, show self-awareness by explaining how you're working to improve.

How do interviewers probe your experience and background?

This segment shifts focus to your professional track record. Interviewers use behavioral questions—which ask you to describe past situations—to predict future performance. Be prepared with concise stories using the STAR method (Situation, Task, Action, Result) to structure your responses. Expect questions like:

• Can you describe a time you overcame a significant challenge on a deal?
• Tell me about a situation where you had to work under extreme pressure.
• What is your biggest professional achievement to date?

Pro Tip: Align your stories with the competencies listed in the job description, such as teamwork, leadership, or analytical skills. Quantify your results where possible (e.g., "My analysis identified a 15% cost-saving opportunity.").

What technical questions should you expect in an investment banking interview?

This is where your financial modeling and valuation expertise is tested. You must demonstrate a solid grasp of core concepts. Below is a summary of common technical areas:

For example, when asked, "What is beta?" you might explain: "In investment banking, beta is a measure of a stock's volatility in relation to the overall market. A beta greater than 1 indicates the stock is more volatile than the market." Providing clear, textbook definitions shows foundational knowledge.

How can you formulate strong answers to technical questions?

Simply memorizing answers is insufficient. Interviewers seek understanding and the ability to apply concepts. Consider this sample breakdown for a common technical question:

Question: How would you value a company with negative cash flows?

• Core Answer: "Most valuation methods rely on positive, predictable cash flows. In this case, a Discounted Cash Flow (DCF) analysis becomes challenging. The most appropriate method would be a relative valuation using precedent transactions or comparable company analysis, focusing on revenue multiples if the company is a growth-stage startup."
• Why it Works: This response acknowledges the complexity, rules out inappropriate methods, and provides a justified alternative, demonstrating critical thinking.

Key preparation strategies include:

• Practice Aloud: Rehearse your answers to ensure they are fluent and confident.
• Use Real Examples: Whenever possible, incorporate lessons from internships or case studies.
• Clarify if Needed: It's acceptable to ask for clarification on a complex question to ensure you understand what is being asked.

To maximize your preparedness, focus on these actionable steps: practice behavioral stories using the STAR method, create flashcards for technical definitions, and meticulously research the specific bank you are interviewing with. This comprehensive approach demonstrates the diligence and expertise required for a successful career in investment banking.