Investment Banking Representative Exam (Series 79) Flashcards
Browse all 29 cards
What is the exam fee for the Series 79?
$395.
How long do you have to complete the Series 79 exam?
150 minutes (2 hours and 30 minutes).
What score do you need to pass the Series 79?
73%.
What license does the Series 79 qualify a person to hold?
The Investment Banking Representative registration, covering debt and equity offerings and M&A/advisory work.
Define 'due diligence' in an investment banking context.
The investigation of a company's financial, legal, operational, and commercial condition performed before a transaction to verify disclosures and surface material risks.
What is a registration statement (e.g., Form S-1) used for?
It is the SEC filing that registers a securities offering, containing the prospectus and the disclosures investors need before a public sale.
What is a 'firm commitment' underwriting?
The underwriter buys the entire issue from the issuer and resells it to the public, bearing the risk of any unsold shares.
What distinguishes a 'best efforts' from a 'firm commitment' underwriting?
In best efforts the underwriter acts as an agent and only sells what it can, without buying the issue or assuming unsold-inventory risk.
What is the 'quiet period' (waiting period) after filing a registration statement?
The period between filing and effectiveness during which communications are restricted and no sales may be finalized, though a preliminary prospectus may circulate.
In an M&A deal, what is a fairness opinion?
An opinion issued by a financial advisor stating whether the consideration in a transaction is fair, from a financial point of view, to shareholders.
On average, how many seconds do you have per Series 79 question?
About 120 seconds — 150 minutes across 75 questions works out to roughly 2 minutes each.
What is a 'red herring' prospectus?
A preliminary prospectus distributed during the waiting period; it omits final price and is marked with red disclaimer text stating it is not final.
What common valuation methods should a Series 79 candidate know?
Comparable company analysis, precedent transactions, and discounted cash flow (DCF) analysis.
What is a tender offer?
A public offer to buy shareholders' stock, usually at a premium, to acquire control — governed by the Williams Act disclosure and timing rules.
What is a fairness opinion?
An opinion, usually from an independent financial advisor, stating that the consideration in a merger or acquisition is fair to shareholders from a financial point of view.
How many scored questions are on the Series 79 exam?
75 scored questions.
How many scored questions are on the Series 79 exam?
75 scored questions.
How long do you have to complete the Series 79 exam?
150 minutes (2 hours and 30 minutes).
What is the passing score for the Series 79?
73 percent.
What is the fee to sit for the Series 79 exam?
$395 USD.
What job function does the Series 79 license permit?
Acting as an investment banking representative — advising on and facilitating debt/equity offerings and M&A, restructuring, and other corporate financing transactions.
What corequisite exam must be paired with the Series 79?
The SIE (Securities Industry Essentials) exam; together they satisfy the representative-level requirement.
What are the three main function areas the Series 79 tests?
(1) Collection, analysis and evaluation of data; (2) underwriting/new financing transactions, types of offerings and registration of securities; (3) mergers, acquisitions, tender offers and financial restructuring.
Difference between a firm-commitment and a best-efforts underwriting?
In a firm commitment the underwriter buys the entire issue and bears the resale risk; in best efforts it only agrees to sell what it can, with unsold shares returned to the issuer.
What is a tender offer under the Williams Act?
A public offer to buy shares directly from shareholders; it must stay open a minimum period and treat all tendering holders equally (best-price/all-holders rules).
What is a comfort letter in a securities offering?
A letter from the issuer's independent auditors to the underwriters giving assurance on unaudited financial data in the registration statement.
What is due diligence in the context of an underwriting?
The underwriters' investigation of the issuer to verify disclosures and establish a defense against liability for material misstatements or omissions in the registration statement.
Name two common company valuation methods tested on the Series 79.
Comparable companies analysis (trading comps) and discounted cash flow (DCF); precedent transactions is another.
What does EV/EBITDA measure?
Enterprise value relative to earnings before interest, taxes, depreciation and amortization — a capital-structure-neutral valuation multiple used to compare companies.