Investment banks, instead of commercial banks, assist private and public companies in raising funds within the Capital Marketplaces (both equity and debt), plus supplying proper advisory services for mergers, acquisitions and other kinds of financial transactions.
Indeed the initial reason for a good investment bank ended up being to raise investment capital and recommend mergers and acquisitions along with other corporate financial methods. As banking firms happen to be carrying out diversified activities, investment banks have started to fill a number of roles including underwriting and disbursing new security issues, offering brokerage services to public & institutional traders, supplying financial advice to corporate clients, especially on security issues, supplying advices on merger and acquisition deals, supplying financial security research to traders and company clients etc. Investment banks also have moved into forex exchange, private banking, and bridge financing.
A vital role of investment banks would be to advise companies in raising money or funds. There’s two methods for raising funds that investment bankers typically participate in: raising funds with the capital marketplaces and raising funds through private placements. Investment bankers can raise funds in capital marketplaces in 2 ways. They are able to sell the business’s equities within the stock exchange within an dpo (IPO) or secondary offering, or they are able to give advices on debt issues towards the companies. Investment bankers also advise companies on private placements, which mean purchase or purchase of corporate investments by private companies or people. Kinds of private positioning transactions include investment capital investments, proper investments by companies, private equity finance investments, private debt placements, acquisitions, divestitures, and merchant banking.