If you’re looking at a career in the field of investing and you’re up for the challenge of learning the ropes of corporate finance, investment banking might be for you. You can maximize your analytical skills and earn some of the highest pay found in any field (yes, even after the new pay rules).
In preparing for a job interview for an investment banking position, there are some things you should remember.
Make sure you know the firm’s specialties and what your potential role would be in the organization. Firms will judge your analytical skills not just based on your resume; they will also test how articulate you are under pressure and will likely ask for a real time demonstration of your modeling skills. They will also delve into your attitude towards risk.
Of course, some standard “warm up” questions are to be expected, including those that allow you to describe your strengths and limitations. But let’s go beyond that and talk about some other questions you may get in an investment banking job interview.
1. Tell me about your background. How did you get where you are today?
This is your chance to cover the highlights of your resume at a high level. Companies are looking for good communicators, good leaders, and problem solvers. Mention how you work under pressure and highlight your flexibility in the face of challenges. Most important of all, indicate that you’re methodical and systematic in dealing with problems and you can work well in a team setting.
Discuss your main competencies and how you applied them to achieve results in your previous job or during your stay in your university or post-graduate school. Don’t gloss over your failures. Instead, discuss how you handled the difficult situations, and the lessons you learned from them. Mention deals that you helped close, and your role in closing the deal.
2. Describe some situations where you had to take risks.
Risk-taking and tough decision-making can summarize your entire job description as an investment banker. As someone who handles funds and investments, you are expected to make tough decisions, while navigating the delicate environment brought on by political change within the company and the industry. Risk-taking is inevitable as an investment banker, and the bank needs someone who can manage the risks associated with specific deals. Mention your capacity to make logical assumptions and calculated guesses, and how this factors in your decision making.
3. Describe an ethical decision you had to make.
Be ready to discuss difficult decisions you’ve made in your interview. Trust and integrity are very important in an investment banking career and have become more important in recent years. If you’ve studied the subprime crisis, as well as the near collapse of the mortgage giant, Fannie Mae, as well as the recent restatement of financial accounts of several investment banking firms, you’ll understand how crucial it is to make ethical decisions. Unethical practices lead to the downfall of big, previously stable companies. Discuss your thought process. What factors did you consider? These are some of the things that will interest the interviewer because they want to know how you think when you’re in a delicate position in the future.
4. Why hire you over the other qualified candidates?
This is your chance to freely discuss your accomplishments. In a sense, you’re telling the why they’re lucky you chose to apply in their company, but choose your words well. You cannot act too cocky or condescending. After all, they’re the ones that do the hiring. Simply mention why you’re a perfect fit and discuss the parallel between your goals and the company’s growth direction. Mention that you are flexible enough to cope with a changing environment. Often investment banking firms are looking for people who are true professionals with superior energy and intellect, communication skills and problem solving abilities.
5. What do you do with your free time?
An investment banking career involves putting in long hours, which make free time a precious commodity in this industry. What you do with this precious time tells a lot about what kind of person you are. The leaders in these firms want to work with people with diverse interests outside of work. Remember, all work and no play makes for a short career in investment banking.
6. What’s on your bookshelf? What’s on your iPod?
The books and reading materials you collect tell of your passions and interests. Make sure you mention The Wall Street Journal and other business-related periodicals in your answer. Mention prominent authors that have written some of the best self-help books on personal finance and investments. Do you listen to anything besides music during your commute? Here the interviewer wants to know if you take full advantage of personal develop opportunities (like audio books in your down time).
7. Why are you interviewing with our firm?
You’ll be asked to talk about your impression of the company and investment banking in general. Your answer should indicate that you understand how competitive and lucrative the industry is, and how it offers tremendous professional growth opportunities. Discuss your understanding of trends and how they have affected the the industries the bank specializes in. It’s okay to mention some recent mergers and acquisition activity and your impression of these challenges involved. Just don’t go overboard in an effort to impress.
This part of the interview is the best time for you to convince the interviewer that your interest in the investment banking industry is not superficial. Discuss the firm’s strengths and its current position in the industry. It is important that the recruiter understands your level of industry knowledge. By exchanging ideas and discussing the latest industry trends, you’re demonstrating your drive for excellence.
8. Do you have any questions for me?
This is your chance to turn the tables on your interviewer. Prepare a few questions to challenge the interviewer with. Ask about the growth of the firm and new specialties. Discuss reports about deals that been lost. Ask about the interviewers own investment banking career choices. The answers to your questions will give you clues on what the company expects from you.
Of course, receiving an investment banking job interview is the first step. Be prepared for tough questions and keep yourself composed as you deliver your answers. This approach should get you one step closer to the job you want.
About the Author: David Donahue is a writer for JobSearchDigest.com, a site dedicated to career opportunities for investment professionals since 2002. JobSearchDigest.com serves its members by providing a human-edited investment jobs database for Private Equity, Hedge Fund and Investment Banking professionals.