9 questions reported in Blackstone Credit interviews, organised by the group that asks them. Every question carries a model answer and graded feedback on your own attempt.
Questions
Easy · Medium
Hard
Model builds
Built in the spreadsheet grid
Leverage capacity, documentation, downside cases and portfolio construction. 5 questions
Tests whether a candidate understands floating-rate loan sensitivity.
A company has $80m of floating-rate debt at SOFR + 550bp and $20m of EBITDA. SOFR rises from 3% to 5%. Calculate cash interest and EBITDA-to-interest coverage before and after the move.
A modelling-style prompt used to test whether EBITDA becomes real deleveraging cash.
A borrower generates $30m of EBITDA. Cash interest is $9m, cash taxes are $3m, maintenance capex is $5m, and working capital consumes $4m. How much cash is available for debt paydown? What could make…
Tests whether you think about the fund, not just the individual credit.
You're building a $2bn direct lending fund. How many positions, how do you diversify, and what returns should LPs expect?
Direct lending interviews start with why private credit won share from banks.
Why would a sponsor choose a unitranche from a private credit fund over a broadly syndicated loan from a bank, when the unitranche is more expensive?
A credit-committee scenario requiring an explicit recommendation, not a list of factors.
Choose one loan. Loan A pays SOFR + 700bp, is second lien at 5.0x total leverage, and has 1.5x EBITDA of equity cushion. Loan B pays SOFR + 525bp, is first lien at 4.0x total leverage, and has 3.0x…
LBO modelling, leverage capacity, value creation plans and exit paths. 2 questions
Leveraged finance and private credit interviews go deep here.
Explain the difference between maintenance and incurrence covenants. What does "covenant-lite" mean, and why should a lender care?
Essential for leveraged finance, private credit and restructuring interviews.
Walk me down the capital structure of a typical LBO from most senior to most junior. For each layer, explain pricing, security, and who buys it.
Spread decomposition, liquidity, index arbitrage and dealer inventory. 1 question
CLOs buy roughly two thirds of the leveraged loan market. Desks need to understand their behaviour.
Explain a CLO. Where does the equity return come from, and what happens when the portfolio deteriorates?
Blended return construction, PIK, warrants and intercreditor terms. 1 question
A junior-capital underwriting question that distinguishes a contractual covenant cure from a durable reduction in default risk.
A sponsor-owned borrower will fail its springing fixed-charge coverage test. The credit agreement allows an equity cure, and the sponsor proposes to inject $12m two days before testing. The agreement…
Write your answer, get it graded on technical accuracy, completeness and communication, and see exactly which mechanic you missed.
Company tags reflect where a question type is commonly reported in interviews. They are not sourced from, endorsed by, or affiliated with Blackstone Credit.