A brief, generic guide to the corporate and investment bank for beginners.
Overview:
Corporate and investment banking is a highly coveted, dynamic, and rewarding area of finance. It is a division within the bank that provides a comprehensive suite of financial services to large clients, including corporations, governments, and other institutional clients. These services have one primary purpose: to help clients raise capital while effectively managing risks. This section of the bank is constantly at the forefront of global events and market movements to stay ahead of the competition.
Key business lines:
1) Capital Markets: Namely Debt and Equity Capital Markets (DCM/ECM), which helps clients raise funds via the issuance of bonds and shares respectively.
2) Corporate Banking: Traditional banking services including loans, cash management, and trade finance to corporate clients. As someone in corporate banking, I will elaborate on this in another post.
3) Sales & Trading: This refers to the global markets division, which involves buying and selling financial instruments, including FX and rates, commodities, and fixed income products.
4) Investment Banking: Advisory side, including M&A and other strategic actions.
The Three Offices:
1) Front Office: The client-facing division of the bank that is primarily responsible for generating banking revenue.
2) Middle Office: Bridge between the front and back offices, focusing on essential business operations such as risk, controls, compliance, and legal support.
3) Back Office: Provides general operational and administrative services such as IT, human resources and accounting.
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