Investment banking is one of the vastest, intriguing and rapidly moving fields globally. Thousands and thousands of people fresh out of finance schools aspire to enter and make a niche for themselves in the world of IB. However, it’s only a few geniuses who get the opportunity to do so.
Countless people are curious about knowing what exactly do investment bankers that makes them such important members of the community of bankers in the financial sphere. In the simplest of terms, investment bankers make investments, although, there are a lot more responsibilities in their kitty that not many people are aware of. And, this article shall throw light on all the activities that an investment banker carries out on a day to day basis.
So, if you wish to understand why investment banking professionals are considered to be the superstars of the financial world and get big bucks for their services, the below information will be of great use to you.
What is an Investment Banking Career about?
Investment Bankers are the most respected breed of workers on the wall street. But, it’s definitely not all play and no work. The reason why professionals in the IB sector get coveted and critical positions is that they are immensely well-read and have slogged through years of college to attain relevant knowledge of numbers and how banking works.
Investment bankers work for hours and hours to become worthy of what they receive in terms of remuneration and lifestyle. As they say, there is no such thing as a free lunch. The primary role of IB workers is to raise capital for corporations and governments through activities like the issuance of bonds and stocks along with underwriting.
You surely must have heard about organizations going public and selling stock shares for the very first time through the process of an initial public offering, investors bankers play a gigantic role during the IPOs. For those who do not know, issuing debt is all about selling bonds to different investors. So, in case, an investor takes possession of a corporate bond, they are loaning money, to an organization for a predetermined number of years, typically at a set rate of interest.
Usually, one of the toughest challenges for organizations wishing to raise capital through the issuance of bonds is the search for qualified investors who own great amount of money to invest which is where an investment banker enters the picture. Investment banks possess various aggressive salespeople who own big contact lists comprising of leads that can give them business.
An organization aspiring to issue bonds approach investment banks not just to assist in structuring the bonds but, at the same time, use the broad network of the bank’s potential investors. There is a very similar process that is followed when it comes to raising capital through selling away equity and stocks.
Investment bankers burn the midnight oil to undertake such high-intensity work as it no piece of cake to manage other people’s money.