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Definitions of investment banking
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INVESTMENT BANKING
?Businesses specializing in the formation of capital. This is done by
outright purchase and sale of securities offered by the issuer,
standby underwriting, or "best efforts selling."
business.gov
http://www.business.gov/phases/launching/are_you_ready/glossary.html
?Investment banking - A form of banking done by investment banking
firms for corporations, often in exchange for fees and commissions.
The bank performs public offerings, acts as a broker, and carries
through mergers and acquisitions.?
http://www.securitiesfraudfyi.com/securities_fraud_glossary.html
?Investment banks assist public and private corporations in raising
funds in the capital markets (both equity and debt), as well as in
providing strategic advisory services for mergers, acquisitions and
other types of financial transactions. They also act as intermediaries
in trading for clients?
Read more here:
http://en.wikipedia.org/wiki/Investment_banking
What is Investment Banking?
Provide strategic, financial and valuation advisory services
- Use industry knowledge, expertise and contacts to advise senior
executives and boards of directors
- Identify and assess strategic opportunities
- Interpret market information and enhance shareholder value
- Provide general valuation services (e.g., segment analysis, break-up
valuations, fairness opinions)
Raise capital through the issuance of securities
- Act as intermediary between issuers and investors
- Provide access to equity and fixed income capital (e.g.,
investment-grade, bank, high-yield, preferred stock)
- Create specialized securities and derivatives (e.g., convertibles,
trust preferred securities, warrants)?
Lehman Brothers
http://pages.stern.nyu.edu/~gfa/resources/Intro_to_Investment_Banking.ppt
Investment Banker
Source: Encyclopedia of Banking & Finance (9h Edition) by Charles J Woelfel
?A firm engaged in investment banking, i.e., financing the capital
requirements of business through the investment markets as
distinguished from seasonal or current requirements normally financed
by means of bank or finance company credit.
The investment banker is the middleman between issuers of securities
requiring capital (public bodies as well as private business firms)
and the ultimate investors, institutional and individual, who have
money to invest. They facilitate the conversion of available savings
into investment and thus perform the important economic function of
improving the flow of needed capital.?
Read the rest of the article here:
http://www.eagletraders.com/advice/securities/investment_banker.htm
INVESTMENT BANKER
?Investment banks do not accept deposits and make loans; they are
specialized divisions of securities firms. Investment Bankers advise
businesses or government agencies planning to raise large amounts of
money, and then help in selling the new stocks or bonds that are
issued to raise the funds .?
College of Business at Illinois State University
http://www.cob.ilstu.edu/finance_ins_law/mapping/fi/career_paths.shtml
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What do investment bankers do?
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A Day in the Life
?Investment bankers advise their clients on high level issues of
financial organization. They manage the issuance of bonds, recommend
and execute strategies for taking over and merging with other
companies, and handle selling a company?s stock to the public. The
work thus involves lots of financial analysis, and a strong background
in finance and economics is a necessity. Personal and strategic skills
are vital to investment bankers as well, for they serve as strategists
for their clients, helping them develop their financial plans as well
as implement them. At the profession?s highest level, investment
bankers serve as crucial figures in the shaping of the American and
world economies, managing mergers of multibillion-dollar corporations
and handling the privatization of government assets around the world.
All this is time consuming, and investment bankers work long hours.
Work weeks of 70 hours or more are common, and all night sessions
before deals close are the rule rather than the exception. Still, the
work is extremely interesting, and those who stay in the profession
report high levels of job satisfaction. Investment bankers spend large
amounts of time traveling, to pitch ideas to prospective and current
clients or to examine the facilities of companies being purchased by
their clients. In the office, they spend their time developing
strategies to pitch to clients, preparing financial analyses and
documents, or working with the sales forces of their banks in selling
the bonds and stocks which are created by the investment-banking
department?s activities.?
Princeton Review
http://www.princetonreview.com/cte/profiles/dayInLife.asp?careerID=84
Read more at the links below:
Investment Banker: Quality of Life
http://www.princetonreview.com/cte/profiles/qualityOfLife.asp?careerID=84
Past and Future
http://www.princetonreview.com/cte/profiles/pastFuture.asp?careerID=84
Facts and Figures
http://www.princetonreview.com/cte/profiles/facts.asp?careerID=84
Examples:
"When firms go public, they hire an investment banker who markets the
company and facilitates the distribution of shares," says Loughran.
"Investment bankers advise the company on a fair stock price. This
price is usually undervalued in order to help the company get its foot
in the door on opening day."
Notre Dame Business Online
http://www.nd.edu/~ndbizmag/issue7/feature.shtml
?Investment Bankers advise and inform managers of new stocks or bonds
being issued along with the research behind the companies or
institutions offering the stocks. The manager then decides whether to
buy or not from the investment banker. The investment banker gets a
commission for carrying out the trade of stock or bond. The investment
manager gets paid based on the amount of money he is managing for a
client but gets paid whether or not he gains or loses money.?
http://www.associatedcontent.com/article/6347/working_in_financewhy_i_want_to_work.html
?Investment bankers advise companies on mergers and acquisitions,
raise money for expansion, and sometimes help arrange stock
offerings.?
http://www2.umt.edu/comm/s06/alumnus.shtml
Investment Banking vs. Consulting
?Like consultants, investment bankers provide strategic advice to their clients.?
?For example, investment bankers advise clients on how to survive in a
changing industry
Optimize operating and stock price performance by divesting non-core
business units
Capitalize on synergies or unrecognized value by acquiring other
companies or assets.?
However, unlike consultants, investment bankers also provide financial advice to
their clients
Investment bankers present their clients with alternatives to reduce
the client's cost of capital or to help the client obtain a stronger
balance sheet
In simple terms, investment bankers efficiently match capital
providers with capital users
While transactions are conceived at a "strategic" level, execution
requires detailed analysis and a thorough understanding of the
financial, accounting and tax profile of the client
More immediate, visible results to your advice ? transactions executed
in shorter time period and the "market" provides an immediate opinion
on your advine.?
Lehman Brothers: Introduction to Investment Banking
http://pages.stern.nyu.edu/~gfa/resources/Intro_to_Investment_Banking.ppt
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Investment banking + definitions
I hope the information provided is helpful!
Best regards,
Bobbie7 |
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