Investment banking

Investment banking

Introduction

Investment banking is very large and complex and one of the important industries, that drive economic activities on global scale. Investment banking generates revenues around $100 billion US dollar in a year that provides interesting career opportunities for many people around the world. These opportunities include finance, compliance and risk management in specific areas such as mergers, acquisitions, and trading (www.gettinginvestmentbanking.com, 2012).

Discussion

The Affects of Globalization on Investment Banking

Globalization and investment banking go together; they are mixed with each other since globalization presents the options of expanding to new markets and opportunities, where investment banking provides the capital and the opportunities to accept these offers. But the globalization brings with itself certain challenges that are accounting, regulatory and cultural challenges that forces the investment banking to alter the ways they do business. As these financial institutions provides underwrites for the corporations and companies that willing to increases capital by issuing security, which can come in several ways debt securities, equity securities and derived contracts. It also serves as communication between general public and the company issuing the security. Where then comes in globalization which combines the free market communication and capitalism technologies like internet that provides the free flowing of information, products, capital and services around the world immediately. Where public from different cultures, government and nations can interact as one global unit. It brings the developing and developed countries together in order to benefit mutually towards a new cultural and economic relationship (Chestnut, 2012)

One of the examples of the affects of globalization was the credit crunch that took place in the middle 2007, that already too many shapes in the 1st half of 2008.

This study or research is of 2008 which shows the impacts of globalization till 2010, during the worst cases Latin America, the Middle East, Asia and Europe is expected to show during the next three years and absolute growth in the revenue. Keeping all the outcomes in front, the ratio of emerging market's global revenue will increase highly. And mostly the revenues that will be generated from the capital markets and investment banking activities in these countries that are planned to be equivalent to those of North America in 2010

Investment Banking in the Next 5-10 Years

The commercial banking had clear advantages in the debt markets and the securities were similar to that of corporate loans, then they started actively trading within the secondary market. These commercial banks had an important hold in the investment banking industry even before 1999. And in todays financial market there all the possibilities to sell and parcel risks virtually. But in future huge investment banking companies will be subjected to cutting down of fees and the commoditization in a specialized area, within lucrative product lines. And in order to maintain margins firms will have to benefit from their capabilities in maneuvering between the global market and product line and also have knowledge about franchising their markets. Firms can also go through the reality that if the profits are getting ...