Essay Example on Investment banking is made up of the words investment and Banking

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INVESTMENT BANKING DEFINITION The term investment banking is made up of the words investment and banking The meaning of the term can be understood by seeing that it contains the word investment People invest their money so that they can raise their capital and they can do this by investing their money in a financial institution called an investment bank The main purpose of investment banking is to raise capital and provide advisory services Capital means the financial assets which includes money The operations of investment banking are performed in a financial intuition called an investment bank An investment bank works to provide their clients the maximum financial rewards with the lowest risks involved The people who work at an investment bank are called investment bankers DIFFERENCE BETWEEN AN INVESTMETNT BANK AND A COMMERCIAL BANK SERVICES An investment bank provides financial and advisory services A commercial bank provides traditional banking services like accepting deposits CLIENTS The clients of an investment bank include large corporations and wealthy individuals The clients of a commercial bank include all sorts of people and entities who come from all financial backgrounds like the rich and the poor NUMBER OF BRANCHES An investment bank typically has only one branch in a city A commercial bank has multiple branches in a city IMPORTANCE OF COMMUNICATION IN INVESTMENT BANKING Effective communication plays a very big role in the business role Likewise it also plays an important role in the field of investment banking The investment bankers have to look presentable and must have appropriate communication skills to talk to clients The clients are the source from which the investment bank earns its revenues


When talking to the clients an investment banker must speak clearly and must use appropriate gestures He must also make sure that he doesn't offend the client in any way Client advisory is a major part of investment banking and the investment banker must have appropriate communication skills in order to succeed in this field THE FUNCTIONS OF AN INVESTMENT BANK MERGERS AND ACQUISITIONS The term merger means to merge 2 companies into 1 An investment bank advises the 2 companies about the risks and the benefits that are involved in the merger EXAMPLE When 2 TV manufacturing companies want to merge into 1 company they will hire an investment bank to advise them about the risks and the financial gains involved in the merger Acquisition means to acquire a company Investment bankers are hired by wealthy individuals to help them acquire a company by buying the shares of that same company EXAMPLE Ahmed is a wealthy individual who wants to buy a company called HAROON TRADERS PUBLIC LIMITED He will hire an investment bank to buy the shares of that company The investment bankers will advise him that he doesn t need to buy all the shares of the company he just needs to buy 51 percent of the shares so that he can have the majority of control of that company AID IN THE SALE OF FINANCIAL SECURITIES An investment bank helps companies and individuals to sell their financial securities like stocks shares and bonds EXAMPLE A new company called 



HSO PUBLIC LIMITED has been established It wants to issue and sell its financial security called shares to the general public It will hire an investment bank to make sure that this process moves smoothly and that their shares are easily available in the stock market RISK MANAGEMENT An investment bank helps to manage risk of a corporation or a corporation It advises a corporation or an individual on how they can reduce risk EXAMPLE An individual wants to invest his money in a company He goes to an investment banker and the investment banker decides on certain quantitative and qualitative factors whether the individual should invest or not WEALTH MANAGEMENT Wealth management means to manage the wealth of your client is such a way that you can provide him with certain financial plans which will benefit him in the future INVESTMENT BANKS IN PAKISTAN UBL FUND MANAGERS AMZ Securities BMA Capital Management Limited IGI Investment Bank Limited REASONS WHY PEOPLE CHOOSE THIS FIELD The main reason that people choose this field is because of the monetary compensation Investment bankers are one of the highest paid people in the world Although the work hours are long investment bankers are compensated by overtime pay and bonuses In 2015 the This field involves a lot of analytical thinking and methods A person who has good analytical skills can easily be successful in this field so people who have a strong background in finance choose this field A person can easily leave this field if he wants and still have other opportunities waiting for him In other fields like marketing you have no other career options other than the field of marketing but if you decide to leave investment banking then you can easily get other opportunities The reason is because investment banking involves a diverse set of skills


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