CONCEPT OF INVESTMENT BANKING
What is an Investment Bank?
It is neither Investment banking nor I-banking, as it is often called. It is the term used to describe the business of raising capital for companies.
Capital essentially means money. Companies need cash in order to grow and expand their businesses; Investment banks sell securities to public investors in order to raise the cash. These securities can come in the form of stocks or bonds. Thus, Investment banks are essentially financial intermediaries, who assist their clients in raising capital either by underwriting their shares or bonds or by acting as an agent in the issuance of securities.
Please note that Investment banking isn't one specific service or function. It is an umbrella term for a range of activities including underwriting, selling, and trading securities (stocks and bonds); providing financial advisory services, such as mergers and acquisition advice; divestitures, private equity syndication, IPO advisory and managing assets.
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