Series 79

What Is Series 79?

The term "Series 79" refers to an exam taken by financial professionals who wish to become investment bankers. The test, which is administered by the Financial Industry Regulatory Authority (FINRA), assesses the competency of those who want to work in investment banking. It ensures that these registered representatives have the skills and knowledge needed to act as investment bankers by testing them in several key areas. Individuals who want to take the exam must be sponsored by a FINRA member firm.

Key Takeaways

  • The Series 79 exam is taken by financial professionals who want to become investment bankers.
  • The exam tests knowledge and skills in key areas, including data, underwriting, new financing, restructuring, and M&A, among other topics.
  • The exam consists of 75 scored and 10 unscored questions and lasts two and a half hours.
  • Candidates must receive a score of 73% or higher in order to pass.
  • Passing candidates can participate in debt and equity offerings, M&A activity, asset sales, and other investment banking activities.

Understanding Series 79

The Financial Industry Regulatory Authority is a nongovernmental organization that regulates brokers, broker-dealers, and investment bankers in the United States. In order to become registered with the agency, financial professionals must pass certain exams, which test their knowledge, expertise, and abilities in certain securities-related activities. Once an individual passes, they become licensed in that area of expertise.

One of the exams offered by FINRA is the Series 79 exam or the Investment Banking Representative Exam. It assesses the level of knowledge, skills, and ethical background candidates have for investment banking functions, some of which include mergers & acquisitions (M&A), buyouts, and financial restructuring.

The exam is intended for registered representatives whose financial industry skills are more specific than those of individuals who take the broader Series 7 exam, which is designed specifically for stockbrokers. The Series 79 exam was restructured in October 2018. It is now a co-requisite along with the Securities Industry Essentials (SIE) exam—both of which must be passed in order to receive the Series 79 license.

New rules were enacted in 2009 to better prepare individuals specifically for investment banking activities or supervision of these activities.

Series 79 Focus

The exam is made up of 75 multiple-choice questions. Each question contains four possible choices. There are also 10 unscored questions that appear throughout the exam and are not labeled. The exam is divided and questions are broken up as follows:

Series 79 Exam Breakdown
 Function  Number of Questions Percentage of Exam 
1. Collection, Analysis, Data Evaluation 37 49% 
2. Underwriting/New Financing, Types of Offerings, Securities Registration 20 27% 
3. M&A, Tender Offers, Financial Restructuring 18 24%

Candidates have two and a half hours to complete the exam.

Series 79 Prerequisites

There are no prerequisites to take the Series 79 exam, although candidates must also pass the SIE exam as a corequisite. Candidates, however, must be sponsored by a FINRA or self-regulatory organization member firm before they can take the exam. A $245 fee must be paid in order to sit for the exam.

Series 79 Permitted Activities

As noted above, the Series 79 exam tests individuals on the knowledge and skills they need to work within the investment banking industry. Those who pass the Series 79 and become licensed can engage in the following activities:

Series 79 Question Topics

There are a number of different prep courses and resources available for candidates who need some guidance before taking the Series 79 exam. The following is a list of topics covered by the exam.

Function 1

As noted above, this topic covers the collection, analysis, and evaluation of data. Topics include trend and company analysis, securities offerings, and M&A activity. Individuals are also tested on the analysis of investor and shareholder data, financing opportunities for corporations, and the due diligence process.

Function 2

This function tests a candidate's knowledge on issues relating to underwriting and new financing, along with different types of offerings and securities registration. Test takers may have to answer questions about filing requirements, underwriting agreements, underwriting commitments, and specifics about financing deals (record registration, billing, and finalizing transactions).

Function 3

The last function in the exam tests knowledge in M&A, tender offers, and financial restructuring transactions. Candidates may be asked about their knowledge of sell-side M&A transactions (set up, marketing, and finalization), buy-side transactions, regulations about tender offers, and claims in the bankruptcy process.

Series 79 Exam Details

The exam is closed-book. Candidates are not allowed to bring in any reference materials with them when they take the test. It can be administered at a local test center or proctored online. Exam centers provide four-function calculators, scratch paper, pens, noise-canceling headphones, and tissues (if required). Those who choose the online option must go through an inspection and sign-on requirements. They are given an online calculator and virtual notepad to use during the exam.

FINRA makes accommodations for individuals who may require assistance, aids, or modifications, such as large print exam books and private testing rooms.

Series 79 FAQs

Is the Series 79 Harder Than the SIE Exam?

The Series 79 exam is generally considered more difficult than the Securities Industry Essentials (SIE) exam. The SIE exam is normally taken first and, as such, is considered an introduction to the Series 79 exam, which tests individuals on concepts at a more advanced and higher level.

What Does Having a Series 79 License Allow You to Do?

Individuals who successfully pass the exam and earn a Series 79 license work in investment banking as analysts or bankers. They are licensed to advise clients, help facilitate debt and equity offerings, take part in mergers and acquisitions, make tender offers, conduct financial restructuring and asset sales, as well as corporate reorganizations.

What Is the Series 79 Top-Off Exam?

The Series 79 top-off exam tests individuals who want to become licensed to sell investment banking products. It is part of the process of earning a Series 79 license.

How Long Does It Take to Study for the Series 79 Exam?

The time it takes to study for the Series 79 exam depends on the individual. But it generally takes anywhere between 60 and 100 hours to prepare for the exam. Interested candidates can also purchase a series of prep materials for a cost.

Is the Series 79 Exam Computer-Based?

You must take the Series 79 exam on a computer, the same way you would with any other securities exam.

When Can I Take the Series 79 Exam?

You can take the exam within 120 days of the date on which you enroll. You must schedule an appointment from available dates within that 120-day period after you complete enrollment.

What Is the Passing Score for the Series 79 Exam?

You must get at least 73% if you want to pass the Series 79 exam.

How Long Do I Have to Wait to Retake the Series 79 Exam If I Fail?

You must wait 30 days before you can rewrite the Series 79 exam if you fail. The waiting period is extended to 180 days if you fail three times in a row. Your company must re-sponsor you before you sit down for any retakes. You are also responsible to pay the full fee for any subsequent attempts to write the exam.

The Bottom Line

Financial professionals are regulated and must abide by the rules established by financial authorities. In order to be registered, these individuals must qualify for and pass certain exams in order to work in their fields. The Series 79 exam administered by FINRA allows registered representatives to work in the investment banking industry. These professionals can facilitate a number of areas, including debt offerings, asset sales, M&A, and restructuring activities.

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