Help: Summer Interns for Undergraduate Seniors; Extension of Graduation; IBD restrictions for Graduate Degree Students

Hey guys, I discovered my interest in investment banking relatively late. So I need some help with these questions:

1. Do investment banking summer internships recruit undergraduate senior students? I found that some BBs indicate they look for students in their penultimate year. So if that's the case for most investment banks, would it be necessary and plausible to extend my graduation by one more semester?
2. Some people told me that IBD doesn't recruit students with a graduate degree. Is that true?

I'm currently a junior with a moderate GPA and just dicovered my interest in this field. So I'm planning to find an internship first in the summer of my junior year. Can someone please answer my questions above and maybe give me some advice about whether I should in my senior year, find a FT or keep seeking interns in BB cuz I know it will be very difficult to apply for BB w/o a previous internship in those big companies. Thanks a lot:)