Risk Mgmt Analyst Position - Interview

[caratsticks]

Hey all,

This is my first post here but I've been told that you all are helpful when it comes to information or experience. I have an interview coming up for an Analyst in Risk Management at a financial institution and am wondering if anyone can provide some advice in how/what to prep for going into it. I just finished a finance undergrad and this position is pretty much aimed at recent grads. Basically, the posting mainly specifies assisting in:

- Testing of borrower and loss given default risk-rating models in portfolio
- Creation of financial test scenarios for risk-rating models

-- Knowledge of Moody's FA and RA an asset

So if anyone can help, I'd be very grateful! Feedback from past interviews or from experience within the department would be awesome. Also, I've heard that "JoeyDVivre" is the guru around here, so any input from you would be a "blessing" hehe.

Thanks in advance guys!

 

[kkent]

I'm no "guru" but I did UNsuccessfully interview for a risk management position in February (I, too, am a new finance grad). The position was at an energy services firm, so things are probably a little different.

From my experience (now take this for what it's worth--1 experience), I was asked and quizzed about my knowledge of derivatives (which I got probably "B" on), and I had my resume broken down into its parts ("Oh, it says here you know something about valuing IPOs; tell me, how do you value an IPO?). I interviewed with 4 or 5 people and I listened to what they had to say. When they asked me for questions, I was not very well prepared (Note: ask good questions throughout the ENTIRE interview--come prepared!). I was given a math test that I absolutely destroyed ("A" probably); they were questions that a finance major out of a decent program should know (PV, bond valuation, basic derivatives problems, etc.). They liked that I was in the process of learning VBA at the time, but they were definitely interested in somebody who KNEW VBA or SQL.

Ultimately, I lost the job to a Carnegie Mellon engineer with 1 or 2 years experience. Glad I didn't get the job in hindsight because it was WAY over my head quantitatively--in the long run, I wouldn't have been able to hack it.



Edited 1 time(s). Last edit at Thursday, July 12, 2007 at 01:05PM by kkent.

 

[Saks]

Understand the basics, i.e. the mechanics of buying /selling protection, hedging. Understand the intuition of LGD and recoveries (LGD is actually more u shaped due to the intervention of financial stakeholders in the bankruptcy process).

Typical question: Tell me about Brazil's economy now (strong compared to recent times, several multinational companies, diminishing chances of gov't intervention). Ok, tell me what sorts of issues I would think about lending to a multinational Brazilian steel exporter (income in $ and EUR, costs in real, political risk/country risk, currency risk). Cool, tell me what I could do if in fact I did decide to make the loan to protect myself (hedge with CDS, slap into a CDO, ask for add'l collateral). Great, now tell me if the loan went bad and I was unhedged, what I could do, in the specific instance where steel skyrocketed in price globally (concept of LGD, recovery, how do I actually get my $$ back).

That's what I ask fresh MBAs/UG. We can teach a smart person the rest, but enthusiasm and basic intuition (which shows some sort of interest and general intelligence) are key.

 

[caratsticks]

Valuable information kkent and Saks! Thank you very much for directing me in the right direction!

And Saks, this is a great line:

"We can teach a smart person the rest, but enthusiasm and basic intuition (which shows some sort of interest and general intelligence) are key."

Thanks!