IB Interview Guide.
Technical questions, behavioral prep, and how to walk through the valuation concepts every IB interviewer will ask.
IB technical interviews are specific and tested cold. You need to be able to walk through a DCF, explain the three financial statements and how they connect, and describe an LBO from memory — without notes, without hesitation. Prepare with purpose.
How IB Interviews Are Structured
First Round
Typically 30–45 minutes. Mix of technical questions (accounting, valuation, M&A concepts) and behavioral questions. Often conducted by analysts or associates. Technical rigor is high — they are testing whether you've actually prepared.
Superday / Final Round
Multiple back-to-back interviews in a single day with analysts, associates, VPs, and sometimes MDs. Each interviewer evaluates a different dimension. The technical bar stays consistent throughout. You need to perform at the same level in every session.
Group-Specific Interviews
If you've expressed interest in a specific coverage group (TMT, Healthcare, FIG, LATAM), interviewers will ask about deals and trends in that space. Know 2–3 recent transactions in your target vertical.
Technical Questions — The Core Topics
These are the questions asked in nearly every IB interview. Know each one cold before your first round.
Accounting & Financial Statements
Interview question
“Walk me through the three financial statements.”
Income statement (revenues → net income), balance sheet (assets = liabilities + equity), cash flow statement (operating, investing, financing). The key is how they connect: net income flows from the income statement to retained earnings on the balance sheet and to operating cash flow on the cash flow statement.
Interview question
“If depreciation increases by $10, what happens to the financial statements?”
Income statement: EBIT decreases by $10, taxes decrease by $4 (at 40% tax rate), net income decreases by $6. Balance sheet: PP&E decreases by $10, retained earnings decreases by $6. Cash flow: depreciation is added back in operating activities, so cash is unchanged. Net effect: net income down $6, cash unchanged.
Valuation
Interview question
“Walk me through a DCF.”
Project free cash flows for 5–10 years, calculate a terminal value (using Gordon Growth Model or exit multiple), discount all cash flows back to present using WACC. Sum gives enterprise value. Subtract net debt to get equity value. Divide by shares outstanding to get share price.
Interview question
“What are the three main valuation methodologies and when do you use each?”
DCF: intrinsic value based on future cash flows — most rigorous but most assumption-dependent. Comparable company analysis (comps): market-based — uses trading multiples of similar public companies. Precedent transactions: M&A-based — uses multiples from historical deals in the same sector, typically higher than comps due to control premium.
Interview question
“What is WACC and why do we use it?”
Weighted Average Cost of Capital — the blended required return of a company's debt and equity holders. Used as the discount rate in a DCF because it represents the opportunity cost of capital for that company.
M&A Concepts
Interview question
“Walk me through an LBO.”
A private equity firm acquires a company using significant debt (60–80% of the purchase price). The acquired company's cash flows service the debt over 4–7 years. At exit (IPO or sale), returns come from: debt paydown (equity grows), EBITDA growth, and multiple expansion. IRR is the key metric.
Interview question
“Is an acquisition accretive or dilutive?”
Accretive if the deal increases the acquirer's EPS; dilutive if it decreases EPS. An acquisition is accretive if the target's earnings yield (earnings / purchase price) exceeds the acquirer's P/E ratio. For stock deals: accretive if the target's P/E < acquirer's P/E.
Interview question
“What is a control premium and why does it exist?”
The premium an acquirer pays above a company's public market price to gain control. Typically 20–40%. It exists because controlling shareholders can make strategic decisions, redirect cash flows, and realize synergies that minority shareholders cannot.
Markets & Current Events
Interview question
“Where is the 10-year Treasury yield today and what does it mean for deals?”
Know the current level before every interview. Higher yields increase WACC, reducing DCF values and making deals more expensive to finance. Rising rates generally compress valuations and slow M&A activity.
Interview question
“What is a recent deal you found interesting and why?”
Pick a real deal — a merger, an IPO, a buyout — from the past 6 months. Know the rationale, the deal structure, the price, and your view on whether it was a good deal. This is not a trick question — they want to see that you actually read about M&A.
Read the Wall Street Journal and Financial Times deal sections daily for 2 months before recruiting. You should be able to speak to 3–4 recent M&A transactions across your target vertical without hesitation. Interviewers notice when candidates are actually following markets.
How to Prepare
Breaking Into Wall Street (BIWS) or Wall Street Prep
The two industry-standard financial modeling courses. Both cover accounting, DCF, LBO, and comps. Pick one and complete it fully before recruiting season.
Investment Banking by Rosenbaum & Pearl
The definitive IB technical reference book. Read the valuation chapters — DCF, comps, precedent transactions — and keep it as a reference throughout prep.
Mergers & Inquisitions / Wall Street Oasis
Free guides, interview prep articles, and forums where people share real IB interview questions. Use these to supplement your core prep and to understand what firms are currently asking.
Build a real financial model
Pick a public company, pull their 10-K, and build a three-statement model and DCF from scratch. Show it in interviews. Saying 'I built a model for [Company]' is more credible than 'I studied valuation.'
Mock interview with someone who has done IB recruiting
Find an upperclassman, an alumni, or a peer who has been through IB recruiting. Do full mock technicals under time pressure. The difference between knowing concepts and answering them fluently under pressure is significant.
Behavioral Questions
IB behavioral interviews are as important as technical. Prepare each answer until it sounds natural — not memorized.
Interview question
“Why investment banking?”
Be specific and honest. Name a financial concept, a deal, or an experience that sparked your interest. 'I want a broad foundation' is not an answer — every banker knows it.
Interview question
“Why this bank specifically?”
Each bank has a culture and a reputation. Goldman is known for advisory excellence and prestige. JPMorgan is known for breadth and global reach. Morgan Stanley is known for technology IB and equities. Pick something real and firm-specific.
Interview question
“Why this coverage group?”
You must have an answer. 'I'm open to any group' signals unpreparedness. Name a group, explain your interest in the industry, and name a deal that reflects why it matters to you.
Interview question
“Tell me about a time you worked on a team under pressure.”
Use STAR format. Focus on what you specifically contributed, how you handled the pressure, and what the outcome was. IB hours are brutal — show you can function in a high-stakes environment.
Interview question
“Walk me through your resume.”
Chronological or reverse-chronological — your choice. Be prepared to explain every line. The most important question is always a follow-up: 'Tell me more about what you actually did there.'
Interview question
“What is your biggest weakness?”
Name a real one. Say what you've actively done to improve. The answer that says 'I work too hard' ends the conversation.
The biggest mistake in IB interviews is being generic. Generic "why IB" answers, generic deal commentary, generic weakness answers. Everything specific to you — your actual interest in a particular vertical, a real deal you followed, a model you built — is what makes you memorable. Be specific.