Investment banking

Overview

An investment bank is a financial institution that has three main activities:

  • Assisting its clients (which can be anything from individuals, corporations to governments) to raise capital through the issue of securities
  • Providing a range of advisory services to assist clients in mergers and acquisitions
  • Providing liquidity through its market making activities to facilitate its clients’ trading requirements in financial products such as bonds, equities, foreign exchange, commodities and derivatives.

A full service Investment bank that is active in all three of the above can offer career opportunities in a number of different areas such as: investment banking (including mergers and acquisitions and corporate finance ), debt capital markets (DCM), equity capital markets (ECM), private banking / wealth management.

As well as conducting financial analyses, they regularly communicate their findings and recommendations to CEOs, board members, accountants and corporate lawyers.

Job and recruitment market

The financial crisis has had a profound effect on world markets and the financial institutions such as investment banks that facilitate them. The overleveraging of balance sheets and exposure to mortgage securitisation generated great losses in the sector. As a result investment banks have come under much greater scrutiny from regulatory bodies.  

The recruitment scene has recovered but the sector remains very competitive. Students considering a career in an investment bank must be aware of the changes that have occurred and their knowledge of the sector and their target area / role needs to be strong.

Find out more

  • Get more industry insightsfrom downloadable Vault guides to:
    • Investment Banking (Western or Asia Pacific edition)
    • Middle Market Investment Banking
    • Leveraged Finance
  • Download the Vault: Career insider guide to Investment Banking for a careers overview
  • Go to Prospects for information on different job roles
  • See Inside Careers for an overview of the industry, including job and employer databases
  • See the CFA Society website for qualifications professionals normally have to take while training: the IMC and CFA
  • Keep up-to-date with eFinancialCareers fornews on investment banking
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