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Happy Thursday, future bankers!

Hope everyone is doing well! Today we’re covering the difference between shareholder’s equity and equity value, what makes you qualified for an internship, and NYCB’s drop in deposits.

🚀 Let’s get into it.

🔢 Technical Question

Is there a difference between Shareholder’s Equity and Equity Value?

Yes, there is a difference between Shareholder’s Equity and Equity Value.

Shareholder’s Equity, also known as book value, is an accounting term that represents the residual claims on the company’s assets belonging to the company’s owners once all liabilities have been paid down. It is calculated as the difference between a company’s total assets and total liabilities. This is the amount that would be returned to shareholders if all the company’s assets were liquidated and all its debts repaid. Shareholder’s Equity also includes retained earnings, which is the amount of profit leftover that is saved or retained and used to pay dividends, reduce debt, or buy back shares of stock.

On the other hand, Equity Value is a market term that refers to the total value of a company’s equity, calculated by multiplying a company’s share price by its number of shares outstanding. This value can be different from the book value (Shareholder’s Equity) because it takes into account the market’s perception of the company’s future earning potential, among other factors.

In summary, while Shareholder’s Equity is derived from the company’s balance sheet (an accounting perspective), Equity Value is derived from the stock market (a market perspective). Both are important measures, but they serve different purposes and can vary significantly based on the company’s performance, market conditions, and investor sentiment.

🗣 Behavioral Question

What makes you qualified for this internship?

This is a common question that interviewers ask to assess your fit, motivation, and skills for the investment banking role. Here are some best practices for responding to this question:

• Start with a brief introduction of yourself, highlighting your academic background, relevant internship experience, and interests. Clearly explain your roles in prior internships, and discuss how they relate to the role you are interviewing for.

• Explain why you are interested in investment banking, and what attracts you to the specific bank and group you are applying to. You can mention some of the deals, clients, or sectors that the bank is known for, and how they align with your goals and passions.

• Demonstrate your qualifications for the internship by providing specific examples of how you have developed and applied the skills and qualities that are essential for investment banking, such as analytical thinking, financial modeling, attention to detail, teamwork, communication, and work ethic. You can use the STAR (Situation, Task, Action, Result) method to structure your examples and show the impact of your actions.

• Conclude by summarizing your main points and expressing your enthusiasm and readiness for the opportunity.

🗞 Industry News

📉 NYCB Loses 7% of Deposits

New York Community Bancorp (NYCB) is in a precarious financial position. The bank experienced a 7% drop in deposits, with many of those being uninsured. This instability prompted a $1 billion capital infusion from a group led by former US Treasury Secretary Steve Mnuchin and a change in leadership. New CEO Joseph Otting plans to reduce the dividend and focus on bolstering the bank's capital and credit practices. While recent news provides some optimism, NYCB's future remains uncertain as executives strategize to prevent further capital raises and regain investor confidence.

Read more about this story below.

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1. Refer Friends: If you manage to get three of your friends to sign up for Finterview, we have a special offer for you. We’ll send you a curated database of links to the career pages of 100+ (and growing) investment banks. This way, you can streamline your search for new internships.

2. How It Works: All you need to do is reply to this email and list the email addresses of the friends you referred. Once we receive your reply and verify the sign-ups, we’ll email you the comprehensive list.

3. Questions or Clarifications: If you have any questions or need further assistance, feel free to reply to this email. We’re here to help! 🌟

Thanks for tuning in today! Best of luck to everyone working through recruiting right now. If you sign an offer, reply to this email and let us know about it! Like seriously, do it—we’d love to hear about it!